CLEARWATER, Fla.—NCUA Board Chairman Mark McWatters today re-emphasized that the agency is revising its regulations to reduce the regulatory burden on credit unions.
Speaking to attendees of the National Federation of Community Development Credit Unions’ Annual Conference here, McWatters said that his collaborative partnership with Board Member Rick Metsger has resulted in more than two dozen “substantive changes” to NCUA’s regulatory structure, resulting in less burdens on credit unions while enhancing access to affordable financial services, including for consumers in unbanked and underserved communities.
McWatters also announced to the meeting the awarding of $2 million in Community Development Revolving Loan Fund grants to 203 low-income credit unions. These funds will be used for digital services and security programs, outreach to underserved areas, and leadership development and training for credit union staff, he said.
Congress created the Community Development Revolving Loan Fund, which the NCUA administers, to provide grants and loans to credit unions serving low-income communities. The agency received applications from 243 credit unions for more than $2.5 million in funding requests during its 2018 grant round, McWatters explained.
McWatters also told the meeting that there continues to be “strong and consistent demand” for short-term, small dollar loans. A viable short-term loan program provided by credit unions could be an alternative to high-priced payday loans and a way to break the cycle of debt that traps millions of consumers, he argued. Additionally, such a loan program could be a first step in bringing the millions of unbanked and underserved populations into the credit union system, he said.
In June, the NCUA board proposed amendments to the NCUA’s payday alternative loan regulations to provide federal credit unions with additional market-based, payday alternative loan options. Adjustments to the proposal are being considered to better meet the needs of consumers, McWatters noted.