Calling for SBA clarity on debanking order compliance
America’s Credit Unions voiced support for fair access to financial products and services as outlined in a recent Executive Order, while also urging the Small Business Administration (SBA) to clarify key requirements in its recent debanking letter to lenders.
Emphasizing that credit unions do not engage in politicized or unlawful debanking and instead make decisions based on objective, risk-based criteria, Head of Regulatory Advocacy James Akin stressed that statutory field-of-membership restrictions should not be misconstrued as denial of service.
The letter outlined steps to help ensure effective and consistent compliance, asking the SBA to:
- Clarify what actions constitute politicized or unlawful debanking;
- Define how far back lenders must review past actions;
- Specify what documentation will satisfy the reporting requirement;
- Clarify whether the report is one-time or recurring;
- Confirm if past reliance on reputation risk guidance qualifies as good-faith compliance; and
- Provide supplemental guidance and a standardized reporting template.
Akin also urged coordination with the NCUA and state regulators to align expectations with existing credit union supervision and avoid duplicative burdens.
“We are proud that credit unions have long been champions of financial inclusion, and we welcome the opportunity to demonstrate that commitment through compliance with the Executive Order,” wrote Akin.
America’s Credit Unions met with the SBA earlier this month expressing similar concerns.
Advertisement
