Purpose of the Bill

The bill aims to support economic development by providing financial resources to help create a credit union specifically for underserved communities. It seeks to provide better access to financial services for low-income individuals who have limited or no access to traditional banking.

Main Provisions

• Appropriation of Funds: The bill allocates $500,000 annually for two years (fiscal year 2026 and fiscal year 2027) from the general fund. These funds are dedicated to a nonprofit organization tasked with establishing either a federally or state-chartered credit union.
• Credit Union Objectives: The credit union is required to:
  1. Serve low-income individuals who lack access to conventional banking services.
  2. Offer deposit, investment, and loan services that are tailored to the cultural and financial needs of the community.
  3. Maintain at least one physical location to ensure members have in-person access to financial services.

Significant Changes to Existing Law

The bill introduces a one-time allocation of funds specifically aimed at creating a credit union designed to meet the needs of underserved populations. This initiative highlights a targeted approach to expanding financial inclusivity and addresses gaps in banking services for certain communities.

Reporting Requirement

• By February 15, 2028, the commissioner responsible for employment and economic development must report on the grant activities and outcomes. This report will be submitted to the relevant committees within the Minnesota House of Representatives and Senate.

Relevant Terms

credit union, underserved communities, low-income individuals, nonprofit organization, traditional banking services, financial inclusivity, economic development, Minnesota Statutes chapter 52, appropriation, deposit services, loan services, grant activities, fiscal year.