NAFCU urges for House support of MBL relief
NAFCU Vice President of Legislative Affairs Brad Thaler wrote to House leadership Wednesday to call for support for the bipartisan Access to Credit for Small Businesses Impacted by the COVID–19 Crisis Act, H.R. 1471. The NAFCU-sought legislation was introduced Monday by Reps. Brad Sherman, D-Calif., and Brian Fitzpatrick, R-Pa. and would provide a temporary exemption from the credit union member business lending (MBL) cap for loans made to small businesses as they recover from the coronavirus national emergency.
In the letter, Thaler urged members of the House to support the bill and advance it as part of pandemic recovery efforts. Thaler also noted that the current “arbitrary credit union MBL cap serves as a disincentive for many credit unions to focus on small business programs.”
Specifically, Thaler noted, the enactment of the bill would “help encourage more credit unions to establish and enhance member business lending programs designed to help their small business members recover from the COVID-19 pandemic beyond the PPP.”
The bill would allow credit unions to exempt from their MBL cap loans made within the year from when the national emergency that was declared on March 13, 2020, expires to small businesses to aid in their recovery of the coronavirus pandemic. It would also require the NCUA to issue implementing regulations that ensure a credit union’s safety and soundness are not impacted by the loans.
Similar legislation was introduced in the House and Senate last year. NAFCU's advocacy rallied support from more than 60 members of Congress for this MBL relief to be included in coronavirus relief efforts.
The association has long sought relief for credit unions from the arbitrary MBL cap and, amid the coronavirus pandemic, has urged Congress to amend the Federal Credit Union Act to provide credit unions with greater flexibility and relief from the MBL cap so they can increase access to lending to the nation's small businesses that are in need. The association has also worked to garner support from the NCUA Board on this issue.
Read Thaler’s full letter. NAFCU will keep credit unions updated on the bill's status and continue to advocate to Congress ways in which it could provide additional tools to credit unions to better support members amid the pandemic.
Spring 2022 Supervisory Highlights Part II: Mortgage Origination, Prepaid Accounts, Remittances, and Student Loan Servicing
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Fraud, Current Affairs, Credit Unions, Compliance, Risk Management
Add to Calendar 2022-05-16 09:00:00 2022-05-16 09:00:00 Managing Fraud at Credit Unions in an Increasingly Digital World To remain competitive, credit unions are increasingly adopting digital offerings. However, digital growth can lead to increased application fraud. Legacy systems primarily intended to ensure compliance with Know Your Customer (KYC) and Customer Identification Programs are no longer effective. With so much personally identifiable information available, both real and synthetic, newer and more dynamic technologies are required to stop fraud. What’s at stake: The ability to keep up with banks and fintechs increasingly able to provide a seamless digital onboarding experience and access to new products and money right away. Getting it wrong not only means higher losses, but reduced growth in the long term. In the face of this increasingly digital world, it’s not realistic to manually review everything. Newer types of fraud such as synthetic identities often go undetected and can account for up to 10% of chargeoffs. Evaluating the identities of potential new members at onboarding has to be done in an automated fashion using technology that includes phone and email intelligence, as well as other signals to flag high risk applications so they can be more fully vetted. Understanding how to incorporate new technology at account opening and knowing what verification strategies to pursue when you suspect fraud can help credit unions ensure predictable growth with minimal losses. Get the Report: Location NAFCU email@example.com America/New_York public
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