ALEXANDRIA, Va.–Members of the NCUA board were given an update on the Consolidated Emergency Capital Investment Program (ECIP) created by the Consolidated Appropriations Act, with all three urging certain credit unions to take advantage while they still can.
The program is designed to help community-based financial institutions support consumers and local small businesses in low-income and underserved communities that have been disproportionately affected by the economic effects of the COVID-19 pandemic. A federally insured credit union must be certified as a Community Development Financial Institution or as a minority depository institution to participate in the program, NCUA reminded.
According to NCUA staff, 747 credit unions are eligible to participate, more than 600 of those as the result of being CDFIs.
Both Chairman Todd Harper and Board Member Rodney Hood spoke highly of the program and urged CUs to move quickly if interested. Harper noted $9 billion has been allocated for the program and when the funds are gone no more money will be available.
Harper further reminded that $4 billion of this funding is set aside for institutions with less than $2 billion in assets, and $2 billion of that amount is set aside for institutions with less than $500 million in assets.
Hood said ECIP dovetails with NCUA’s Access Initiative and will help bring greater financial resources to underserved and primarily minority communities.
‘Deeply Committed’
“I am deeply committed to advancing economic equity and justice, and today’s briefing raises awareness about this important, albeit short-term, tool that has the potential to make a real difference in the lives of many Americans,” said Harper. “And, the ECIP aligns with the mission of the credit union movement to expand access to affordable financial services to those of modest means.
“Therefore, I strongly encourage eligible credit unions to tap into the ECIP to support the communities they serve. Eligible credit unions are uniquely positioned to step in and step up, because of their size and their business plans focused on fostering economic development in economically challenged communities.”
‘Shining During Times of Crisis’
For his part, NCUA Vice Chairman Kyle Hauptman said, “It is no secret that credit unions shine during times of crisis, and the pandemic has been no exception. For CDFI credit unions and Minority Deposit Institutions (MDI) credit unions, it goes beyond providing financial services. It includes engaging with community leaders; coordinating with businesses and creating coalitions to support those in need. I encourage CDFI and MDI credit unions to take advantage of this funding.”
Hauptman noted that during one recent webinar a CU had complained that too often CDFI and MDI credit unions are invisible to state and local leaders as sources of support for distressed communities.
“But the pandemic has provided an opportunity to change that, especially when credit unions work together,” he said, citing efforts by CDFIs in New York and Oregon to make millions of dollars in loans to small businesses.