Bill Overview
Title: Expanding Financial Access for Underserved Communities Act
Description: This bill eases credit union membership requirements to allow more access for persons in underserved areas. A credit union must, however, submit a business and marketing plan to the National Credit Union Administration explaining the credit union's ability and intent to serve such population. The bill also excludes loans made to members in underserved areas from certain credit union limits on member business loans.
Sponsors: Rep. Waters, Maxine [D-CA-43]
Target Audience
Population: People living in underserved areas worldwide
Estimated Size: 55000000
- The bill aims to expand financial services access to individuals living in underserved areas.
- Underserved areas often include both urban and rural populations that lack sufficient access to traditional financial institutions.
- By targeting credit union membership expansion, the bill primarily impacts individuals who are currently financially underserved.
- Globally, a significant portion of the population lives in areas that are considered financially underserved.
- The term underserved areas can encompass numerous communities worldwide, particularly in developing regions.
Reasoning
- The policy primarily targets individuals in underserved areas, improving their access to financial services through credit unions.
- Many urban and rural communities in the US lack traditional banking services, making this policy impactful on their financial wellbeing.
- Wellbeing is assessed by Cantril's Ladder, which measures individuals' perceived quality of life on a 0 to 10 scale.
- Considering a budget limit, the policy will initially have a low to medium impact on wellbeing for many, with potential for long-term improvement.
- People not financially underserved are less likely to be impacted directly, unless the ripple effect on community dynamics indirectly benefits them.
Simulated Interviews
Small business owner (Detroit, MI)
Age: 42 | Gender: female
Wellbeing Before Policy: 4
Duration of Impact: 20.0 years
Commonness: 5/20
Statement of Opinion:
- The policy could significantly help my business grow by giving me access to affordable financing.
- I hope the community will also benefit from better support for local businesses.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 6 | 4 |
| Year 2 | 7 | 4 |
| Year 3 | 7 | 4 |
| Year 5 | 8 | 5 |
| Year 10 | 8 | 5 |
| Year 20 | 8 | 5 |
Junior high school teacher (Rural Alabama)
Age: 28 | Gender: male
Wellbeing Before Policy: 5
Duration of Impact: 10.0 years
Commonness: 10/20
Statement of Opinion:
- I might finally get a chance to switch to a better financial institution that offers more personal services.
- I've been wanting to manage my money better, and this could help.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 6 | 5 |
| Year 2 | 6 | 5 |
| Year 3 | 7 | 5 |
| Year 5 | 7 | 6 |
| Year 10 | 7 | 6 |
| Year 20 | 7 | 6 |
Healthcare worker (Chicago, IL)
Age: 34 | Gender: female
Wellbeing Before Policy: 6
Duration of Impact: 5.0 years
Commonness: 8/20
Statement of Opinion:
- I'm hopeful about this policy. More accessible financial services could help me save for emergencies.
- It's about time more people around here got a break.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 7 | 6 |
| Year 2 | 7 | 6 |
| Year 3 | 8 | 6 |
| Year 5 | 8 | 7 |
| Year 10 | 8 | 7 |
| Year 20 | 8 | 7 |
Unemployed (Fresno, CA)
Age: 50 | Gender: male
Wellbeing Before Policy: 3
Duration of Impact: 15.0 years
Commonness: 6/20
Statement of Opinion:
- If this policy can help me access better financial services, it might make finding a job in my area easier.
- I've been struggling to manage fees, so any improvement is welcome.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 5 | 3 |
| Year 2 | 6 | 3 |
| Year 3 | 6 | 3 |
| Year 5 | 7 | 4 |
| Year 10 | 7 | 4 |
| Year 20 | 7 | 4 |
Retired (Appalachia)
Age: 60 | Gender: female
Wellbeing Before Policy: 4
Duration of Impact: 20.0 years
Commonness: 7/20
Statement of Opinion:
- I'm skeptical but hopeful. Any policy that promises more financial support is worth a try.
- Credit unions seem like they could be more community-focused than big banks.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 5 | 4 |
| Year 2 | 5 | 4 |
| Year 3 | 5 | 4 |
| Year 5 | 6 | 5 |
| Year 10 | 6 | 5 |
| Year 20 | 6 | 5 |
Freelance graphic designer (Brooklyn, NY)
Age: 30 | Gender: female
Wellbeing Before Policy: 5
Duration of Impact: 5.0 years
Commonness: 9/20
Statement of Opinion:
- I've had trouble finding financial services that cater to freelancers.
- Increasing credit unions here could mean better financial offers for people like me.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 6 | 5 |
| Year 2 | 6 | 5 |
| Year 3 | 7 | 5 |
| Year 5 | 7 | 6 |
| Year 10 | 7 | 6 |
| Year 20 | 7 | 6 |
Factory Worker (Houston, TX)
Age: 41 | Gender: male
Wellbeing Before Policy: 5
Duration of Impact: 10.0 years
Commonness: 9/20
Statement of Opinion:
- Access to finance in my area is tough. It would be nice to have someone local to talk to about loans and investments.
- I rely on some credit, and lower rates could be a game-changer.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 6 | 5 |
| Year 2 | 7 | 5 |
| Year 3 | 7 | 5 |
| Year 5 | 8 | 6 |
| Year 10 | 8 | 6 |
| Year 20 | 8 | 6 |
College Student (Atlanta, GA)
Age: 21 | Gender: other
Wellbeing Before Policy: 4
Duration of Impact: 10.0 years
Commonness: 10/20
Statement of Opinion:
- This policy could help students like me with managing finances better in underserved areas.
- I think it could improve our financial literacy too.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 5 | 4 |
| Year 2 | 6 | 4 |
| Year 3 | 6 | 5 |
| Year 5 | 7 | 6 |
| Year 10 | 7 | 6 |
| Year 20 | 7 | 6 |
Construction Worker (Phoenix, AZ)
Age: 39 | Gender: male
Wellbeing Before Policy: 4
Duration of Impact: 15.0 years
Commonness: 10/20
Statement of Opinion:
- I've been caught off guard by financial ups and downs. This kind of policy could provide stability.
- I like the idea of having a local credit union that knows community needs.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 5 | 4 |
| Year 2 | 6 | 4 |
| Year 3 | 7 | 5 |
| Year 5 | 7 | 6 |
| Year 10 | 8 | 6 |
| Year 20 | 8 | 6 |
Waitress (San Francisco, CA)
Age: 26 | Gender: female
Wellbeing Before Policy: 4
Duration of Impact: 5.0 years
Commonness: 8/20
Statement of Opinion:
- Any financial assistance here would be a relief given how expensive it is to live here.
- With salaries not moving much, we need more affordable financial options.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 5 | 4 |
| Year 2 | 5 | 4 |
| Year 3 | 5 | 4 |
| Year 5 | 6 | 5 |
| Year 10 | 6 | 5 |
| Year 20 | 6 | 5 |
Cost Estimates
Year 1: $550000000 (Low: $400000000, High: $700000000)
Year 2: $500000000 (Low: $350000000, High: $650000000)
Year 3: $480000000 (Low: $330000000, High: $630000000)
Year 5: $450000000 (Low: $300000000, High: $600000000)
Year 10: $425000000 (Low: $280000000, High: $570000000)
Year 100: $400000000 (Low: $260000000, High: $550000000)
Key Considerations
- Easing membership requirements for credit unions could face opposition from traditional banks due to competitive concerns.
- The credit union sector's capability to scale up operations efficiently and effectively in response to increased membership demand is crucial.
- The success of this policy is contingent upon the credit union's ability to provide attractive services and sufficiently serve new members without sacrificing financial stability.