Kauai Government Employees FCU is Kauai’s First Community Development Financial Institution

on "January 20, 2021 2:03 pm"

As the first and only CDFI on Kauai, KGEFCU is pioneering a new path to help the island economy survive and thrive.

 

Recent Community Development Financial Institution (CDFI) certification by the US Treasury will create access to a lifeline of mission-driven funding for families and small businesses on Kauai.

CDFI certification resources for CUs

NCUA opens streamlined CDFI application process
Federally insured, low-income credit unions seeking Community Development Financial Institution certification can apply to use the National Credit Union Administration’s streamlined qualification process beginning January 24.

CUNA Mutual Group, Inclusiv Launch CDFI Awareness and Certification Campaign
CUNA Mutual Group and Inclusiv have come together to facilitate credit unions’ access to the possible $12 billion for CDFIs and Minority Depository Institutions (MDI) contained in the COVID-19 stimulus package that Congress is presently debating. Inclusiv will provide expertise, technical assistance, advocacy and resources to CDFI-certified, CDFI-eligible and MDI-designated credit unions seeking to participate in these programs.

KGEFCU, founded in 1947, has delivered over 11 million dollars in aid since March, in the form of rent relief, emergency response loans, business boost programs, and start-up investments such as Kauai’s Common Ground Incubator and Accelerator Programs. Managing $147 million in assets, the small Kauai credit union expanded to open a new branch in Kilauea in September. CDFI certification, offered to underserved communities across America, significantly opens up access to new capital that will support recovery and innovation on Kauai.

“We are developing a formidable set of tools to grow new businesses, re-circulating money locally to create a more diverse economy,” says KGEFCU CEO and President Monica Belz. “By growing a more equitable system of capital access, we ensure local talent can flourish and Kauai’s children can remain at home or return home to meaningful jobs.”

The CDFI fund has become the single most important source of external funding for credit unions. Since its inception 25 years ago, it has provided over $400 million in technical and financial assistance grants. CDFI credit unions consistently outperform their peers in growth, earnings, and services. In small widely disbursed investments, these credit unions manage more than $70 billion in combined assets across 46 states, leveraging $12 in private equity for every $1 of public investment capital.

“We are experiencing a true coming of age moment for the credit union movement,” says Belz, who was named Business Executive of the Year by Pacific Edge magazine in November. “I truly believe in the power of our DNA to disrupt the financial industry across the globe, as we rebuild the economy together.”

CDFI Fund awardees, including those in Hawaii, have leveraged local resources many times over using matching funds and other investments from the private sector, philanthropy, and government.

Nationally, hundreds of thousands of jobs and affordable housing units have been created by the CDFI Fund, millions of square feet of space have been developed or renovated for commercial and community service use and tens of thousands of small businesses have been financed.The CDFI approach represents a thriving model of public-private partnership where limited federal resources are used to attract private sector investment into low-income communities. This strategic relationship not only injects vital sources of new capital into economically underserved areas, it also ensures that important investment decisions are made locally by trusted organizations that know their communities best.

CDFI Certified CUs in Hawaii
As of Dec. 16, 2020, there were 11 CDFIs in Hawaii, including four credit unions. With the addition of the Kaua’i Government Employees Federal Credit Union, the five credit union CDFIs have $610.3 million in assets and 50,753 members. The other four are:

  • Hawaii Federal Credit Union, Honolulu ($99.1 million in assets, 13,225 members)
  • Molokai Community Federal Credit Union, Kaunakakai ($30.8 million in assets, 4,090 members)
  • Hawaii First Federal Credit Union, Kamuela ($42.3 million in assets, 8,388 members)
  • Hawaii Central Federal Credit Union, Honolulu ($312.2 million in assets, 17,824 members)