Now is a great time to reach out to the Hispanic community.
And credit unions can look to their peers for help in reaching the largest, fastest-growing, youngest, and most underserved market in the U.S., credit union experts say in a joint webinar by CUNA, Coopera, and the Federation of Community Development Credit Unions.
“You don’t have to reinvent the wheel,” says Pablo DeFilippi, the Federation’s vice president of membership and business development.
There are model products and services already employed by credit unions across the country, DeFilippi says. You can learn lessons from their implementation and outreach efforts and get more information from groups like the Federation and Coopera.
“We are all credit unions; we are in this together,” says George Poitou, senior vice president/chief operating officer for $625 million asset SCE Federal Credit Union in Irwindale, Calif.
During the webinar, Poitou and Everado Munoz, branch manager for $125 million asset Santa Cruz (Calif.) Community Credit Union, share best practices for targeting the Hispanic community. They include:
• Design products and services specific to the Hispanic market, such as wire transfers, small loans, payday lending alternatives, and nontraditional mortgages.
• Use Matricula Consular, an identification card issued by the Mexican government through its consulate offices to nationals residing outside of Mexico, as an acceptable form of identification.
• Adopt flexible underwriting policies to use a quantitative and qualitative approach to credit, and acknowledge that FICO scores do not tell the whole story of a member’s financial situation.
• Realize that branches are king and can be used effectively to welcome the Hispanic community through designed use of color, Spanish word displays, and Hispanic architectural styles.
• Have staff and board members who look like the membership or potential membership to more easily build trust.
• Support and participate at community events.
• Get assistance from outside organizations such as the Federation and Coopera, which work with credit unions to design products and reach out to the Hispanic community.
• Partner with local organizations that have a history of working with your target Hispanic audience, especially on immigration issues.
• Develop a sister 501(c)(3) organization to do additional public good with financial education, tax assistance, and developmental products to transition the underbanked and unbanked into the financial mainstream. The nonprofit status is beneficial for obtaining grants and supplemental capital.
Commitment to serving the Hispanic population is key, Poitou says, regardless of the specific strategies that credit unions use.
“You can’t just dip your toe in; you have to go all the way in,” Poitou says. “You can’t just pretend or do a little bit, you have to go after it.”
You can never do too much outreach, says Munoz. It pays off over time. And don’t be too afraid of financial exposure. “There is risk, but it is minimal,” he says.
Serving Hispanics--many of whom are unbanked or underbanked and need financial assistance—is part of the credit union philosophy to help this audience—but it’s also good for business, these credit union leaders say.
That’s especially true in the wake of President Obama’s recent executive actions on immigration. Credit unions may have many new members seek services that bring them into the financial mainstream.
“Credit unions have a massive opportunity to connect to a community that needs them,” says DeFilippi. “It affects every state and every major city in the country.”
The webinar is the second of a two-part series titled “Immigration Executive Order and Financial Inclusion.” You can find a recording of each part on CUNA’s website.