While the partial government shutdown appears to be over, many individuals and families have faced financial hardships due to missing paychecks and lost wages.
Fortunately for many furloughed federal workers and others affected by the 35-day impasse, locally based community banks offered a variety of unique services to help their customers effectively manage their finances throughout the shutdown.
{mosads}As policymakers negotiate a long-term funding deal ahead of their Feb. 15 deadline, they should remember these proactive community bank efforts as they advance financial services policies during the 116th Congress.
As relationship-based bankers fully vested in the success of their local communities, community banks know their customers personally and stand with them in good times and bad.
Community bankers worked hand-in-hand with customers in the aftermath of the 2008 financial crisis and have led recovery efforts following countless floods, tornadoes, earthquakes and other natural disasters from coast to coast.
So while larger, transaction-based financial firms might know their customers only as account numbers, community banks were well-equipped to help customers and families affected by the longest government shutdown in U.S. history.
In the nation’s capital region — home to many of the 800,000 federal workers and more than 1 million federal contractors who missed paychecks because of the shutdown — community banks acted quickly.
The National Capital Bank of Washington, which is headquartered down the street from the U.S. Capitol on Pennsylvania Ave., offered discounted lines of credit, waived processing fees and allowed furloughed workers to miss mortgage payments to help them weather the financial storm.
Burke & Herbert Bank in Alexandria, Va. offered mortgage customers payment relief, while Fairfax, Va.-based MainStreet Bank extended auto loans without fees and reached out to each of its government contractor customers with an offer to work with them on a case-by-case basis.
A few hours south in military-heavy Hampton Roads, TowneBank in Suffolk, Va. led a social media campaign to encourage affected workers to personally contact the bank for guidance and assistance. Old Point National Bank in nearby Hampton, Va. allowed affected customers, including U.S. Coast Guard personnel, to skip payments or make smaller, interest-only expenditures on their loans without a fee.
Elsewhere in Virginia, Bank of Marion offered relief for government workers regardless of whether they were existing customers, while First Bank in Strasburg provided 90-day payment holidays, 24-month, low-cost loans and overdraft fee waivers for federal government and contractor employees.
Of course, affected workers and families extend well beyond the mid-Atlantic, and so do community banks. United Roosevelt Savings Bank (URSB) in Carteret, N.J. offered interest-rate relief for loan customers while waiving minimum balance requirements on checking and savings accounts and early-withdrawal fees on certificates of deposit.
Vista Bank in Lubbock, Texas offered immediate access to zero-interest, zero-payment, zero-fee loans through its People First Loan Program. And Plumas Bank in Quincy, Calif., allowed depositors to overdraw direct deposit accounts by up to 80 percent of their monthly paycheck for up to three months.
These are just a few examples of the kind of assistance that local community banks specialize in to support their Main Street consumers and small businesses when they need it most.
With more than 52,000 locations nationwide, and as the only physical banking presence for one out of every five U.S. counties, community banks are uniquely poised to help their communities during times of financial distress.
Policymakers should remember these stories as they develop new laws affecting local community banks, recognizing that financial services policies should encourage — not inhibit — the personalized service and symbiotic relationships that are the hallmarks of this unique and highly impactful industry.
Rebeca Romero Rainey is the president and CEO of the Independent Community Bankers of America.