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Deposit Fee Waiver and CRA Credit

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  • #31933
    rcooper
    Keymaster

    Question from our recent webinar, Pandemic Relief – Managing Compliance Issues:
    If we waive fees for deposit accountholders, would this be considered a CRA action and get CRA credit also?

    #31934
    rcooper
    Keymaster

    Yes, fee waivers for deposit account holders could be considered for CRA credit. The “Joint Statement on CRA Consideration for Activities in Response to the COVID-19” issued on March 19 (and page 61-62 of the training manual), states,
    Pursuant to the Community Reinvestment Act (CRA), the agencies will favorably consider retail banking services and retail lending activities in a financial institution’s assessment areas that are responsive to the needs of low- and moderate-income individuals, small businesses, and small farms affected by COVID-19 and that are consistent with safe and sound banking practices. These activities may include, but are not limited to
    • Waiving certain fees, such as:
    o Automated teller machine (ATM) fees for customers and non-customers,
    o Overdraft fees,
    o Late payment fees on credit cards and other loans, and
    o Early withdrawal penalties on time deposits;
    • Easing restrictions on cashing out-of-state and non-customer checks;
    • Expanding the availability of other short-term, unsecured credit products for creditworthy borrowers;
    • Increasing credit card limits for creditworthy borrowers;
    • Providing alternative service options to customers in light of limited ability to access branches; and
    • Offering payment accommodations, such as allowing borrowers to defer or skip payments or extending the payment due date, which would avoid delinquencies and negative credit bureau reporting, caused by COVID-19-related issues.

    #33823
    jholzknecht
    Keymaster

    Some bankers have been denied credit in this situation. The credit is not automatic. Must document that the waiver is are responsive to the needs of low- and moderate-income individuals, small businesses, and small farms affected by COVID-19.

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