EUGENE, Ore. (3/26/14)--Mandy Jones, president/CEO of $1.2 billion-asset Oregon Community CU, Eugene, Ore., offered four reasons why credit unions are a better financial services choice for businesses in a recent blog post.
"My mentor was my dad, who owned a small business in Milwaukie, Oregon," Jones wrote. "He taught me the importance of businesses being involved in their community and the joy of making a difference in people's lives. He was not surprised when I chose to work in credit unions."
The benefits a credit union can provide to a small business, cited by Jones, include:
- Credit unions can make special arrangements when times get tough. Jones said the focus is always clear at credit unions: Providing access to credit for people who could not seem to get it at the local bank. Even during the economic downturn, credit unions continued to make loans when banks turned small businesses away.
- You actually own the place. "Credit unions are member-owned, not-for-profit financial cooperatives," Jones said. "That means everyone who becomes a member owns a piece of the rock. No shareholders. No paid board of directors focused on profits. Every decision the credit union board and management makes takes members into consideration first."
- Credit unions give back. In 2012, Oregon credit unions--for instance--returned $110 million to members in the form of lower loan rates, free checking, higher rates on savings and other benefits--an average of $152 per credit union household. "That's real money our members didn't spend to get access to vital services like credit and a safe place to keep savings," Jones wrote.
- Credit unions are "the kindler, gentler financial institutions." Credit unions have built a reputation for giving back to their communities, Jones said. "Community service is in our DNA," she wrote. For example, Oregon Community CU is the single largest corporate scholarship sponsor at the University of Oregon. The credit union donated over half a million dollars, and its employees volunteered more than 2,000 hours in community service last year.
The Credit Union National Association is pressing the U.S. Congress to increase the member business lending cap to 27.5% of assets, from the current 12.25%-of-assets level so credit unions can do even more to support the small business lending needs of their communities.
CUNA estimates the MBL cap change would help credit unions lend an additional $13 billion to small businesses in just the first year after enactment of a statutory change. This money, which would be made available at no expense to taxpayers, would in turn help small businesses create around 140,000 new jobs.