Financial access to America’s economically underserved communities may have just received a big legislative boost.
The Credit Union National Association (CUNA) wrote a letter to the House Financial Services Committee leadership on June 8, 2021, fully backing the proposed Expanding Financial Access for Underserved Communities Act, an amendment to the Federal Credit Union Act. During the May hearing, the committee discussed draft legislation while CUNA supplied the letter of support.
“The Expanding Financial Access for Underserved Communities Act is a market-based solution that would make…changes to the Federal Credit Union Act to enable and encourage credit unions to serve underserved and abandoned communities to promote financial inclusion to all at no cost to the taxpayer,” said the letter.
If enacted into law, the bill would help progress financial inclusion for consumers in the following ways:
- Allow all federal credit unions to add underserved areas, or “banking deserts,” to their field of membership
- Expand the definition of an underserved area to include any area that includes that is more than 10 miles from the nearest branch of a financial institution
“Credit unions’ field of membership restrictions…shut out those that need access to financial services,” CUNA continues. “This legislation is not a panacea to these exclusionary policies, but it does represent a solid step forward toward financial inclusion.”
Such a bill couldn’t be more important for consumers endeavoring to overcome the effects of the COVID-19 pandemic. Whether furloughed or laid off from their jobs, America’s workers need access to credit unions whose founding mission it is to provide the financial education, access, and stability required to help individuals and families get back on the path to financial well-being.
Even prior to the pandemic, when 55 percent of Americans claim they’re merely “financially coping,” it’s obvious underserved communities need the mentorship and financial tools to recover and build their financial future in a smart and steady manner.
A core advantage for credit unions who take advantage of the financial services bill above would be to partner with fintech companies like QCash in making white-label, mobile small dollar loans that serve those rural communities. This move would ensure that members located in such banking deserts receive the financial services tools they need to improve their finanical lives under the nurturing tutelage of their local credit union.
Rather than evaluating a member’s a one-dimensional credit score, QCash’s proprietary relational underwriting platform is designed to take a more detailed, 360-degree evaluation of a member’s relationship, bypassing the limited scope of credit. From six clicks to apply to deposit in 60 seconds, QCash is ready to help your members discover affordable access regardless of where they live.
For more info on how QCash can help your credit union, visit our website and check out our product demo.