Q. What is CRI and why is it important?
A. The Community Reinvestment Initiative (CRI) is a strategic commitment by credit unions to build stronger neighbor-hoods and communities in Michigan through improving the financial well being of current and potential members, including those of modest means. At its heart, CRI has two basic objectives:
• Develop additional programs to strengthen Michigan communities by expanding services to under-served communities and people of modest means;
• Develop ways to document and track existing practices of Michigan credit unions related to fulfillment of their social mission; and to report that information to key audiences.
CRI seeks to assist credit unions by not only developing and documenting services credit unions can offer to their members and communities, but also by aiding them in the collection and dissemination of information related to their current social activities.
Q. What are the components of CRI?
A. The CRI Task Force has identified six priorities and established six working groups. The six priorities and working groups are Shared Branching, Financial Literacy, Student Loan, Community Involvement, Affordable Financial Services and “ Cool Cities” (Lending). Each of these groups has been charged with developing programs that will assist credit unions in better serving their members and communities.
Q. What is involved in CRI participation?
A. CRI involvement requires a two-tiered approach for credit unions. First, credit unions must be willing to document their community activities, key statistics, and best practices by completing the CRI Survey. This survey is a powerful tool to relay the good deeds in which credit unions are actively involved to both the public and lawmakers.
The second approach is for credit unions to commit to adopting a formal community involvement strategy. This commitment by credit unions will yield significant benefits for members and consumers, because it is basic “good business” for the credit union.
Q. Why is CRI in the news lately?
A. CRI was an initiative started by the MCUL in early 2004 as a way to combat growing criticism by the banking industry, community groups and some members of Congress that credit unions had strayed from their original social mission. CRI was also seen as an opportunity for expanding credit unions’ good works on behalf of members and their communities. Many have taken an interest in how credit unions are serving their communities, and in Michigan’s CRI program in particular, as a result of the U.S. House Ways and Means Committee hearings last November on the tax-exempt status of credit unions. As a result, Committee Chairman Bill Thomas, R-Calif., said he was concerned by the credit union movement’s inability to document information that would support its arguments that credit unions are fulfilling their social mission and should retain their tax status. He specifically requested more “transparency” from credit unions, more documentation and Community Reinvestment Act (CRA) data.
Q. Why should credit unions participate in something that is not mandated?
A. This question inevitably comes up, “With all of the other legally mandated reporting and regulations, why should credit unions voluntarily take the time to complete the CRI survey?” Part of this answer is so that when banks clamor for credit union taxation and insist that credit unions are really no different from banks, maintaining a record of credit union social responsibility will give us more than anecdotal stories to refute their claims. We’ll have documented proof.
Q. What does the MCUL hope to achieve through CRI?
A. CRI is an opportunity to clearly differentiate credit unions from for-profit financial institutions. Credit unions, at their heart, have always focused on serving the needs of their membership, putting service over profit, and helping people achieve their financial goals. A combination of time, an increasing array of expanding financial services, and misleading information from the banking industry have blurred the credit union difference to both the public and legislators. CRI will play a significant role in helping us clarify that difference.