Removing Barriers Blog

CUNA writes to Chairwoman Waters with feedback on Phase 4
Posted April 16, 2020 by CUNA Advocacy

CUNA wrote to Chairwoman Waters to engage on the Phase 4 of COVID-19 legislation. The letter comments on aspects of proposed legislation in the works, highlights areas where credit unions have concerns, and lists additional credit union priorities.

The COVID-19 pandemic has presented small businesses, consumers, and community-based financial institutions with an unprecedented challenge. Nonetheless, CUNA is confident that credit unions will be able to continue delivering critical financial services to members throughout the duration of the pandemic. 

CUNA comments on several aspects of proposed legislation already in the works, including:

  • Support for increased funding for the Treasury’s Community Development Financial Institution (CDFI) Fund;
  • Support for extending the Government Sponsored Enterprise (GSE) Qualified Mortgage (QM) Patch which has played a critical role in ensuring access to affordable, responsible mortgage credit for credit union members, many of which are traditionally underserved;
  • Support for directing the Federal Reserve to provide zero-percent interest rate loans to community financial institutions to ensure they can continue to serve their communities and staff members;
  • Concerns over the prohibitions on overdraft services and debt collection processes, as CUNA believes a broad ban on such services would ultimately impact the affordability of products and services.

In addition, CUNA offered additional other credit union priorities and concerns, including:

  • Eliminating, permanently or temporarily, the six transfer per month limit under Regulation D;
  • Issues with the Paycheck Protection Program, such as the two-year loan term (the CARES Act that funds the PPP allows for up to a 10-year limit) and the fact that credit unions cannot be borrowers under the PPP;
  • Calling for legislation that exempts credit union business loans made during federally declared disasters and emergencies from the credit union member business lending restriction;
  • Calling for enacting of a federal law permitting remote notarization;
  • Delaying the current expected credit loss (CECL) standard implementation until January 2024;
  • Establishing the expanded Central Liquidity Facility through at least 2021; and
  • Providing an emergency infusion of $3 million to NCUA’s Community Development Revolving Loan Fund.