What is it about?
Credit Unions enjoy special tax exemption because they claim to serve people of modest means. We find that during the financial crisis they did not provide home equity line of credit to poor people or those living in neighborhoods suffering from declining house prices.
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Why is it important?
Credit Unions enjoy benefit of over $10 billion in tax exemption. If they are not really serving the people they were designed to serve it might be worthwhile to figure out ways to distribute tax subsidies in other ways.
Perspectives
I think that the paper adds to the current debate whether credit unions should continue to keep their tax exemption. Growing evidence shows that even though some small credit unions still continue to serve their customers in a community setting, the larger credit unions who enjoy the bulk of the tax exemption benefits have strayed far from their original purpose.
pankaj maskara
Nova Southeastern University
Read the Original
This page is a summary of: Credit unions during the crisis: did they provide liquidity?, Applied Economics Letters, February 2018, Taylor & Francis,
DOI: 10.1080/13504851.2018.1444259.
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