ALEXANDRIA, Va. (Dec. 19, 2013) – More than 2,000 credit unions across the country now carry the low-income designation, National Credit Union Administration Board Chairman Debbie Matz announced today.
These 2,002 low-income credit unions have a combined total of nearly 20 million members and $176 billion in assets. Credit unions with the low-income designation range from very small institutions to ones with more than $1 billion in assets.
“Low-income credit unions play an important role in their communities,” Matz said, “and the growth in the number of credit unions with the low-income designation could provide additional opportunities for investment in local economies. These credit unions can promote greater financial security for their members by providing loans to support a small business, purchase a house or send family members to college.”
Low-income credit unions are often the only insured depository institutions serving low-income and underserved areas, Matz said. A list of federally insured credit unions with the low-income designation is available online here.
To qualify as a low-income credit union, a majority of a federal credit union’s membership must meet low-income thresholds based on 2010 Census data. The designation offers several benefits to credit unions, including:
- An exemption from the statutory 12.25 percent cap on member business lending, which expands access to capital for small businesses and helps credit unions diversify portfolios;
- Eligibility for Community Development Revolving Loan Fund grants and low-interest loans;
- Ability to accept deposits from non-members; and
- Authorization to obtain supplemental capital.
NCUA will host the third in its series of webinars on low-income credit unions on Jan. 15, 2014. The first two webinars are available online here. More information about the benefits of the low-income credit union designation is available here.
In August 2012, NCUA announced an initiative that streamlined the application process for federal credit unions to secure a low-income designation. More than 900 credit unions have received the low-income designation since NCUA launched the initiative. More recently, NCUA has successfully implemented an agreement with the National Association of State Credit Union Supervisors and state regulators to streamline the approval process for federally insured, state-chartered credit unions.
NCUA is the independent federal agency created by
the U.S. Congress to regulate, charter and supervise
federal credit unions. With the backing of the full
faith and credit of the United States, NCUA operates
and manages the National Credit Union Share
Insurance Fund, insuring the deposits of more than
99 million account holders in all federal credit
unions and the overwhelming majority of
state-chartered credit unions. At
Pocket Cents, NCUA also educates the public on consumer protection and financial literacy issues.