CU expansion to underserved areas recommended by CFPB taskforce

January 5, 2021

The Consumer Financial Protection Bureau’s (CFPB) Taskforce on Federal Consumer Financial Law recommends expanding credit unions’ ability to serve underserved areas in its report with more than 100 recommendations. CFPB Deputy Director Tom Pahl discussed the report and the taskforce’s recommendations during a call Tuesday morning with CUNA President/CEO Jim Nussle.

CUNA submitted comments on the taskforce in June 2020, urging it to, “look closely at the outsized impact that the Bureau’s rules have had on credit unions as community-based financial institutions and to recommend the Bureau streamline regulations with an eye toward improving the financial health and well-being of consumers.”

The report is split into two parts, the first with discussion and analysis and the second with more than 100 recommendations in 19 different areas of consumer financial protection law.

It includes recommendations on the CFPB, as well as NCUA, Congress and state policymakers.

The taskforce recommends expanding credit unions’ ability to serve under-served areas, currently only the multiple common bond charter can serve underserved communities outside their common-bond membership.

“The Taskforce is unable to discern a logical reason for excluding certain credit unions from serving underserved areas simply because of the terms of their common bonds,” it reads.

It also recommends NCUA recommend to Congress that all credit union charter types can serve underserved areas, “given the potential to increase inclusion.”

Since the recommendations are those of the taskforce itself the CFPB has not directly endorsed them.