adminAs the country recognizes the contributions and sacrifices of service members during National Military Appreciation Month, the NCUA is expanding its approach when considering military personnel in determining if a credit union qualifies for the low-income designation per an announcement May 7.
To qualify as a low-income credit union, a majority of the credit union’s membership must meet certain low-income thresholds, based on data from the Census Bureau and requirements outlined in the NCUA’s Rules and Regulations.
Under the new approach, military personnel will now be considered in a similar manner as students attending colleges, universities, vocational or technical schools when the NCUA evaluates a federally insured credit union’s low-income designation.
Active-duty military personnel constitute a mobile population with frequent transfers, both domestically and internationally, and often list Army/Air Post Office (APO) or Fleet Post Office (FPO) mailing addresses. Prior to the change in the designation’s methodology, the NCUA’s income assessment tool only geo-coded the incomes of members with physical street addresses. As a result, service members using APO or FPO addresses were omitted from the agency’s evaluation.
There are several benefits for credit unions that carry a low-income designation including an exemption from the statutory cap on member business lending, eligibility for grants and loans from the Community Development Revolving Loan Fund, the ability to accept deposits from non-members, and the authorization to obtain supplemental capital.
Additional information about the updated methodology and the new options credit unions now have to incorporate their military members into the low-income designation process will be detailed in an upcoming Letter to Credit Unions.
Credit unions should contact the NCUA’s Office of Credit Union Resources and Expansion at DCAMail@ncua.gov or 703.518.1150 for additional information.
