This year, positive sentiment is flowing from Washington, D.C., toward Main Street..A bundle of bills have passed the House Financial Services Committee as part of an initiative dubbed “Making Community Banking Great Again,” by committee Chair, Rep. French Hill. The measures offer easing of regulatory requirements and bank examinations for smaller asset-size institutions.Given the pro-community banking climate, it’s “promising” the measures will pass through final approval, but it still takes “plenty of grassroots efforts,” says Paul Merski, EVP for congressional relations for the Independent Community Bankers of America.Indeed, in a July 25, 2025 podcast from the American Bankers Association titled, “Breaking Down the Bank-Related Provisions in the Big Budget Bill,” Ed Elfmann, ABA senior vice president for agriculture and rural banking policy, reminds bankers, “We can move the needle if we’re all rowing the boat together.”Moreover, while there’s favorable momentum for some issues, plenty of other developments could negatively impact community banks. For one, rules are needed to ensure stablecoins and crypto can’t drain deposits from Main Street. And, the policy landscape is constantly changing, with proposals like a 10 percent cap on credit card rates voiced by President Trump in January, Merski explains. It all adds up to what he describes as a year of “offense and defense,” with bankers needed to push regulatory headwinds across the finish line, and to provide cohesive arguments against threats to community institutions.Although a “face-to-face” visit with lawmakers in Washington is probably most effective, there are plenty of other ways to voice support for community banking, adds Merski. “Certainly visits to your local congressman in your hometown, as well as letters and emails are helpful.”Fortunately, many bankers at both smaller and larger community institutions are skilled at policy advocacy. Here, they share their experiences and game plans for 2026:Speaking up is especially critical nowIn the course of his 40-year career with the $190 million Liberty Bank of Liberty, Ill., Mark Field, president and chair, has attended some 35 Capitol Hill “Summits” with the Community Bankers Association of Illinois. On many of those trips, advocacy positions stressed “that this is a crucial time for community banking,” he remembers..“But that statement is more true now than it ever was. Right now, there is a massive confluence of different factions, each one trying to disrupt and destroy community banking,” he warns.Top among the threats are “nonbanks trying to get novel charters to do ‘banking light,’ so that they can creep into banking through the back door.” For instance, Field points to digital asset firms seeking national trust charters, and commercial and tech companies looking to obtain industrial loan company charters — without being subject to bank supervision.If large commerce or tech firms or fintechs start occupying the banking space, “they will try to steal our communities’ capital away from community banks, and that will have a definite impact on our small businesses and farmers.” He’s also worried that if stablecoins aren’t strictly prohibited from paying rewards or interest they could also drain deposits from local institutions.Moreover, an old threat — the competitive advantage that tax-exempt credit unions hold — should remain at the top of the 2026 policy agenda, Field maintains. Small credit unions with membership open to a "common bond" of a small group, “those I don’t have a problem with,” says Field. But as credit unions grow large geographical branch networks, even by acquiring banks and taking them off of the tax rolls, it’s necessary for bankers to unite in opposition to that lopsided playing field, he says.Playing the long game, with current benefitsWhen Jon Schmaderer made his first trip to Washington, D.C., with a group from the Nebraska Independent Community Bankers in 2012, “I thought it was something I would just do once,” he remembers. “But when I got there, I realized that you need to be consistently advocating [for community bank policy]. Change doesn’t happen right away.”.Schmaderer, CEO and president of the $240 million Tri-County Bank, is the third generation at the helm of the family-owned Stuart, Neb., institution. His parents and grandparents were active in voicing policy positions, and some successes won in the 1970s and ’80s are enjoyed by community bankers today, Schmaderer notes. “ATM and card networks were developing then. Community banks are now a natural part of that space,” thanks to predecessors paving the way.It’s a long-game, but there are current rewards, too. Last year, in preparation for a D.C., visit to advocate for tax bill provisions, Schmaderer connected with local farmers and small businesses — all typical of Tri-County Bank’s customer base — to work on the common objective of keeping the estate tax threshold intact. Not only was the vital threshold preserved, but the bank enjoyed “a united front with the small business and ag community.”Schmaderer wants to ensure a healthy community banking climate for the next generation of the family who may continue to lead The Tri-County Bank — his son, niece and nephew. “Digital assets, their governance, and the role the community banking industry intends to serve in this space is the next challenge that will have major long-term effects. This is an extension of our historical challenge to ensure a level playing field with non-bank competition who seek the privilege of providing community banking services but without comparable regulation.”Showing up is what’s importantAfter some visits to legislators on Capitol Hill — especially if he hasn’t been able to speak to a member of the House or Senate directly, but only with staffers — it’s easy to feel “frustrated because you don’t know if you’re really making an impact,” says Dan Christianson, chair and CEO of the $214 million, Preston, Minn., F&M Community Bank..But it’s not practical to focus on the effect of just one visit, he acknowledges. “It’s absolutely a numbers game. The more [community bankers] they hear from, the bigger the impact we make.”One issue that didn’t really concern Christianson until the 115-year-old bank opened a third branch in 2015, expanding from its mostly rural marketplace into Rochester, Minn., is the tax-status and regulatory advantages credit unions enjoy. “We didn’t have any credit union competition before branching into Rochester,” Christianson shares. The rate advantage that credit unions can sometimes enjoy due to their favorable status is now a priority for Christianson, one he’ll continue to press with legislators in 2026 — and why he’s convinced there’s strength in numbers. “Credit unions have members as opposed to shareholders and they recruit members,” he explains. “There’s often more of them [lobbying Congress] than there are bankers.”Developments in the rapidly evolving digital currency and stablecoin space are also on Christianson’s 2026 agenda to raise the alert on, since he sees a big risk of disintermediation to community banks unless policy is carefully crafted.Devoting attention to advocacyWith 33 full-service offices spread across North Dakota, South Dakota and Minnesota, the $4.8 billion Dacotah Bank of Aberdeen, S.D., faces a bevy of state and federal issues that could significantly affect its operations or products and services.“Management saw a need to devote resources to advocacy,” says Kristina Schaefer, who was hired on last year to steer Dacotah through the legislative and regulatory thicket.At its core, advocacy is “giving people the facts and telling your story,” Schaefer relates..Legislators and regulators are a key audience for explaining how proposals would impact the bank. But educating staff on proposals, and recruiting their expertise to craft communications is also a big part of Schaefer’s role as SVP, associate general Counsel and director of government relations.For instance, the ACRE provision in the 2025 tax legislation, whereby bankers can exclude from their taxes 25 percent of interest earned from loans for agricultural and some other rural properties, was a long-sought banking victory. Now, Schaefer is working with Dacotah’s finance and credit teams to outline how farms in their marketplace are often “mixed-use,” with commercial structures on site, to prepare comments for IRS guidance on qualifying properties.An internal website containing details on state and federal proposals is in the works. In the meantime, Schaefer has also been keeping staff updated on various issues. For instance, she’s sent management stats on how much crypto and stablecoin could drain bank deposits in their markets, along with suggested emails for staff to send to lawmakers.Making a case, not a complaint“We have a saying here in Indiana, it’s ‘Hoosier Nice,’” says David Findlay, CEO and chair of the $7.0 billion Warsaw, Ind., Lake City Bank. The policy positions that the Indiana Bankers Association prepares is fashioned in that “nice” format, and Findlay says it’s the secret behind the welcome reception he finds from lawmakers at the Statehouse or in Washington..“I think that people tend to look at conversations with elected officials as an opportunity to complain. But that is simply not constructive,” says Findlay, who’s also the 2026 IBA chair. Instead, “simply talk about legislative or regulatory issues that could impact your bank and your customers.”Lawmakers welcome constructive discussions, Findlay adds. This year, he plans to make the case that lowering interchange fees on debit cards or capping credit card rates at 10 percent would squeeze credit availability — especially for consumers on the lower end of the economic ladder — “the people they want to help.” He’ll present numbers on how interchange or credit card income covers losses to show how lowering fees would force credit cuts to riskier consumers.
