Fringe Is the New Mainstream: Community Development Credit Unions
Every service and program a credit union offers is built with the needs of the community in mind, and this particularly critical for members of community development credit unions. Jamie Strayer, co-owner and founder of Credit Union Strategic Planning, shared that most credit unions could qualify as Community Development Financial Institutions and receive grant funds from the Treasury Department they can leverage to spread even more credit union goodness!
Credit unions don’t realize the work they do every day is special, Jamie observed; they are just doing the work they set out to do, which is character- and risk-based lending for average, hardworking people.
Pelican State Credit Union in Louisiana ensures all its employees are certified financial counselors to ensure the best service to its members.
Commodore Perry Federal Credit Union in Ohio has implemented technical skills and wage replacement loans to assist workers seeking training at technical schools to improve their financial futures.
Credit unions to get their CDFI certification is key. The biggest misconception regarding certification is that a credit union somehow has to small or “fringe” to participate in CDFI, and Jamie said that is just not the case! Most credit unions already have products, services, programs they need to get certified and obtain access to Treasury’s CDFI grant money and other benefits.
Every credit union should attempt to become CDFI certified, Jamie said, and there’s no better time than now to do it with special COVID-19 relief programs! The Treasury’s Emergency Capital Investment Program, enacted into law earlier this year, includes $12 billion – with a capital B – in additional funding for CDFIs and Minority Depository Institutions! Credit unions can leverage these funds to develop new services and products, as well as enhancing older ones. Other benefits include the ability to accept Bank Enterprise Award deposits and elimination of the statutory member business lending cap.
One more important thing to remember, Jamie emphasized, is that change comes from within the community, and credit unions must embrace their entire communities. Ensure Diversity, Equity and Inclusion in your credit union’s hiring processes and programs and build the best team to create and offer helpful, quality services to the diverse communities you serve.
“When credit unions see themselves as the change-makers, which they are,” Jamie exclaimed, “they begin to experience a reality where they are relevant. And that reality means high loan demand, because you’re relevant, because you’re needed. Look at the way your products meet needs.”
