World Council, ENCU, EUCUPIG Call for COVID-19 Regulatory Relief
Letters to several EU officials call for specific reform measures
June 01, 2020
WASHINGTON—World Council of Credit Unions (World Council), the European Network of Credit Unions (ENCU) and the European Union Credit Union Parliamentary Interest Group (EUCUPIG) in two separate letters called for regulatory relief to allow credit unions in the European Union (EU) to play a critical role in the response to the COVID-19 pandemic. Credit unions have a history of providing critical services through disasters, emergencies and other disruptions by providing direct assistance to their members.
With proper regulatory relief, credit unions have the ability to advance financial inclusion during the pandemic. These community-based cooperatives provide services to households, small to medium enterprises (SMEs) and vulnerable groups that face a number of obstacles in accessing credit, particularly during this crisis.
This call for regulatory relief came in a series of letters from World Council and ENCU, with the ENCU letters signed by five Members of the European Parliament (MEPs):
- MEP Billy Kelleher (Co-Chair of EPCUIG - Ireland);
- MEP Paul Tang (Vice-Chair of EPCUIG – The Netherlands);
- MEP Frances Fitzgerald (Ireland);
- MEP Barry Andrews (Ireland); and
- MEP Caroline Nagtegaal (The Netherlands).
“With targeted relief from restrictions that are appropriate during a normal economy, prudential regulators can unlock the potential of credit unions to be a part of the solution of returning the economy to regular functioning levels. We are grateful for the support of EUCUPIG in this call for relief,” said World Council Senior VP of Advocacy Andrew Price.
Some of the items in the call for regulatory relief include:
- Designating credit unions as “Essential” (a designation often extended to banks and other financial institutions).
- Allowing for virtual membership meetings or board meetings (regulations often require in-person meetings).
- Relief from accounting standards for items such as mandated payment moratoriums or mandated stops on collection activities (allows for additional lending to citizens); and
- Allowing for favorable capital treatment to allow access to capital buffers designed to assist with a crisis (allows for additional lending to citizens).
World Council of Credit Unions is the global trade association and development platform for credit unions. World Council promotes the sustainable development of credit unions and other financial cooperatives around the world to empower people through access to high quality and affordable financial services. World Council advocates on behalf of the global credit union system before international organizations and works with national governments to improve legislation and regulation. Its technical assistance programs introduce new tools and technologies to strengthen credit unions' financial performance and increase their outreach.
World Council has implemented 300+ technical assistance programs in 90 countries. Worldwide, 86,055 credit unions in 118 countries serve 291 million people. Learn more about World Council's impact around the world at www.woccu.org.