Arrha President Testifies on Bill to Modernize Credit-union Laws
SPRINGFIELD — Michael Ostrowski, president and CEO of Arrha Credit Union, testified on an act to modernize credit-union laws before the state Joint Committee on Financial Services. Ostrowski testified on allowing technological advances, increasing transactional authority for chartering and merging credit unions, and increasing state authority for low-income designation.
“A top priority of Arrha Credit Union is to be able to fully utilize today’s advances in technology. We are not allowed to offer electronic loan applications, along with other credit unions. Our members want technological convenience in today’s advanced electronic world,” Ostrowski said. “Also, mail was meaningful during the time this law was enacted; however, today’s electronic voting has largely taken the place of mail ballot voting, and is more easily accessible for members to actively participate in our governance. Such technological advances will provide convenience, time-saving opportunities, and cost-saving opportunities. It is important for Arrha Credit Union to stay as technically advanced as possible to best serve our membership and communities.”
Arrha Credit Union supports the provisions of this bill, which allows the Massachusetts commissioner of Banks to recognize the credit-union low-income designation for state-chartered credit unions. A credit union that receives the low-income designation is a credit union in which has more than half of its members have a family income 80% or less than the median family income for the metropolitan area where they live or national metropolitan area, whichever is greater. This authority will open an opportunity for credit unions to gain access to grant money to provide additional training opportunities for its staff, better and more tailored products for its low-income base, and other such improvements. It will also allow for expedited and easier recognition of credit for Community Reinvestment Act purposes.
“Arrha Credit Union is considered a low-income-designated credit union and has used its low-income designation in the area of auto lending with 100% loan-to-value ratios, which allows us to better and more timely serve our members,” Ostrowski said. “It is clear that values and general banking business dynamics change very quickly in this day and age; as a result, it is necessary that our laws are also kept up-to-date, modernized, with today’s needs.
