Federally insured low-income credit unions now can apply for certification as community development financial institutions through a streamlined application process developed by the National Credit Union Administration and the U.S. Treasury’s Community Development Financial Institutions Fund.
“Through CDFI certification, low-income credit unions can better serve their communities,” NCUA Board Acting Chairman J. Mark McWatters said in a news release. “With access to CDFI funding and resources, credit unions can extend their reach and expand access to affordable financial services.”
Under the streamlined application process, low-income credit unions submit data on loan originations and their target markets to NCUA’s Office of Small Credit Union Initiatives, according to the release. If the credit union is determined to qualify to use the streamlined process, NCUA will provide an application form and the data necessary to complete it. The credit union then must complete the application and send it to the CDFI Fund for final determination, the release stated
NCUA is hosting three streamlined CDFI-certification application rounds in 2017. The first is already underway and runs through March 17. The second round runs from May 1 through May 26. The final round runs from Aug. 7 through Sept. 1.
The CDFI Fund is a program of the U.S. Treasury Department which provides financial and technical assistance to qualifying low-income credits or credit unions that serve distressed or underserved communities. NCUA conducted a pilot program in 2016 to test the streamlined application process and as a result five credit unions recently were awarded CDFI certification. NCUA’s began offering the program on a larger scale in December. An online guide provides more details about the streamlined program.
Low-income credit unions that do not qualify for the streamlined program still may obtain a CDFI certification through the CDFI Fund’s standard application process.
To learn more about the streamlined CDFI application process for credit unions, click here.