May 21, 2020

NAFCU advocacy gets relief for CUs despite COVID-19

U.S. CapitolNAFCU's award-winning advocacy team ensures credit union priorities stay in front of Washington's key decision makers, and these efforts have not stopped amid the coronavirus pandemic. Over the past few weeks, the association's advocacy – supported by member credit unions' efforts – has achieved wins and seen progress on several fronts. See the comprehensive list of what NAFCU's been fighting for.

Regulation D transfer limit eliminated

Paycheck protection program (PPP) access, guidance

Member business lending (MBL) cap relief

Expanded access to NCUA's Central Liquidity Facility (CLF)

Support for mortgage servicers

Capital reforms

Current expected credit loss (CECL) standard relief

  • As the coronavirus pandemic has highlighted the potential negative effects of the CECL standard, NAFCU, NCUA, and lawmakers have continued to voice concerns about the standard hindering financial institutions' ability to lend effectively during the recovery. The CARES Act provided temporary relief under CECL through the end of the year, but the standard isn't effective for credit unions until 2023. NCUA's Hood earlier this month backed NAFCU's call for an exemption for credit unions under the standard, arguing that its compliance costs outweigh its benefits. NAFCU maintains that credit unions should not be subject to CECL and will continue to work with FASB and the NCUA to obtain relief for the industry. The association has numerous resources available to credit unions as they prepare to implement the standard.

Additional funding for CU-used programs

  • NAFCU has advocated for additional funding for the Treasury Department's Community Development Financial Institution (CDFI) Fund and NCUA's Community Development Revolving Loan Fund (CDRLF) "as they are important tools for credit unions to have access to funds to help those in underserved and lower-income areas." The NCUA recently announced that the majority of 2020 CDRLF appropriations will be made available for coronavirus pandemic relief assistance, and NAFCU has discussed with the NCUA ways to expand credit unions' access to the CDRLF grant and loan opportunities.
  • The HEROES Act would provide $1 billion for economic support and recovery in distressed communities by providing financial assistance to CDFIs. NAFCU will continue advocating for more funding to ensure low-income and underserved communities have the resources they need to weather the pandemic.

Preventing harmful provisions from being included in COVID-19 relief packages

  • NAFCU has successfully pushed back against attempts to extend the Durbin Amendment of the Dodd-Frank Act – which places a price cap on interchange fees on debit card transactions – to credit cards in the wake of the coronavirus pandemic. Last month, a coalition of advocacy groups echoed NAFCU's concerns of extending the Durbin Amendment in a letter to President Donald Trump and congressional leaders. In addition to these efforts, NAFCU continues to share concerns about altering credit reporting procedures that could negatively impact lenders' operations.

NAFCU has several coronavirus resources available to help credit unions through the pandemic, including newly updated PPP FAQs and an easy-to-read chart outlining regulators' efforts.

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