“Credit unions don't think creating jobs for the American economy is a game and we don't need taxpayer funds to do it,'' Grinnell added.

Grinnell, whose $887 million credit union is headquartered in Corning, N.Y., is representing NAFCU.

Addressing the same practices, Coasthills FCU President/CEO Jeff York called it “an outrageous abuse and a “wholesale disregard by these banks for taxpayers and small businesses.'' His $618 million CU is headquartered in Lompoc, Calif., and York is representing CUNA.

ABA Chairman-Elect Albert C. Kelley doesn't address those issues in his prepared testimony but says that raising the cap isn't needed because “credit unions have ample authority under current law to make all the small business loans they want.''

And it would cause credit unions to “stray even further from their mission to sere consumers, especially those of modest means,'' added Kelley, the president/CEO of SpiritBank of Tulsa, Okla.

In their testimony, Grinnell and York both say that the current 12.25% cap on MBLs discourages many credit unions from getting into commercial lending, not just that are running up against the cap.

The hearing is being held by the House Financial Services Committee's Subcommittee on Financial Institutions and Consumer Credit. NCUA Chairman Debbie Matz is also scheduled to appear at the hearing but the panel hasn't released her testimony.

Reps. Ed Royce (R-Calif.) and Carolyn McCarthy have sponsored the legislation and so far it has 86 cosponsors. Sen. Mark Udall (D-Colo.) has sponsored companion legislation in the Senate and it has 21 cosponsors.

Both bills require that credit unions must be well-capitalized, be at or above 80% of the current cap, have five or more years of member business lending experience and be able to demonstrate sound underwriting and servicing.

If a credit union's net worth ratio falls below the well-capitalized requirement (currently 7%), it would have to stop making new business loans.