Nussle: Lift member business loan cap in underserved areas

by David Baumann, Washington CU Daily

The Credit Union National Association on Wednesday renewed its call to allow credit unions to make business loans in underserved areas even if the lending exceeds their member business loan cap.

“Credit unions recognize that access to capital is critical to ensuring the survival of many of our nation’s most vulnerable small businesses, including minority and women-owned businesses, which together represent approximately 66% of U.S. small businesses,” CUNA President/CEO Jim Nussle wrote in a letter to leaders of the House Financial Services Committee’s Diversity and Inclusion Subcommittee.

The subcommittee on Wednesday held a hearing on the financial problems  minority-owned and women-owned businesses have in obtaining contracts for infrastructure projects.

“According to the Board of Governors of the Federal Reserve System (Federal Reserve), business owners of color report having reduced access to traditional capital from banks and credit unions,” the subcommittee’s Democratic staff wrote in a memo prepared for the hearing. The document goes on to state that in order to bid on projects, businesses must secure performance bonds, adding that minority businesses in particular have suffered discrimination in obtaining such bonds.

 

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