How the Community Impact Fund Helps Credit Unions Generate Prosperity

Sean Galli
How the Community Impact Fund Helps Credit Unions Generate Prosperity

People helping people. 

That’s the mantra of the credit union world, and credit unions channel that mantra into great acts of community service. But what if you’re missing those right in front of you? 

Whether you realize it or not, many of your employees are struggling to make ends meet. As part of a group called ALICE (Asset Limited, Income Constrained, Employed), some credit union employees earn a stable income but still have trouble with expenses – especially when emergency situations arise.

Employee financial difficulties are problems credit unions can’t ignore because these challenges spark a domino effect. What starts at home impacts performance at work. When performance at work declines, member service declines.

Rather than creating prosperity, the opposite occurs. 

So, how do you help the people your members depend on? That’s where The Community Impact Fund (CIF) comes in.

Who is CIF?

CIF is a 501(c)(3) charitable nonprofit helping credit unions reverse the destructive domino effect of employee financial instability. CIF does this by assisting in the establishment of credit unions’ personal Impact Loan Funds. They also manage the program on credit unions’ behalfs.  

The fund allows credit unions to provide a hand to employees seeking financial stability so they can continue making a positive impact on their communities. 

As Courtney Lussenhop, CIF’s Director of Impact, said, “You’re usually not thinking about employees of nonprofits who are doing amazing work but are going home hungry. Financial well-being for all starts in your immediate community and with employees.”

“Employers underestimate the power they hold in the eyes of their employees as a trusted resource for financial stability, especially if you’re a financial institution,” CIF Executive Director Mike Scheid said. “CIF and credit unions have the same mission and goals to help bring employee financial stability to life.”

The primary way CIF and credit unions pursue employees’ financial stability together is through the Impact Loan.

A Game-Changing Loan

The Impact Loan is revolutionary when it comes to creating a culture of financial health within your credit union. What is the Impact Loan?

It’s a 0% interest charitable loan of $500 to $3,000 funded by the credit union and managed by CIF. Interested employees apply through an online portal, and there are flexible terms available. Since CIF reviews applications and distributes funds on behalf of their partners, your employees retain their dignity by remaining anonymous to you and paying the aid forward.

An employee using an Impact Loan pays back into your fund over time, so that money can then go to another employee in need. In other words, it continuously regenerates. There is a big mindset shift when a recipient of a hand-out becomes a participant in a “hand-up” to someone else in need. 

You can even add an extra incentive to the loan - 10% of each payment given back to the borrower to help build emergency savings. According to Lussenhop, “We want the Impact Loan to be something that finally allows people to get out of the hole and onto solid ground. That’s completely fueled by their employer.”

This loan can change your employees’ lives. It also grows your business. 

CIF partner WEOKIE CU said the Impact Loan “has helped not only with the retention rate but also recruitment when we share it during orientation to new hires and our staff.” It’s a great marketing tool to show how your credit union benefits the community, and a healthier workforce means improved productivity. 

As Lussenhop would say, that’s “doing well by doing good.”

Expand Your Impact

Impact Loans don’t need to stay within the four walls of your credit union’s branches. With time, they can spill out into other community nonprofits you already support with charitable dollars.

As Lussenhop mentioned, “When it comes to charitable giving, organizations tend to focus on providing direct programming grants. You’re usually not thinking about the impact that can be made by giving a hand-up to the employees of the nonprofits who are making the very mission you are supporting come to life. 

“Even further, nonprofits often don’t have the resources to provide the raises and extended benefits that for-profit organizations do, and their recruitment, retention and ultimately the mission suffers greatly as a result. Credit unions have the power to change this by extending Impact Loans to their community charitable partners.” 

CIF partner CBC FCU is extending its Impact Loan Fund to nearby Boys & Girls Clubs and Big Brothers Big Sisters. CBC FCU is using these loans to deepen their existing partnership and make a progressively wider difference to their community. 

And you can too. 

If you are interested in what an Impact Loan Fund can do for your community, set up a discovery call with Courtney Lussenhop. Mike Scheid, CIF’s Executive Director, will also be leading a session at the CU Leadership Convention in Vegas this July if you’d like to learn more there.

Don’t be afraid to take the leap. It just might elevate your culture to the next level.

As Lussenhop noted, “Credit unions are in a position to continue building trust and become places of empowerment. Don’t miss the opportunity to ask the right question.”

And if you’re interested in building CIF into your next strategic plan, On The Mark Strategies facilitators help you make a community-transforming roadmap for the future. Book a free consultation today.

Sean Galli
Marketing Coordinator
OTHER POSTS FROM
Sean Galli
Remember to Link Bank or Credit Union Vision to Action

Remember to Link Bank or Credit Union Vision to Action

Link your bank or credit union vision to real impact with this On The Mark Strategies article. Use onboarding and storytelling to create something memorable.