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: Sen. Padilla, Alex [D-CA]
Target Audience
Population: Individuals living in underserved areas globally
Estimated Size: 63000000
- The bill targets individuals living in underserved areas, which typically includes urban and rural regions lacking sufficient financial services.
- Globally, underserved areas can be found in every country, although the specific locations and population sizes will differ.
- The bill specifically mentions credit unions, which are more prevalent and have a different regulatory environment in the United States compared to other parts of the world.
Reasoning
- The policy is designed to enhance access to financial services in underserved areas, which will likely affect primarily those in such areas who have limited access to traditional banking services.
- By easing credit union membership requirements, this policy makes it easier for low-income individuals or those in rural and urban underserved communities to access affordable credit.
- Since the policy impacts credit union loans, small business owners in these communities may benefit significantly, potentially improving their financial wellbeing if they can access better credit terms than available via traditional banks.
- The distribution of the population considered in the simulation includes both people who are highly impacted (e.g., low-income individuals in rural areas) and those who experience no impact (e.g., individuals in well-served urban areas).
Simulated Interviews
teacher (Detroit, MI)
Age: 30 | Gender: female
Wellbeing Before Policy: 5
Duration of Impact: 20.0 years
Commonness: 8/20
Statement of Opinion:
- Access to a credit union would allow me to save more efficiently and manage my debts.
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 |
small business owner (Casper, WY)
Age: 45 | Gender: male
Wellbeing Before Policy: 6
Duration of Impact: 15.0 years
Commonness: 5/20
Statement of Opinion:
- If I could get a business loan from a credit union, I could expand my store and hire more staff.
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 | 9 | 7 |
| Year 20 | 9 | 7 |
retired (Chicago, IL)
Age: 60 | Gender: female
Wellbeing Before Policy: 4
Duration of Impact: 20.0 years
Commonness: 6/20
Statement of Opinion:
- Better savings and credit options would help me afford healthcare and keep up with bills.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 5 | 4 |
| Year 2 | 6 | 4 |
| Year 3 | 6 | 4 |
| Year 5 | 7 | 5 |
| Year 10 | 7 | 5 |
| Year 20 | 7 | 5 |
software developer (New York, NY)
Age: 28 | Gender: male
Wellbeing Before Policy: 9
Duration of Impact: 0.0 years
Commonness: 15/20
Statement of Opinion:
- This policy doesn't have much effect on me, as my banking needs are already met.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 9 | 9 |
| Year 2 | 9 | 9 |
| Year 3 | 9 | 9 |
| Year 5 | 9 | 9 |
| Year 10 | 9 | 9 |
| Year 20 | 9 | 9 |
nurse assistant (Houston, TX)
Age: 33 | Gender: female
Wellbeing Before Policy: 5
Duration of Impact: 10.0 years
Commonness: 7/20
Statement of Opinion:
- More access to credit could help me manage my student loans better.
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 | 7 | 6 |
| Year 10 | 8 | 6 |
| Year 20 | 8 | 6 |
college student (Los Angeles, CA)
Age: 22 | Gender: male
Wellbeing Before Policy: 6
Duration of Impact: 15.0 years
Commonness: 5/20
Statement of Opinion:
- Good credit could help me finance my education and support my family.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 7 | 6 |
| Year 2 | 8 | 6 |
| Year 3 | 8 | 7 |
| Year 5 | 8 | 7 |
| Year 10 | 9 | 7 |
| Year 20 | 9 | 7 |
engineer (Austin, TX)
Age: 52 | Gender: male
Wellbeing Before Policy: 8
Duration of Impact: 0.0 years
Commonness: 14/20
Statement of Opinion:
- This policy likely won't affect me, as I'm well-served by my existing financial institutions.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 8 | 8 |
| Year 2 | 8 | 8 |
| Year 3 | 8 | 8 |
| Year 5 | 8 | 8 |
| Year 10 | 8 | 8 |
| Year 20 | 8 | 8 |
homemaker (Biloxi, MS)
Age: 40 | Gender: female
Wellbeing Before Policy: 4
Duration of Impact: 20.0 years
Commonness: 4/20
Statement of Opinion:
- Joining a credit union could help my family save money on fees and aid in budgeting.
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 | 5 |
| Year 10 | 8 | 5 |
| Year 20 | 8 | 5 |
retired (Phoenix, AZ)
Age: 70 | Gender: male
Wellbeing Before Policy: 5
Duration of Impact: 10.0 years
Commonness: 8/20
Statement of Opinion:
- This policy could allow me to find better financial products tailored to my fixed income needs.
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 |
real estate agent (Miami, FL)
Age: 55 | Gender: female
Wellbeing Before Policy: 7
Duration of Impact: 0.0 years
Commonness: 10/20
Statement of Opinion:
- The policy isn't relevant to me, as I have strong credit and banking relationships already.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 7 | 7 |
| Year 2 | 7 | 7 |
| Year 3 | 7 | 7 |
| Year 5 | 7 | 7 |
| Year 10 | 7 | 7 |
| Year 20 | 7 | 7 |
Cost Estimates
Year 1: $150000000 (Low: $100000000, High: $200000000)
Year 2: $150000000 (Low: $100000000, High: $200000000)
Year 3: $150000000 (Low: $100000000, High: $200000000)
Year 5: $0 (Low: $0, High: $0)
Year 10: $0 (Low: $0, High: $0)
Year 100: $0 (Low: $0, High: $0)
Key Considerations
- There might be challenges in regulatory compliance and oversight as more credit unions expand operations.
- The enactment of the policy might take some time to show full economic and social benefits as credit union expansion materializes.
- A well-implemented marketing strategy is crucial to ensure the targeted population is aware of and trusts the new accessible services.