ALEXANDRIA, Va. – The National Credit Union Administration and the U.S. Treasury Department’s Community Development Financial Institutions Fund signed an agreement Thursday intended to “streamline” the application process for low-income credit unions to become certified as Community Development Financial Institutions.
Credit unions that obtain CDFI certification can access training and competitive award programs provided by the CDFI fund, and those resources can assist these institutions’ “capacity to provide under-served communities with access to safe and affordable financial services,” according to NCUA.
NCUA and Treasury said they want to double the number of certified CDFI credit unions by the end of 2016 – an initiative that could “significantly expand funding” that can be used to offer financial services to under-banked low-income individuals.
There are currently 295 credit unions certified as CDFIs -- with the majority of them holding the NCUA’s low-income credit union designation.
“This [agreement] opens up enormous possibilities for credit unions,” said NCUA board chairman Debbie Matz in a statement. “By facilitating the CDFI application process and, ultimately, increasing the number of certified CDFI credit unions, we’re laying the foundation for greater access to affordable financial services and more investment in local communities. This will help credit unions better serve members and communities that have been difficult to reach, and that will help more people build wealth and more secure financial futures for themselves and their families.”
William Myers, director of the NCUA’s Office of Small Credit Union Initiatives, said that his group is looking forward to helping more credit unions become certified as CDFIs.
“We’re going to be able to help credit unions save time and money in the certification process and bring more recognition to what credit unions do so well,” he stated.
Annie Donovan, CDFI fund director, commented that CDFIs nationwide are “making a real difference” in low-income communities by providing consumers with “safe and affordable” financial services and by providing neighborhood businesses with access to capital.
“Many low-income credit unions are already performing this important work, but need more support,” Donovan added. “By partnering with NCUA to increase the number of credit unions certified as CDFIs, we will not only expand access to the CDFI Fund’s programs but also reach more unbanked and under-banked individuals.”
