It’s time for broad-based regulatory relief for credit unions

{mosads}H.R. 688, The Credit Union Small Business Jobs Creation Act, introduced by Reps. Ed Royce, (R-Calif.), and Carolyn McCarthy (D-N.Y.), seeks anew to increase the credit union member business lending cap to a maximum of 27.5 percent of assets for eligible institutions. H.R. 719, The Capital Access for Small Businesses and Jobs Act, was introduced by Reps. Peter King (R-N.Y.), and Brad Sherman (D-Calif.), addressing credit unions’ need for access to supplemental capital. H.R. 749, The Eliminate Privacy Notice Confusion Act, introduced by Sherman and Rep. Blaine Luetkemeyer (R-Mo.), would remove the requirement for financial institutions to mail privacy notices yearly to members even when they don’t change their policies.

The rapid introduction of these legislative remedies confirms the confidence Congress has in credit unions and an understanding of the value credit unions provide to all Americans. This was a key finding of the 2012 landmark NAFCU study on the economic benefits of the credit union federal income tax exemption.

The study showed that without credit unions, all Americans — regardless of credit union membership — would face higher interest rates on their loans, lower interest rates on their deposits, and higher fees.

The findings also demonstrated that the loss of the credit union tax exemption would cost the federal government $1.5 billion in lost tax revenue, $148 billion in gross domestic product and an average of 150,000 jobs per year over the next decade. A copy of the study can be obtained at: www.nafcu.org/cutaxexemption.

Passing NAFCU’s five-point plan would be a great step forward for our country. For example, lifting the cap on credit union member business lending would be a win-win for America’s small businesses and our economy. This common-sense jobs bill could spur more than $13 billion in new lending and create more than 140,000 new jobs in the first year alone — at no cost to taxpayers.  Credit unions are making loans to Main Street small businesses and would like to do more, but they are hamstrung by this arbitrary lending cap.

Whether as individual measures, or collectively, NAFCU is urging our nation’s leaders to implement these critical legislative remedies that will help Main Street’s credit unions continue to serve their 96 million members throughout the country, help create jobs for the struggling middle class, and return our nation’s economy to prosperity. 

Becker is president and CEO of the National Association of Federal Credit Unions.