The NCUA’s fifth Diversity, Equity, and Inclusion Summit was hosted in Minneapolis, Minnesota last week from July 9-11th. The event is aimed at creating an opportunity for credit union professionals to “explore the value proposition of diversity, equity, and inclusion in the credit union industry and at the NCUA; share best practices; develop solutions to industry-specific challenges; and network with one another.”
The theme for this year’s summit was “DEI: Here to Stay,” referencing both the commitment of credit unions in providing access to financial services for all communities and the commitment of those credit unions in supporting DEI programs.
All three members of the NCUA’s Board of Directors—NCUA Chairman Todd M. Harper, Vice Chairman Kyle Hauptman, and Board Member Tanya Otsuka—all spoke about the importance of DEI at the conference. Oddly though, not one of them attended in person.
Chairman Todd Harper addressed the shrinking middle class and the role credit unions play in helping it grow again by supporting those in need of economic help and stability. In doing so, credit unions will naturally aid DEI and lift marginalized communities, he stated.
“Credit unions, in fact, have both a statutory responsibility and a moral obligation to facilitate the economic mobility needed for effective democratic governance,” said Harper. “By following their statutory mandate of meeting the credit and savings needs of their members, especially those of modest means, credit unions can establish a firmer foundation on which financial stability for a growing middle class and a stronger national union can be built for future generations. And, in achieving that important mission, credit unions will help all Americans, regardless of the color of their skin, sex, age, religion, disability, or orientation, climb the economic ladder and strengthen our democracy.”
Vice Chair Kyle Hauptman commented on DEI as it relates to credit union charters, focusing on the importance of supporting new credit union charters and protecting existing credit unions so that they may provide their communities with the financial services they need. If a credit union fails or merges, he said, the NCUA should never be “part of the eulogy.”
“Real financial inclusion at the NCUA primarily means making sure we are not harming anyone’s ability to have their own credit union. Every single credit union started with a story, a need, a group of people who wanted their own banking institution. So, true DEI means it is my job—and yours—to make sure each of the 4,600 remaining credit unions has every opportunity to keep operating for as long as they and their field of membership want.”
Hauptman also stressed the NCUA’s role should not be to tell credit unions how to increase financial inclusion or what amount of diversity to have, as credit unions are by nature inclusive and diverse, and that their field of memberships should dictate those things.
“Credit unions were the original answer to financial inclusion. The credit union movement is by definition diverse. We have credit unions formed around faith-based groups, we have credit unions formed around ethnic groups…there are credit unions amongst Native American tribes, we have credit unions formed around employee groups…and that is why it is so important that none of us at NCUA infer that any given credit union has the wrong demographic…these are decisions for the credit union to make, not their regulator or insurer.”
Board Member Tanya Otsuka addressed underbanked and underserved communities, along with banking deserts, and the lack of trust these communities have in financial institutions. By committing to DEI initiatives and ensuring credit union staff reflect the communities they serve, they are more likely to gain the trust of the marginalized and grow as a result. All of which will support a more equitable financial future.
“Diversity, equity, inclusion, and accessibility within the credit union system is so critical, especially because credit unions are community-focused financial institutions. If the credit union doesn’t have representation from its community — from the board room to the front-line staff — it may be harder for the credit union to build trust and acceptance from the community it serves. We want credit unions to continue to grow and attract new members, and to carry out their mission of providing financial services to people of modest means.
We know that many communities have limited access to safe and affordable financial services, and the most marginalized are disproportionately impacted by this lack of access,” Otsuka continued. “The unbanked and underbanked often cite a lack of trust, high fees, and high minimum account balances as significant barriers. And, racial disparities in lending still exist today across income levels…A commitment to DEIA principles alone will not close the racial wealth gap or put an end to all geographic and socio-economic disparities. But it does contribute to a more equitable financial system and result in greater access to financial services, which benefits institutions and consumers alike.”
You can read the full remarks given on the NCUA’s website. To learn more about the DEI Summit, visit the event page.
