By Kenneth E Leonard, MBA
CEO & Co-Founder
Element 22 Commercial Group
How the Multi-Investor CUSO Model Is Democratizing Commercial Lending for Credit Unions of Every Size
Let me tell you about a phone call I love getting.
It goes something like this: “Kenny, we’ve got members who are small business owners. They’re the backbone of our community—they create jobs, reinvest locally, and they’ve banked with us for years. We want to support them with commercial lending, but we don’t have the internal resources or the staff to do it on our own. What can we do?”
That’s my favorite kind of call—because the answer used to be “not much.” And now it’s “let’s get to work.”
That’s exactly what happened with one of our partner credit unions. Like many credit unions, they saw a moment of opportunity: larger banks were pulling back from small business lending, and their members—local entrepreneurs, family-owned shops, small manufacturers—needed a lender who understood their community. The Credit Union didn’t have a full commercial lending team in-house, but they had something just as powerful: a willingness to partner. They teamed up with Element 22 Commercial Group to expand their commercial lending capabilities without compromising control, compliance, or member service. The loan need was larger than what the credit union could handle, so Element 22 facilitated a participation with another credit union to get the loan done for the member borrower. The result? Small businesses in their communities got access to the capital they needed, and the Credit Union proved that you don’t have to be a billion-dollar institution to deliver big results for your members.
That story isn’t unique. It’s playing out across the country. The thing that changed wasn’t a new regulation or a technology breakthrough—it was a shift in mindset. Credit unions are realizing they don’t have to build everything themselves to deliver everything their members need. The multi-investor CUSO model has turned “too small to compete” into “just right to collaborate.” And honestly, it’s one of the most exciting things happening in our industry right now.
Right Place, Right Time, Right Model
Here’s what makes this moment so interesting. Commercial lending across credit unions grew more than 35% between the third quarters of 2024 and 2025, according to Callahan & Associates. That’s not a typo—thirty-five percent. Meanwhile, banks are quietly stepping back from commercial real estate and small business lending. Regulatory pressure, post-COVID jitters about office vacancies, tighter CRE concentration limits—whatever the reason, banks are leaving a gap. And in communities across America, someone needs to fill it.
Enter credit unions. We were literally built for this. We know our communities. We know our members’ businesses because we see them at the grocery store, at the school board meeting, at the local chamber lunch. That relational advantage is real and it’s powerful.
But let’s be honest about the challenge, too. The NCUA has rightly pointed out that commercial lending isn’t appropriate for every credit union to do on its own. The expertise required—specialized underwriting, NCUA Part 723 compliance, construction loan administration, portfolio risk management—is significant. For credit unions under $500 million in assets, hiring a full commercial lending team is like buying a fishing boat to catch one fish.
So how do we square the circle? How do smaller credit unions seize this generational opportunity without overextending?
Two words: shared infrastructure.
Ten Credit Unions Walk Into a CUSO…
I know, it sounds like the start of a joke. But stick with me, because what happens next is actually pretty remarkable.
When multiple credit unions invest in a single commercial lending CUSO, they’re not just splitting costs—though the economics are certainly attractive. They’re building something together that none of them could build alone: a deep bench of experienced commercial lenders, a battle-tested compliance infrastructure, a diversified loan portfolio, and a shared platform for managing risk. Each credit union brings its members and its capital. The CUSO brings the expertise and the engine.
Think of it like a golf scramble team. (Yes, I’m a golfer—bear with me.) No single person on your team can carry every hole. But when you put the right combination of players together, you cover each other’s weaknesses, and you compete at a level none of you could reach solo. That’s the multi-investor CUSO. Credit unions bring their best to each hole and win together.
At Element 22 Commercial Group, we’ve lived this story. We transitioned to a CUSO structure in 2018 with ten credit union investors. We now have over 100 credit unions in 24 states. Our portfolio has grown from $23 million to over $143 million, and in 2025 we did about $200 million in underwriting, loan documentation, participations, and more. But the number I’m most proud of isn’t the dollar figure—it’s the number of communities where a small business owner got to say “yes” because their credit union had the backing to say “yes” first.
This model also solves one of our industry’s trickiest problems: talent. Great commercial lenders don’t grow on trees, and they’re expensive. A $200 million credit union can’t justify a full-time commercial lending team for a handful of deals a year. But a CUSO serving over 100 credit unions? Now you’ve got the deal flow to attract top talent, and that talent brings experience across multiple industries, geographies, and deal structures. Everybody levels up.
Your Member. Your Relationship. Full Stop.
I want to tackle a concern I hear all the time: “If we partner with a CUSO, are we giving up the member relationship?”
Short answer: absolutely not. Just ask the Credit Union in the example I used in my opening. Their members’ experience is seamless. The loan originates through their credit union. Their trusted relationship manager is still their point of contact. The CUSO provides the underwriting muscle, the compliance framework, and the portfolio management behind the scenes. The member doesn’t see the plumbing—they just know their credit union came through for them.
And that matters enormously in 2026. Small businesses don’t want to be just an account number at a regional bank. They want a lender who knows their name, their business, and their town. Credit unions were made for this. The CUSO model just gives them the horsepower to deliver.
Three Reasons I’m Optimistic About What’s Next
AI is becoming the great equalizer. Nearly two-thirds of credit unions now plan to leverage AI for credit decisioning. When AI-powered underwriting and real-time portfolio monitoring tools sit inside a CUSO serving multiple institutions, the cost per credit union drops while the sophistication skyrockets. Smaller credit unions get access to the same analytical firepower that the big banks spend millions to build. That’s not the future—that’s next Tuesday.
The regulatory environment is maturing in our favor. NCUA’s guidance increasingly recognizes that CUSOs help credit unions access expertise they couldn’t build independently. As commercial lending within the credit union space continues to mature, I expect the regulatory framework will evolve to further enable—not restrict—responsible, CUSO-driven growth. The conversation is shifting from “should credit unions do commercial lending?” to “how can we help them do it well?” That’s a much better question.
The next generation of leaders gets it. The emerging leaders in our industry grew up in a world of shared platforms, collaborative ecosystems, and open APIs. They don’t see partnership as a concession—they see it as a strategy. This generation will accelerate the CUSO model not because they have to, but because they intuitively understand the leverage it creates. And frankly, they’re going to do things with this model that people like me haven’t even imagined yet.
The Invitation
I want to be clear about something: this isn’t a sales pitch for Element 22. This is a love letter to the model itself—because I believe the multi-investor CUSO is the single most powerful tool credit unions have to compete, grow, and stay true to their mission at the same time.
The Credit Union in the opening example didn’t wait until they had a fully staffed commercial lending department. They found the right partner, kept their members at the center, and proved something important to their board, their staff, and their community: being small doesn’t mean being limited. It means being nimble enough to find the right partners and brave enough to say yes.
In the credit union movement, we love the phrase “people helping people.” The multi-investor CUSO is simply the next chapter of that story: credit unions helping credit unions, so they can better serve the people who trust them most.
The window is open. The model works. And if you’re a credit union leader reading this and thinking, “That sounds like us”—good. It was written for you.
Let’s get to work.
Sources
1. Callahan & Associates. Commercial lending across the credit union industry grew more than 35% between Q3 2024 and Q3 2025. As cited in CreditUnions.com, “The 2026 Credit Union Balance Sheet Preview,” January 5, 2026.
2. S&P Global Market Intelligence. “Credit Unions’ Commercial Lending Foray Riddled with Risks, Rewards,” October 20, 2025.
3. America’s Credit Unions. Economic Update on AI’s Impact on the Economy: approximately two-thirds of credit unions plan to leverage AI for credit decisioning. As cited in EasCorp, “Trust, Tech, and Member Value: Credit Union Trends for 2026,” December 17, 2025.
4. Leonard, K. & North Central Area Credit Union. “Expanding Small Business Lending Through Strategic Partnership,” LinkedIn / Element 22 Commercial Group, January 20, 2026.
5. CUInsight. “Element 22 Commercial Group Announces Strategic Partnership,” October 4, 2024.
6. TruStage / CUNA Mutual Group. Credit Union Trends Report, 2025–2026.7. West Monroe. 2026 Financial Services Industry Outlook.
To learn more or connect with Element 22 Commercial Group, please visit their website at https://www.element22cg.com/.
About the Author:
Kenneth E Leonard, MBA
CEO & Co-Founder
Element 22 Commercial Group
Kenneth E. Leonard, MBA is the CEO & Co-Founder of Element 22 Commercial Group, a Credit Union Service Organization (CUSO) providing member business lending and commercial loan services to credit unions across Michigan and nationally. With over 20 years of commercial banking experience, Kenny founded Element 22 in 2017 and led its transition to a multi-investor CUSO in 2018. He is a former Greater Southwest Chapter Chair for the Michigan Credit Union League, former Board Alternate on the Michigan Credit Union League Board and is Board President of Kalamazoo Valley Habitat for Humanity. Kenny can be reached at kleonard@element22cg.com.