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Earlier this week, the Press Herald published an article, “Where are all the bankruptcies experts predicted?” which noted that bankruptcies are down 50% in August from the prior year. Given the far-reaching impact COVID-19 has taken on our economy, it would have been less of a surprise to see that number 50% higher, not lower.
The article argues that delinquencies and bankruptcies have been held at bay because of government stimulus dollars and from efforts taken by credit unions and other financial institutions to initiate loan modifications and payment deferrals. While our collective job is far from done, we can be proud of the role credit unions played in helping members financially navigate the challenges this year has delivered so far.
To put a finer point on the notion that credit unions serve as financial navigators, consider how members trust and rely on us to guide them and look out for their financial interests. Ongoing access to your credit union team and their expertise is a big part of that. Together, we all work hard to build awareness about available resources inside and outside of the credit union and to simplify complex matters. Maine’s Economic Recovery Grant Program is a good example. This initiative was created to help the smallest of our state’s small businesses. On the front-end, credit unions provided guidance to policymakers that more debt is not always the best answer for those facing financial hardship. We also emphasized the importance of including grants in state relief efforts. As a result, our influence can be seen in the program.
Although I don’t have any hard data, I know many credit unions directly made their small business members aware of the program and helped them through the application process. Credit unions and the League also generated broader awareness as seen below through social media and related efforts. Time will tell us more about the program’s impact and how many small businesses it will help, but for those who benefit from receiving a grant, they will appreciate their credit union more for guiding them to it.
As mentioned above, our collective job is far from done as COVID-19 continues to play out. Members will continue to need our support. Like we always have done and always will do, credit unions will help members navigate through good times and bad times. In those efforts, as we always have and will, the League and Synergent will be right by your side doing our part in support of you.