FINANCIAL INCLUSION : THE CIVIL RIGHTS ISSUE OF OUR TIME

Clockwise from top left: NCUA Chair Rodney Hood; CUNA President/CEO Jim Nussle; WOCCU Corporate Communications Manager Greg Neumann; WOCCU President/CEO Brian Branch [PHOTO - COURTESY]
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The head of the independent financial regulatory agency that oversees the United States’ system of federally insured credit unions recently   said that leaders of the sector from across the globe are uniquely positioned to promote and encourage greater financial inclusion for all during a World Council of Credit Unions’ webinar dubbed: ‘An international perspective on financial inclusion, social justice and credit union advocacy.’

“If we create conditions where people can gain access to credit and capital,  break the cycle of debt and dependency  and achieve financial security and resilience for themselves  as well as their families, we’ll have gone a long way toward addressing the inequities that are fueling so many of the social challenges we face. It’s why I believe so strongly that financial inclusion is the civil rights issue of our time,” said National Credit Union Administration (NCUA) chair, Rodney Hood.

Hood further said that credit union leaders must lay emphasis on whether they are doing everything possible in order to reach people with low and moderate incomes, whether they are including the disabled (and differently abled individuals) in their financial inclusions plans and whether they are also reaching people in hard – pressed urban communities or conversely, distressed rural communities where financial service options are limited.

He also stressed that credit unions must use financial technology and continue to introduce innovative financial products that promote greater financial inclusion. “We very much appreciate your words and your call to action for the innovation and commitment that credit unions can provide in terms of financial inclusion and providing access to populations that are underserved,” said Brian Branch, while thanking Hood for his presentation.

International regulations

Branch also pointed out the impact international regulations can have on financial inclusion—and why WOCCU advocates for the fair and proportional treatment of credit unions in front of international standard setting bodies, such as the Basel Committee on Banking Supervision. “ Sometimes the regulatory burden and  constraints can prevent community-based institutions from serving the  underserved population and introducing some of the innovations to people who traditionally have not had access to the formal financial system,” said Branch.

Hood further  said that  NCUA takes a principles-based approach to that dilemma by seeking to deploy international regulations that can help expand financial inclusion—such as providing greater access to payment systems through fintech.

Diversity, equity and inclusion initiatives

He also stressed that the diversity, equity and inclusion efforts that  credit unions undertake must be more than symbolic.

“If we’re just replacing a bunch of holders of Ivy League degrees on the board of directors with a similar group, it’s hard to see how we’ve made an appreciable difference for society. And we’ve certainly done little to address, in a substantive and concrete way, the inequities that are at the root of the stresses and instability our societies struggle with,” said Hood.

Jim Nussle emphasized   that even before the death of George Floy, CUNA was working towards expanding concrete DEI initiatives among its member credit unions in the United States that have a true impact. “It goes to fairness, freedom, civil rights as well as the business case of our credit union. We’re better when we have diversity,” said Nussle. “We’re better when members of an underserved community can look into a credit union and see someone that looks like them or speaks their language and walks in the door.”

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