NCUA Board Member Tanya Otsuka Remarks at Treasury’s Roundtable for Providing Financial Access to Justice-Impacted Individuals

As Prepared for Delivery on April 24, 2024

Good afternoon and thank you to Deputy Secretary Adeyemo and everyone at Treasury for convening this critical and timely discussion.

The credit union system is an important and unique part of our financial system because it is centered around a cooperative business model that is driven not by a profit motive or shareholder interests, but by the needs of credit union members. Many credit unions were created to serve communities that the traditional financial system has long forgotten. So, it is fitting that the NCUA and credit unions are at the table when it comes to providing financial access to justice-impacted individuals and marginalized communities.

One of the challenges justice-impacted individuals face when looking to open a bank account is the lack of a driver’s license or other IDs typically preferred or required by banks. The NCUA previously issued an opinion indicating that it is acceptable to use an individual taxpayer identification number (ITIN) to open an account, and credit unions have led in this space.

For example, Stepping Stones Community Federal Credit Union, which is here today, serves justice-impacted individuals at three local prisons in Delaware by partnering with the Delaware Department of Corrections. They use ITINs to open accounts for members and work with the business office at the prison to gain identification information to establish the account. The prison provides documents certifying the authenticity of the members and names. As of November 2023, the program had 482 active accounts totaling more than $300,000.

Several credit unions in New York City, including the Lower East Side People’s Federal Credit Union, Neighborhood Trust Federal Credit Union, Urban Upbound, and USAlliance currently accept IDNYC, a municipal ID card that New York City started issuing in 2014. It is available to all residents of New York City, including people from some of the most vulnerable communities, such as those who are unhoused, justice-impacted individuals, immigrants, and others who may have difficulty obtaining a government-issued photo ID.

Lastly, the NCUA recently updated its policy on preserving minority depository institutions (MDIs) -- a main priority for me. As a regulator whose focus is to ensure fair, safe, and accessible banking services to credit union members, the NCUA is committed to preserving minority depository institutions, providing technical assistance and support, and encouraging new ones to form.

MDIs have a long history of bridging the gap to underserved communities. Many of the credit unions doing the work of helping justice-impacted individuals are MDIs. Indeed, four out of the five credit unions I mentioned today are designated MDIs.

I am encouraged by the steps the NCUA and credit unions have taken to address the financial gap justice-impacted individuals face. However, we know that more needs to be done, and I look forward to hearing from you all on how we can continue to expand access and economic empowerment to more people and communities. Thank you.