Three community development credit unions in California have received an interest-free, $1.25 million deposit from Madison, Wis.-based CUNA Mutual Group to stimulate development in their underserved areas.
The zero-interest deposits to credit unions from CUNA Mutual Group are part of the California Department of Insurance's California Organized Investment Network (COIN). The COIN program allocates $2 million annually in tax credits to support $10 million in community development investments. Under the COIN tax credit program, investors invest a minimum of $50,000 as equity or a zero-interest loan with a Community Development Financial Institution for 60 months; in exchange, the investor receives a state tax credit. After 60 months, the loans are repaid.
The three credit unions – Northeast Community FCU in San Francisco; Faith Based FCU in Oceanside; and the California operations of Self-Help FCU, an affiliate of North Carolina-based Self-Help Credit Union – each received one or two deposits of $250,000 and have the discretion about where to spend the investments in their areas to encourage community development.