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Member Business Lending

Credit unions have been making member-business loans (MBLs) since their inception in the early 1900s. In the first 90 years of their existence, there was no cap on business lending. The current cap was imposed by Congress in the Credit Union Membership Access Act of 1998 (CUMAA) and limits most credit unions to lending no more than 12.25% of their assets to small businesses without any economic, safety and soundness or historical rationale. Credit unions could lend an additional $13 billion to small businesses, helping them create over 146,000 new jobs in the first year after enactment if Congress increases the statutory cap on credit union business lending. This can be done without costing the taxpayers a dime and without increasing the size of government. Credit unions do not need taxpayer assistance to encourage them to do more business lending; credit unions only need authority from Congress.

Congress should enact the Credit Union Small Business Jobs Creation Act (H.R. 688) which would allow well-capitalized credit unions operating near the business lending cap to increase their business loan offerings to 27.5% of total assets, if they receive approval by the NCUA. This approach has been endorsed by the Obama administration.

Member Business Lending Talking Points
One page document outlining the major arguments in favor of the Credit Union Small Business Jobs Creation Act.

Small Business Coalition Letter of Support
A growing coalition of small business groups and think tanks have joined together to support the Credit Union Small Business Jobs Act.

MBL Objection Response Summary
Banking trade associations have raised objections to the Credit Union Small Business Jobs Creation Act. This document is a summary of CUNA’s response to the objections that have been raised.

MBL Objection Response - Full Analysis
Read the full analysis of CUNA’s response to objections made to the Credit Union Small Business Jobs Creation Act.

Setting the Record Straight
The American Bankers Association sent a communication to the Hill in April 2012 regarding the Credit Union Small Business Jobs Creation Act; CUNA set the record straight.

Setting the Record Straight Again
When the ABA tried again to encourage lawmakers to oppose the Credit Union Small Business Jobs Act, CUNA set the record straight once again.

Letter of Support for Increasing the Credit Union MBL from Treasury Secretary Timothy Geithner
The Obama administration helped develop the approach that the Credit Union Small Business Jobs Act takes to raising the member business lending cap.

State-by-State Numbers
State-by-state estimates of job creation and additional lending that would result from the enactment of the Credit Union Small Business Jobs Creation Act.

Legislative Language – H.R. 688
Legislative language and a list of cosponsors of the Credit Union Small Business Jobs Creations Act from THOMAS.

Additional Materials

CUNA Testimony

Testimony of Brett Martinez, President and CEO, Redwood Credit Union - 6/21/12
House Small Business Committee Subcommittee on Investigations, Oversight and Regulations

Testimony of Maria J. Martinez, President & CEO Border Federal Credit Union - 3/14/12
House Subcommittee on Financial Institutions & Consumer Credit

Testimony of Jeff York, President and CEO, Coasthills FCU - 10/12/11
House Financial Services Committee, Subcommittee on Financial Institutions and Consumer Credit

Testimony of Bill Cheney, President and CEO Credit Union National Association - 6/16/11
Senate Banking Committee

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