DCUC Presses Congress to Advance Veterans Member Business Loan Act
By CU Today Staff —
WASHINGTON--The Defense Credit Union Council is sending its new policy white paper to members of Congress, urging passage of the Veterans Member Business Loan Act before the 119th Congress ends.
The paper documents financing barriers facing veteran entrepreneurs and explains how targeted relief from the credit union business lending cap would expand their borrowing options.
“Veterans bring leadership and experience to the businesses they build. They deserve access to responsible financing that helps put those strengths to work,” said Anthony Hernandez, DCUC President/CEO, Ret. U.S. Air Force Colonel. “Credit unions have relationships with military families that continue long after service ends. Congress should give them greater flexibility to support a veteran’s next chapter as a business owner.”
Federal law generally limits covered credit unions’ member business lending to 12.25% of assets, subject to exceptions and a potentially lower limit based on net worth. That ceiling applies to the lender’s overall business loan portfolio. It can prevent a credit union from making an otherwise sound loan to a veteran even when the institution has the resources and expertise to lend, DCUC noted.
“A cap on a credit union’s total business lending says nothing about whether a veteran can repay a particular loan,” reminderd Jason Stverak, DCUC chief advocacy officer. “When a qualified borrower and a capable lender are ready to move forward, federal law should allow them that opportunity. Congress should pass this bipartisan bill before the 119th Congress ends.”
DCUC’s white paper, “Unlocking opportunity for those who served: The Veterans Member Business Loan Act explained,” draws on federal research showing that veterans face distinct financing challenges:
As introduced, H.R. 507 and S. 110 would exclude qualifying credit made to veterans from the cap. They create no new federal lending program, appropriate no new loan funds, and provide no new government guarantee. Credit unions would use their own resources and remain responsible for underwriting, capital, liquidity, and safe lending practices.
DCUC is urging the House Financial Services Committee and Senate Banking Committee to advance the legislation and congressional leaders to secure a path to enactment this year, including through an appropriate legislative package.
“It's time to turn bipartisan support into a vote and expand financing opportunities for our Nation’s veterans,” said Stverak.
Originally reported by CU Today.