NCUA’s Harper Urges Congress to Increase CDRLF Amount
The agency files a new report highlighting the effectiveness of the CDRLF, especially during COVID-19.
The NCUA released a new report on Tuesday to show the positive impact the Community Development Revolving Loan Fund (CDRLF) has had on low-income credit unions, its members and communities across the U.S. in 2020.
The report was an attempt by NCUA Chairman Todd Harper to convince members of Congress to have an open dialogue with him about increasing the amount of the CDRLF appropriations in 2022.
The report stated that grants and loans supported by the NCUA’s CDRLF appropriation have a significant, positive impact on credit unions, their members and their communities. Credit unions use these funds to improve and expand services and member outreach, which promotes greater financial inclusion. They also employ funds in other areas like staff training and cybersecurity, which improves overall safety and soundness.
“Since its creation, the Community Development Revolving Loan Fund has been an efficient and effective program for targeting public resources to do public good,” Harper said.
He continued, “Because demand regularly exceeds the amount of available funds for these grants, and because low-income credit unions are more likely to serve communities disproportionately impacted by COVID-19, I urge Congress to increase appropriations for CDRLF grants in 2022. With more funding, the agency could increase the number of credit unions receiving grants and increase the size of the grants it makes, deepening the program’s impact in underserved communities.”
According to a news release from the NCUA, in 2020, the NCUA devoted nearly all its CDRLF efforts to help credit unions and their members meet the significant challenges posed by the COVID-19 pandemic. “Overall, the NCUA received 432 technical assistance grant and loan requests for a total of $7.6 million. The agency’s funding capacity allowed it to only award $3.7 million in technical assistance grants and loans to 165 credit unions. Additionally, the NCUA awarded 149 credit unions in 42 states and the District of Columbia more than $968,000 in urgent need grants,” the statement read.
Congress created the CDRLF to stimulate economic development in low-income communities served by credit unions. Low-income-designated credit unions looking for CDRLF grants in 2021 can apply to the NCUA by June 26.
The NCUA provides grants and loans to low-income-designated credit unions that use this funding to improve and expand services to members, build capacity and stimulate local economic activity. Although relatively small in size, these grants make a big difference to low-income and minority credit unions working to provide more and better services to their members and communities.