Credit Union Better Choice Touted As Success Model At Payday Lending Hearing
The Association’s Credit Union Better Choice program was presented as a successful model for small dollar loans during a Senate Banking and Insurance Committee Hearing held yesterday in Harrisburg. The hearing concerned S.B. 1071 and payday lending. Testimony was provided by Department of Banking Secretary Steven Kaplan, Belco Community Credit Union President/CEO Lonny Maurer, along with a consumer advocate and a lending tracking software provider.
During Secretary Kaplan’s testimony, he cited the success that credit unions have had with the Credit Union Better Choice program. With respect to S.B. 1071, Kaplan stated that there is nothing in the structure of small consumer loans that is inherently problematic, but the actual costs to consumers in interest and fees.
Belco Community CEO Maurer detailed the history and statistics regarding the Credit Union Better Choice since its inception in 2006. He further stated the credit union model is not based on making a profit unlike other providers, but instead to better the lives of borrowers. Maurer cited the savings and financial counseling component of Better Choice as further evidence toward this goal.
Association staff attending the hearing included: Christina Mihalik, VP, Governmental Affairs; Christine Seitz, Director, Political Affairs & Fundraising; and Diane Powell, Director, Communications.
Treasurer Recognizes Financial Literacy Month; Promotes Better Choice Loans
Now that Tax Day has come and gone, Pennsylvania Treasurer Rob McCord encourages Pennsylvanians to spring clean their finances this April, which has been proclaimed National Financial Literacy Month by governments and financial organizations across the country.
“Now more than ever, it’s critical that Pennsylvanians take control of their financial lives,” Treasurer McCord said. “As State Treasurer, I want to help Pennsylvanians achieve economic security. National Financial Literacy Month is a perfect time to review our finances and our short and long-term goals. Visit Treasury’s Web site at www.patreasury.org for information on how to get started.”
The Web site provides consumer alerts to protect Pennsylvanians from the latest scams; instructions to obtain free credit reports; and links to reliable and trusted educational resources, including the 529 College Savings Program and Keystone HELP, an energy-saving program.
Treasury’s Credit Union Better Choice Loan program is another resource for Pennsylvanians. This smart alternative to payday lending helps families save more of their hard-earned money. Treasurer McCord is proud to report that since the Better Choice program’s inception, Pennsylvania consumers have taken out more than 28,000 loans totaling more than $13.4 million – and have saved nearly $10 million in interest and fees normally charged by traditional payday lenders.
“Better Choice connects hard-working individuals with the cash they occasionally need for an unexpected expense or between paychecks. It also helps them avoid the debt trap of usurious loans,” Treasurer McCord said.
Interchange Discussions With State Representative
Due to speculation that a state interchange bill could be on the horizon for financial institutions, the Pennsylvania Credit Union Association and the Pennsylvania Association of Community Bankers, in a coordinated effort, met with possible bill sponsor State Representative Sheryl Delozier (R-Cumberland).
The proposed interchange bill would resemble what is currently being debated in the state of Vermont.
The bill would allow the state’s merchants to set minimum transaction amounts for all debit, credit, and charge card transactions, permitting them to reject a customer’s card. The measure also prohibits any fines on merchants for advertising lower prices for using cash or for refusing to take all cards at given locations. To view Vermont’s legislation in its entirety, please click here.
Christine Seitz, Director of Political Affairs and Fundraising, attended the meeting on behalf of the Association to discuss the financial institutions' risk with merchant compromises; their ability to support a cards program; fee structures; losses associated with data breaches; and the lack of merchant responsibility, as well as market shut out.
Representative Delozier has not committed to introducing interchange language but plans to obtain information from all affected parties. The Governmental Affairs staff will maintain dialogue with the Representative and closely monitor this situation.
Compliance Councils Get Understanding Of Reg E and S.A.F.E. Act
Regulation E and the pending S.A.F.E. Act (Secure and Fair Enforcement for Mortgage Licensing Act) were among the topics discussed at Tuesday’s Compliance Council East meeting held in Summerdale. Attorney Andrea Stritzke from Policy Works helped the group understand the new Regulation E rules giving consumers the right to limit overdraft costs associated with ATM withdrawals and one-time debit card transactions. Stritzke reviewed sample disclosure notices and discussed options for alternative plans for covering overdrafts. The group was also updated on the potential impact of the S.A.F.E. Act on real estate lending practices and procedures.
The same program is on the agenda for today’s Compliance Council West meeting in Monroeville.
National Credit Union Foundation Offers New Innovation Grants
Credit union organizations are now eligible to apply for new Innovation Grants from the National Credit Union Foundation (NCUF) through June 30.
Innovation Grants are aligned with NCUF’s signature program, REAL Solutions. However, participation in REAL Solutions is not required to apply for a grant.
NCUF is seeking grant applications in any of REAL Solutions’ five service areas:
- Education: Innovation Grants assist credit union organizations participating in national financial education programs, including Biz Kid$ and the National Endowment for Financial Education (NEFE). Innovation Grants also support other initiatives consistent with the education components of REAL Solutions: financial counseling, product awareness, and staff training.
- Transaction Services: Innovation Grants support transaction services that help credit unions attract underserved consumers. Examples include check cashing, money orders, pre-paid stored value cards, remittances, second-chance/fresh-start checking, and tax preparation.
- Savings: Innovation Grants support programs that help credit union members with low wealth establish and maintain savings. Examples include prize-based savings, safe accounts, savings challenges, and step-up CDs.
- Credit: Innovation Grants support initiatives that help non-prime borrowers build and improve credit through credit unions. Examples include alternative credit reports, citizenship loans, first and last rent loans, flexible loan policies, non-prime used car loans, score builder loans, and thin-file loans.
- Homeownership: Innovation Grants support responsible programs that help credit union members with lower credit scores qualify as first-time homebuyers. Examples include foreclosure assistance loans, green loans, Home Loan Payment Relief (HLPR) mortgages, Individual Taxpayer ID Number (ITIN) loans, and timely repayment rewards.
Eligible applicants include credit unions, CUSOs, state credit union associations, state credit union foundations, and any other organizations owned or controlled by credit unions.
Innovation Grants
What’s Your Game Plan For Youth Week?
Send your news and photos of Youth Week celebrations to highway@pcua.coop. Remember you can still sign up for the National Youth Saving Challenge to enter your results: sign up and report.
Education & Training
Education & Training
NorthLegal Webinar: Managing Chapter 13 Bankruptcy Accounts
The Association, along with other state leagues/associations throughout the country, is a co-sponsor of a NorthLegal Webinar, Account Maintenance During Chapter 13 Bankruptcy, to be presented on Thursday, April 29, at 1:00 p.m. EDT.
During this 90-minute program, attorney Eric North will talk with participants about
- Whether you should (and whether you may) send periodic statements during a Chapter 13 bankruptcy and what problems to avoid if you do — or don't.
- Things to consider if you add attorneys fees, collateral protection insurance, late charges, or other charges to a loan during Chapter 13 bankruptcy.
- How an important case soon to be heard by the Ninth Circuit Court of Appeal may directly or indirectly affect real property creditors nationwide.
For more information or to register, click here.
This program is not state-specific, and will be important to credit unions from around the country.
Chapter News
Chapter News
The Scranton Chapter of Credit Unions will hold its annual Night at the Races on Wednesday, May 12, at the Mohegan Sun at Pocono Downs. Sponsors are needed and everyone is invited to participate in the event, which begins with dinner at 5:30 p.m. Races start at 6:30 p.m. For more information, please contact Carole Hughes, 570-348-9192, ext. 13, or e-mail stefcu1@aol.com.
Newsmakers
Newsmakers
Congratulations to Karen Newman, the new CEO for Riverside Beaver County FCU.
The Greater Pittsburgh Police FCU is today celebrating its 75th Anniversary. Members will gather this evening at the credit union for a free catered buffet dinner, cake, champagne, and giveaways. The annual business meeting will follow.
The Pocono Record (April 18) featured a story about NE PA Community FCU, Stroudsburg, which is celebrating its golden anniversary this year. The article described the differences between credit unions and banks, and gives a brief history of the credit union. Mark Filbert, President/CEO, explained, “We try to give our members low-cost or free services — like online banking and our online bill payer. Our checking account is free. Many of the fees that might be assessed are significantly lower than with other institutions.” Read Article
As a follow-up to the MusicStream event recently held at Old Forge High School, all students were asked to become a fan of the TobyFCU Facebook page (www.facebook/TobyFCU). Everyone who became a fan was entered into two contests. The first contest, for a $50 American Express Gift Card, was awarded to Brian Harrison. “We love educating our members while having fun at the same time. Facebook is a great way to get the students more involved and benefit from the services we offer to them,” said Nina Waskevich, Director of Marketing and Sales, for Tobyhanna Army Depot FCU.
National News
National News
CUNA's Mica, WOCCU delegation in Haiti
MADISON, Wis. and WASHINGTON (4/21/10)--Credit Union National Association President/CEO Dan Mica is part of a delegation of credit unions and organizations, led by World Council of Credit Unions (WOCCU) President/CEO Pete Crear, that will arrive in Haiti today to meet with credit unions and members suffering from the effects of Haiti's Jan. 12 earthquake.
The delegation representing WOCCU, CUNA, state credit union leagues, and major credit unions and associations met in Miami Tuesday for a briefing from WOCCU staff and Kathleen Felix, the Haitian Diaspora liaison to Miami from Fonkoze, a Haitian microfinance organization with offices in the U.S.
Discussion topics included the economic impact of Haitian emigration, financial literacy work and the impact of Haiti's underdeveloped financial infrastructure.
More than 400,000 people in Haiti are served by 220 member-owned credit unions. Several credit unions were destroyed in the 7.0-magnitude earthquake.
"Our challenge will be to help the strongest credit unions get back on their feet to help Haitians help themselves and their communities rebuild their lives through small loans and a safe place to save," Mica said.
While in Haiti, the delegation will visit several caisses populaires (credit unions), all of which have operated from tents since the destruction of their buildings. The tents are donated by WOCCU. (See resource link: "WOCCU tents help Haiti office stay safe, productive.")
WOCCU Haiti program director Greta Greathouse, who led the delegation, has taken on additional work of leading the credit union disaster relief and rebuilding efforts.
WOCCU has been working with Haiti's credit unions since July in a project funded by the U.S. Agency for International Development through the Academy for Educational Development.
Mica and the rest of the delegation will visit damaged credit unions in Port-au-Prince and the earthquake epicenter at Leogane, to hear first-hand how the quake affected staff and members of the credit unions.
Barry Jolette is the chairman of the WOCCU board.
In addition to Mica and Crear, members of the delegation include:
- Sue Albrecht, senior vice president, international division, CUNA Mutual Group, Madison, Wis.;
- Valerie Breunig, executive director, Worldwide Foundation for Credit Unions, Madison;
- Bill Cheney, president/CEO, California and Nevada Credit Union Leagues, Rancho Cucamonga, Calif.;
- Josh Fetting, WOCCU partnership program director, Madison;
- Virginio Gerardo, executive director, Asociacion de Instituciones Rurales de Ahorro y Credito Inc., Santo Domingo, Dominican Republic;
- Linda Hanson, vice president, strategic planning, Schools First FCU, Santa Ana, Calif.;
- Bert Hash, president/CEO, Municipal Employees CU of Baltimore (Md.) Inc.;
- Jose Joaquin Suriel, Asociacion de Instituciones Rurales de Ahorro y Credito Inc., Santa Domingo, Dominican Republic;
- Fred Johnson, president/CEO, Credit Union Executives Society, Madison;
- Barry Jolette, president/CEO, San Mateo CU, Redwood City, Calif.;
- Alan Kaufman, CEO, Melrose CU, Briarwood, N.Y.;
- Mike Muckian, WOCCU senior communications manager, Madison;
- Cassie Rademaekers, WOCCU program specialist, Africa/Asia/Europe, Madison;
- Brett Thompson, president/CEO, Wisconsin Credit Union League, Pewaukee, Wis.;
- Ralph Wharton, CEO, Caribbean Confederation of Credit Unions, Basseterre, St. Kitts and Nevis; and
- Marlene Shiels, WOCCU board member and CEO, Capital CU, Edinburgh, Scotland.
More than 1,000 donors have contributed to the WOCCU Haitian Relief Fund, including U.S. credit unions contributing through CUAid. coop. The fund received more than $1 million in donations from the movements.
For more information on the WOCCU Supporters program or the Haiti Relief Fund, contact Valerie Breunig, executive director of Worldwide Foundation for Credit Unions, at vbreunig@woccu.org or at 608-395-2055.
CUAid.coop (donations from U.S. CUs)
WOCCU Haiti Disaster Relief
Mica thanks legislators for backing fin lit resolution
WASHINGTON (4/21/10)--The House on Tuesday endorsed H. Res. 1257, a resolution that supports the goals and ideals of Financial Literacy Month, which takes place during April.
H. Res. 1257 also contains specific language that backs credit union involvement in National Credit Union Youth Week, which supports increased financial savings by minors. National Credit Union Youth Week concludes on April 25.
In a Monday letter, Credit Union National Association President/CEO Dan Mica thanked Reps. Rubén Hinojosa (D-Texas) and Judy Biggert (R-Ill.) for introducing H. Res. 1257.
In that letter, Mica said that financial literacy is "vital to the well-being of American families and the overall economic health and prosperity of our nation" and, "given the uncertainty in today's financial markets... is more important than ever for all Americans."
Mica also detailed many of the financial literacy endeavors that credit unions take part in during the rest of the year, including direct assistance to the National Endowment for Financial Education's High School Financial Planning Program as it delivers educational materials to over 500,000 students nationwide and funding of the BizKid$ Television Series, a series that promotes financial education for middle and high school students and reaches more than 1,000,000 households per episode.
Mica letter
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