Hawaii Gains a Community Development Financial Institution
Kaua‘i Government Employees Federal Credit Union becomes a CDFI on the island.
The U.S. Treasury Department has certified Kaua’i Government Employees Federal Credit Union as Hawaii’s 12th Community Development Financial Institution (CDFI).
KGEFCU of Lihu’e ($125.9 million in assets, 7,226 members) is the first CDFI on the island of Kauaʻi, which is the fourth-largest island of Hawaii, covering 562 square miles. Its 2010 population was 66,921, and its largest city, Kapaʻa, is about 120 miles northwest of Honolulu.
President/CEO Monica Belz said the CDFI certification, offered to underserved communities across America, significantly opens up access to new capital to support recovery and innovation on Kauaʻi.
“We are developing a formidable set of tools to grow new businesses, re-circulating money locally to create a more diverse economy,” Belz said. “By growing a more equitable system of capital access, we ensure local talent can flourish and Kauai’s children can remain at home or return home to meaningful jobs.”
“We are experiencing a true coming of age moment for the credit union movement,” she said. “I truly believe in the power of our DNA to disrupt the financial industry across the globe, as we rebuild the economy together.”
In 2021, KFGECU will release a series of short videos showcasing stories of resilience and recovery on Kauai. Belz said the stories show “the fearless spirit of local entrepreneurs who are working tirelessly in the wake of the pandemic to uphold tradition, support the community and forge a new future for the island.”
The Trump administration called for elimination of the CDFI program in each of its budgets.
However, President-elect Joe Biden made a firm commitment to support CDFIs in December when Treasury Secretary-designate Janet Yellen met with representatives of CDFIs and Minority Depository Institutions, including two credit union CEOs.
During the conference call, Yellen acknowledged the role CDFIs and MDIs in delivering banking services to unbanked and underbanked communities. She said she would ensure efficient distribution of $9 billion in stimulus funds for a new Emergency Capital Investment Program and $3 billion for the CDFI fund.
Since its creation in 1994, the CDFI Fund has awarded over $3.9 billion to community development organizations and financial institutions, and has guaranteed more than $1.7 billion in bonds through the CDFI Bond Guarantee Program. It has also awarded allocations of New Markets Tax Credits designed to attract private-sector investments.
As of Dec. 16, 2020, there were 11 CDFIs in Hawaii, including four credit unions. With the addition of the Kaua’i Government Employees Federal Credit Union, the five credit union CDFIs have $610.3 million in assets and 50,753 members. The other four are:
- Hawaii Federal Credit Union, Honolulu ($99.1 million in assets, 13,225 members)
- Molokai Community Federal Credit Union, Kaunakakai ($30.8 million in assets, 4,090 members)
- Hawaii First Federal Credit Union, Kamuela ($42.3 million in assets, 8,388 members)
- Hawaii Central Federal Credit Union, Honolulu ($312.2 million in assets, 17,824 members)