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NAFCU Congressional Caucus attendees Tuesday heard credit union representatives and NAFCU staff on two hot-button topics – fintech and credit union partnerships and the current lending landscape – during two panel discussions.

NAFCU Vice President of Regulatory Compliance Brandy Bruyere moderated the first panel, which heavily discussed financial institutions' ability to provide loans through the Small Business Administration's (SBA) programs amid the coronavirus pandemic, featuring Director Government Affairs and Regional Urban Development Officer of Visions Federal Credit Union Trish Shermot and President and CEO of ABNB Federal Credit Union Charlie Mallon.

During the panel, the group discussed mitigating credit risk, as well as their specific experiences with the SBA's paycheck protection program (PPP), citing difficulties navigating as guidance from the administration shifted heavily throughout the process.

"It was challenging," said Mallon. "The rules were changing."

"As we all navigate through this together, I do look at the number of loans from [Visions Federal Credit Union], and I think about how many people we helped," remarked Shermot.

The group also noted the benefits and flexibilities included in the Member Business Loan Expansion Act – NAFCU-sought bipartisan legislation introduced last week by Reps. Vicente Gonzalez, D-Texas, and Brian Fitzpatrick, R-Pa.

The bill would allow the NCUA the flexibility to provide credit unions with relief from the 15-year general loan maturity limit under the Federal Credit Union (FCU) Act and raise the de minimis value of what counts toward the member business lending (MBL) cap from $50,000 to $100,000.

Later in the day, NAFCU Director of Regulatory Affairs Ann Kossachev moderated the second panel which primarily tackled the opportunities currently available for credit union partnerships with fintechs to flourish, featuring President and CEO of Members 1st Federal Credit Union George Nahodil and Strategic Resource Management (SRM) Director of Market Intelligence Paul Davis. 

Davis first noted in the panel that “fintechs” is a rather broad term, saying “there are almost limitless ways to define what a fintech is.”

Both Davis and Nahodil agreed on the importance of credit unions getting involved in fintech relationships. On how to better understand fintechs and stay current with financial innovation, Nahodli urged credit unions to seek expertise from third-parties.

“Our people are busy processing loans for members. When you start getting other services that you need to offer, you need to get other people involved. I'd rather join fintechs and partner with them,” he remarked.

Davis also stated that technologies like cryptocurrency will remain in the financial marketplace indefinitely. “A lot of folks look at crypto not as a core profit...but commercial clients might use something like bitcoin,” said Davis.

Kossachev also asked panelists what the potential risks could be for partnering with fintechs.

“Reputational risk. You always have to worry about where legislation and regulation will go, at what point are regulators and CFPB are going to want to step in,” answered Davis. 

On the importance of credit union innovation in comparison to fintechs, Nahodil mentioned not wanting to shy away from the uncertainty and risk.

NAFCU has called on Congress to support efforts that ensure new entities and financial technology companies (fintechs) have oversight and are properly regulated so that they compete on a level playing field with other regulated entities.

The third and final day of Caucus kicks off today, both in-person and virtually; view the agenda here.

Follow along on Twitter with #NAFCUCaucus for live event updates.