Matz: Credit Unions Can Help Raise Members’
Standard of Living
NCUA Board Member Discusses Opportunities with Credit Union Leaders
at NAFCU Congressional Caucus
September 28, 2004, Washington, D.C. – In today’s opening keynote speech to the National Association of Federal Credit Unions Congressional Caucus, NCUA Board Member Debbie Matz suggested that “credit unions can play a pivotal role in improving the quality of life across America.”
“Unfortunately”, Matz explained, “disturbing new Census data show that the standard of living for millions of people has been declining in recent years. All across America, in cities as well as rural areas, the vast majority of workers are losing real income – and many are falling below the poverty line. The national poverty rate is now 12.5%, up from 11.3% in 2000. More than 36 million people – one out of every eight people in America – are in poverty. This means families with two children are struggling to live on incomes below $18,660 a year. A staggering 28% of single mothers are living on even less.”
“For more and more hard-working people in America,” Matz related, “achieving a higher quality of life remains only a dream. But in reality, this presents important opportunities for credit unions. Just as your predecessors were when the Federal Credit Union Act was enacted 70 years ago, you are now in position to help reduce poverty and raise the standard of living for millions of new members from all walks of life.”
Matz shared many opportunities for credit unions to “turn that dream into reality for more people in your field of membership.” For instance:
Alternatives to Predatory Lending – “Offering small loans can make a huge difference to people who have urgent needs, such as $200 to fix their car so they can get to work, or $300 to cover a medical emergency. These loans are generally at higher interest rates than credit unions’ conventional loans, but they are much more affordable than predatory loans. Most important, many of the people who receive small loans from credit unions become loyal members who will not be lured back to predatory lenders.”
- Risk-Based Loans – “Risk-based lending protects safety and soundness by charging higher rates for higher credit risks, while extending loan opportunities to more of the people who need them most. It ensures that just about everyone – even C and D borrowers – can be approved. Risk-based lending will not only bring new members to your doors. It will put these members on firmer financial footing – so in the future they will begin to build wealth.”
- Affordable Mortgages – “You will find tremendous opportunities when you look to people who don’t yet own their first homes. For example, barely half of all minority households own their homes, and homeownership continues to elude many working poor families. By partnering with other organizations to provide mortgages with no down payments, low interest, and reduced fees, credit unions can help more Americans achieve the dream of homeownership.”
- Financial Literacy – “Credit unions offer world-class financial literacy programs for every age and income group, in just about any language spoken in their field of membership. Programs teach basic financial skills but also can extend into more sophisticated areas such as investment classes, one-on-one financial planning advice and credit counseling.” Matz challenged attendees to make a commitment to helping everyone in their field of membership become financially savvy.
As the 400 Caucus attendees prepared to visit Capitol Hill, Matz suggested that “lawmakers need to hear about the good and worthy causes that credit unions are undertaking to help their constituents – especially constituents who are not served by other insured institutions. So when you reach out and help more people in your field of membership, this will give Congress more reasons to preserve your credit unions’ tax exemption.”
Looking forward, Matz concluded, “Whether you’re making small loans to help people survive financial emergencies; refinancing predatory loans to break the endless cycle of debt; or helping renters realize the dream of owning their own homes, many of these new members will stay loyal to your credit union for life. These loyal members will give credit unions even greater potential to grow in the future.”
For the full text of Board Member Matz’s speech to NAFCU’s Congressional Caucus, visit http://www.ncua.gov/news/speeches/speeches_matz.html
Recommended by Senate Democratic Leader Tom Daschle (D-SD), Matz was named as a recess appointee to the NCUA Board in January 2002 and nominated to a seat on the Board on February 27, 2002. The U.S. Senate confirmed her on March 22, 2002. As part of the NCUA Board, Ms. Matz oversees the regulation of federal credit unions and the administration of the federal insurance fund covering approximately 9,500 credit unions in the U.S.
A public service veteran of nearly 25 years, Matz is a member of three credit unions and resides in McLean, Va. with her husband and two children. Before her appointment to the NCUA Board, Matz was appointed by President Clinton as Deputy Assistant Secretary for Administration in the Department of Agriculture.
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