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Serving the Underserved

​​​​​The NCUA is primarily focused on ensuring the safety and soundness of the credit union system. As an adjunct to that mission, the agency developed initiatives to facilitate credit unions more effectively serving their memberships, especially those in underserved areas. The Federal Credit Union Act, governing this agency and federally insured credit unions expects this national system to meet "...the credit and savings needs of consumers, especially persons of modest means."

Expanding Into Investment Areas

Any federal credit union with a multiple common bond field of membership may include in its field of membership, without regard to location, communities satisfying the definition of underserved areas. These communities must be located within what is known as an "Investment Area" as defined in Section 103(16) of the Community Development Banking and Financial Institutions Act of 1994. Chapter 3, Part 3 of the NCUA Chartering Manual details the seven criteria included in an Investment Area.

Chapter 2, Section III.B.3 of NCUA’s Chartering Manual states the proposed area must display “significant unmet needs for loans or for one or more of the financial services credit unions are authorized to offer. Credit unions must show the proposed area is “underserved by other depository institutions;” they typically demonstrate that by using the facilities test described in the Manual. The NCUA Board in 2016 approved an alternative by amending the rule to include counties the Consumer Financial Protection Bureau designates as underserved as qualifying.

Provided is the CFPB’s underserved county list in the U.S. The CFPB used 2018 HMDA data to determine “underserved” county status for calendar year 2019, for certain purposes. For additional information, the CFPB’s interpretive rule explains how the Bureau defines “underserved.”

Empowerment Zones

The Empowerment Zone and Enterprise Community initiative is a key element of the government's job creation strategy for America. Its purpose is to create jobs and business opportunities in the most economically distressed areas of inner cities and the rural heartlands.

The program provides tax incentives and performance grants and loans to create jobs and expand business opportunities. It also focuses on activities to support people looking for work, job training, childcare and transportation. This initiative is different from other similar efforts because the community itself determines through written or quantifiable goals how the money will be spent and what results of the activity will be.

The areas designated as Enterprise Communities and Empowerment Zones are listed on the Department of Housing and Urban Development's website.

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