Furthering DEI & Financial Inclusion Through Advocacy

America’s economic recovery from the pandemic has sparked a renewed focus on the financial burdens placed on historically marginalized and underserved communities. Policymakers have a strong imperative to end systemic practices that limit access to financial services and increase financial deserts across our nation.

We’ve seen this commitment materialize into legislative action thanks to the newly-created House Financial Services Subcommittee on Diversity and Inclusion, led by Chairwoman Joyce Beatty (D-Ohio) and Ranking Member Ann Wagner (R-Mo.).

They want to hold big banks accountable for discriminatory lending practices, reign in payday lenders, expand homeownership and help families of all backgrounds achieve financial well-being. Confronting the inequities of our society through financial inclusion is the heart of the credit union mission and core to CUNA’s advocacy agenda.

CUNA works tirelessly to ensure policymakers know that as not-for-profit, member-owned financial cooperatives, credit unions are laser-focused on advancing financial inclusion and equity in the communities we serve. CUNA has proudly supported efforts to increase funding for Community Development Financial Institutions (CDFIs) and Minority Depository Institutions (MDIs), eliminate barriers for the LGBTQ+ community, and ensure women and minority-owned businesses have access to capital without being squeezed by regulatory red tape.

In addition, CUNA has called on Congress to modernize the Federal Credit Union Act so that credit unions can remain the best financial option for consumers. One of the most important things Congress could do to promote financial inclusion is to permit all federal credit unions to serve underserved areas. CUNA is working closely with House Financial Services Committee Chairwoman Maxine Waters (D-Calif.) to introduce the Expanding Financial Access for Underserved Communities Act. The bill would allow federal credit unions to add underserved areas to their field of membership and exempt business loans in low-income areas from the arbitrary member business lending cap.

Furthermore, the legislation expands the definition of a low-income credit union to include any area that is more than 10 miles from the nearest branch of a financial institution. Credit unions’ outdated field of membership restrictions and the member business lending cap shut out those who most need access to mainstream financial services.

At this pivotal time, when our nation must face the reality that the pandemic has disproportionally affected underserved and communities of color, CUNA strongly believes this legislation takes significant steps forward in addressing financial inclusion for all Americans.

As we look beyond the pandemic, we know that access to capital will be critical to ensuring the survival of many of our nation’s most vulnerable small businesses, particularly women and minority-owned businesses. We also know that credit union lending is more inclusive; research from the Small Business Administration (SBA) showed that roughly 80% of credit union business loans are loans that banks would not make.

Credit unions are stepping up to meet Americans’ financial needs. Because we are owned by the members we serve every day, credit unions have vested interest in advancing our communities. That’s why credit unions work so hard to improve members’ savings, help them invest in their homes or businesses, and be there in times of need. To that end, it’s important for the credit union movement to continue to advocate for our members and our not-for-profit mission and structure that enables us to provide affordable financial services to all.

It’s at the heart of what credit unions do – people helping people – regardless of background.

Abigail Truhart is the Director of Advocacy at CUNA in Washington, D.C.