Puerto Rico credit unions could dip into $3B federal revitalization fund
The Public Corporation for the Supervision and Insurance of Puerto Rico Cooperatives (COSSEC, in Spanish) confirmed that local credit unions will be able to access some $3 billion in budgetary allocations included in the new federal economic stimulus package that seeks to revitalize communities with low and moderate resources.
The federal funding bill allocates $3 billion to strengthen the technical capacity and impact of financial institutions in communities affected by the COVID-19 pandemic. Puerto Rico’s credit unions are eligible to receive funds to strengthen their ability to meet the financial needs of the communities they serve, COSSEC officials said.
This allocation of funds is the largest in the history of the Community Development Financial Institutions Fund (CDFI Fund), under the US Department of Treasury, which manages these economic development programs.
“This historic allocation of funds will greatly help credit unions. It’s a sign of the importance of promoting collaboration agreements with the different organizations of the cooperative movement, which result in benefit for them and for Puerto Rico,” said Glorimar Lamboy, chairwoman of the COSSEC Board of Directors.
The $3 billion allocation is divided for three purposes: $1.25 billion that is intended exclusively for organizations that are CDFI certified; $500 million destined to expand traditional CDFI funding rounds; and $1.25 billion to provide grants to financial institutions that serve minority communities, including Puerto Rico credit unions. There are 17 CDFI-certified credit unions on the island.
“Getting this type of funding at a time like the one we’re going through is vital to the survival and optimization of credit unions,” said Emilio Torres-Antuñano, executive president of COSSEC. “It’s also an opportunity for credit unions that do not have the CDFI accreditation to get it.”
The announcement is coupled with a joint initiative between COSSEC, Inclusiv (formerly known as the National Federation of Credit Unions for Community Development) and the Puerto Rico Credit Unions Executives Association (ASEC, in Spanish) to help credit unions prepare to receive the funding.