The Defense Credit Union Council (DCUC) isn’t mincing words anymore. In a letter to the House Committee on Small Business ahead of their July 1st hearing—with the very patriotic title “250 Years of American Legacy: Small Businesses and the American Dream”—they made their case crystal clear: We’re making it unnecessarily difficult for veterans to start businesses, and there’s a straightforward fix sitting right there in Congress.
The solution? The Veterans Member Business Loan Act (H.R. 507/S. 110). Think of it as removing a bureaucratic speed bump that’s been tripping up veteran entrepreneurs for years.
Here’s the problem in plain English: Veterans face a perfect storm of challenges when trying to get business loans. They often don’t have lengthy private-sector credit histories because, you know, they were busy serving the country. Frequent relocations and deployments don’t exactly help build the kind of paper trail that traditional lenders love to see. So even when a veteran has a rock-solid business plan and proven leadership skills—the kind you only get from actual military service—they’re often stuck relying on personal savings, credit cards, or expensive financing options.
“That is not a lack of ambition; it is a policy failure that prevents capable veterans from fully participating in the American Dream,” DCUC wrote. Ouch. But also, fair.
The Credit Union Catch-22
Credit unions are actually well-positioned to help here. Unlike big banks that rely purely on algorithms and credit scores, credit unions can do relationship-based lending—they can look at the whole person, not just the numbers on a screen. But there’s a catch (isn’t there always?): the federal Member Business Lending cap.
This cap means that credit unions literally have to turn away qualified veteran borrowers not because they’re risky, not because the credit union can’t afford it, and not because the veteran doesn’t meet underwriting standards—but simply because they’ve hit an arbitrary ceiling set by decades-old rules that don’t reflect how business works today.
“No veteran with a sound business plan should be told, ‘We have hit our limit,’ because of a decades-old rule that does not reflect today’s economy,” says Jason Stverak, DCUC Chief Advocacy Officer.
The Veterans Member Business Loan Act would exclude loans made to veterans from that cap. Simple as that. Credit unions would still need to make prudent loans and follow all the normal underwriting standards and regulatory oversight—this isn’t about throwing caution to the wind. It’s about removing an outdated barrier that serves no real purpose in 2025.
Anthony Hernandez, DCUC President/CEO and retired U.S. Air Force Colonel, summed it up: “America’s veterans deserve a fair opportunity to pursue their entrepreneurial goals and access the capital needed to succeed. Passing the Veterans Member Business Loan Act would remove an outdated barrier, expand responsible access to small-business financing, and empower more veterans to build businesses, create jobs, and continue serving their communities.”
Credit Unions Want Their Seat at the Table Back
In a separate letter to the House Appropriations Subcommittee ahead of their June 30th oversight hearing with OMB Director Russell Vought, DCUC made three straightforward requests—the kind that shouldn’t be controversial but somehow are:
- Bring back a formal credit union advisory voice at the Consumer Financial Protection Bureau (CFPB). They used to have a Credit Union Advisory Council. Now they don’t. That seems like a problem when you’re making policies that affect credit unions.
- Keep consumer protection focused on actual bad actors instead of piling unnecessary regulations on member-owned credit unions that are already supervised by NCUA.
- Protect funding for the CDFI Fund and NCUA Community Development Revolving Loan Fund so underserved communities (including military families) can actually access affordable financial services.
“Credit unions need a meaningful seat at the table when policies affecting their members are being developed,” Stverak noted. It’s a reasonable ask—have the people who actually work in the industry advise on industry policy. Revolutionary, right?
To help move things along, DCUC even provided suggested questions for the Subcommittee to ask Director Vought, including whether OMB will support re-establishing the CFPB’s Credit Union Advisory Council and commit to timely distribution of community development resources that Congress has already appropriated.
Keep the Defense Bill About, You Know, Defense
DCUC also sent a letter to House leadership regarding the FY2027 National Defense Authorization Act (H.R. 8800), and their message was refreshingly straightforward: Can we please keep the defense bill focused on defense?
The concern is that unrelated financial services provisions—things like interchange and payment-routing mandates, the Credit Card Competition Act, or proposals to extend federal credit union share insurance to non-members—might get tacked onto the NDAA at the last minute. It’s the legislative equivalent of hiding vegetables in a brownie, except in this case, the vegetables might actually harm military financial readiness.
“Our request is focused: please keep the NDAA centered on national defense and military readiness, reject last-minute unrelated financial-services riders, and include targeted bipartisan provisions that strengthen military financial readiness if there is an opportunity to do so,” wrote Stverak.
One particular concern: proposals to blur the membership nexus that’s central to the credit union model. Federal credit unions are member-owned cooperatives. The share insurance exists to protect those members and is funded by credit unions themselves. Expanding that insurance to non-members through last-minute NDAA language would create safety and soundness concerns and strain the entire framework.
“If Congress wishes to consider deposit or share insurance reform, it should do so through regular order with the House Financial Services Committee, NCUA, affected institutions, and member-owners fully engaged,” DCUC explained. In other words: if you want to make big changes, have the actual debate in the appropriate committee, not by sneaking it into must-pass legislation.
What Should Be in the NDAA
While pushing back on harmful add-ons, DCUC did call for including provisions that would actually strengthen military financial readiness:
- The bipartisan Veterans Member Business Loan Act (yes, that same one from earlier)
- Padilla-Cramer Central Liquidity Facility reforms (the CLF Enhancement Act)
- Greater loan maturity flexibility for federal credit unions
“Defense credit unions are financial readiness partners for the military community, providing trusted financial services before, during, and after military service,” says Hernandez. “The NDAA should strengthen, not distract from, our national defense mission. Congress should reject last-minute financial services riders that have no place in defense legislation while supporting practical, bipartisan measures that expand access to credit, strengthen financial resilience, and better serve military families.”
It all comes down to this: There are straightforward, bipartisan ways to help veterans access capital, ensure credit unions have a voice in policymaking, and strengthen financial services for military families. None of this requires radical reform or massive spending. It just requires Congress to act on common-sense measures that have broad support. The question is whether they will.