FOM modernization markup continues into Wednesday

The House Financial Services Committee will continue its markup of several credit union-supported bills, including the Expanding Financial Access for Underserved Communities, Wednesday. The markup went into Tuesday evening before breaking for a series of votes on the House floor.

The National Cooperative Business Association—of which CUNA is a member—sent a letter of support of H.R. 7003 Tuesday.

“The Expanding Financial Access for Underserved Communities Act would address the epidemic of the unbanked and underbanked in the United States by making it easier for consumers in areas without sufficient financial services providers to access credit unions,” the letter reads. “As representatives of the cooperative movement, we strongly support this legislation, which would make three changes to the Federal Credit Union Act to enable and encourage credit unions to serve underserved and abandoned communities and promote financial inclusion to all at no cost to the taxpayer.”

The changes to the Federal Credit Union Act are:

• Allowing all federal credit unions to add underserved areas to their field of membership.
• Exempting business loans made by credit unions in underserved areas from the credit union member business lending cap.
• Expanding the definition of an underserved area to include New Markets Tax Credit areas and any area that is more than ten miles from the nearest financial institution branch.

Several other credit union system partners wrote to the committee in support of H.R. 7003 as well.

The African American Credit Union Coalition said the bill would be “critical in addressing the epidemic of unbanked and underbanked Americans by leveraging the success of the credit union model to foster financial wellbeing and provide access to capital to communities most in need.”

Inclusiv wrote that the bill “break down the barriers” that keep credit unions from being a part of the solution to serve marginalized communities, and the bill is a “significant step forward toward building a more inclusive economy.”

The National Association of Latino Credit Unions and Professionals wrote “it is vital that underserved and traditionally marginalized communities have access to a trusted, local financial partner that protects them from payday lenders, responds to unexpected financial needs, and provides asset building opportunities to buy a home, secure reliable transportation, afford higher education and start or grow a business.”