Serving Latino Members: Doing Well By Doing Good

August 1, 2005

Serving Latino Members: Doing Well By Doing Good

By Bill Merrick

In 2000, the population of new Latino immigrants in Charlotte, N.C., grew 410%. In 2001, crimes against these new residents increased 500% because few had relationships with financial institutions and had no safe place to keep their money, reports Deb McLean, vice president of marketing for $132 million asset Charlotte Metro Credit Union.

She spoke at CUNA Mutual Group's 2005 Discovery Conference in Orlando.

After seeking help from local banks (they refused), the Charlotte Police Department asked Charlotte Metro for assistance. The credit union's answer: a new "Safe" account that doesn't require a Social Security number because it doesn't pay dividends that would be reported to the Internal Revenue Service. It also can be used for a share-secured loan, which builds peoples' credit ratings.

In lieu of traditional identification, Charlotte Metro accepts passports, Mexican voter registration cards, visas, and foreign drivers licenses--which is legal and acceptable under National Credit Union Administration (NCUA) regulations, McLean says.

Before reaching out to this community, the credit union examined several aspects affecting service:

  • Culture. If you're not sure whether to call this community Hispanic or Latino, just ask, McLean says. Most prefer to be called by their nationality (i.e., Colombian, Cuban, Puerto Rican, Mexican).
Key cultural considerations for Latinos: they're close-knit and family oriented; have a strong work ethic; enjoy music and holidays; and are tremendously loyal. "If you reach out and deliver to them, they won't jump ship for a lower rate," she says.
  • Assumptions. Don't assume all Spanish speakers are Mexican, and don't assume all Spanish-speaking people aren't proficient in English.
  • Regulatory issues. You may serve non-U.S. citizens unless your bylaws state otherwise, and you may open an account without a Social Security number if it doesn't earn interest or pay dividends.
Make it clear you don't accept fake or shared Social Security numbers. "Encourage [members without Social Security numbers] to get an individual tax identificationnumber [ITIN form W-7]," McLean advises.
  • Bilingual and bicultural. Recruit bilingual and bicultural staff, offer extended hours and avenues of delivery, and provide bilingual ATMs, audio response, and signage. "Represent the membership you serve," she says. "People want to see others who look like them."
  • Diversity training. The credit union hired a company to conduct cultural diversity training for front-line staff. It covered challenges new immigrants face, their needs, and staff's preconceived notions and prejudices. " This can get personal and uncomfortable," McLean relates. "Some of our staff had major issues with serving [new immigrants]. They just didn't understand. It comes down to treating everyone with respect."
Be prepared to address the issue of illegal immigration and train staff to handle it graciously, she adds. Charlotte Metro treats all members equally: If they don't have a credit history or acceptable identification, the credit union outlines how to meet these requirements.
  • Popular services. These include checking accounts with ATM or debit cards, wiring services, and loans. Safety tends to be more important than rates for new Latino immigrants, McLean says.
  • Marketing. Show your presence and commitment by participating in and sponsoring cultural festivals and meeting community leaders. Advertise in Latino media outlets.
Serving Latino members takes a long-term commitment, McLean says, but the results are worth it. On average, Charlotte Metro's Latino members use five core products (vs. 3.2 for traditional members) and have four times as much in savings.

The credit union hasn't repossessed any car loans made to Latinos and hasn't charged off any Safe accounts. "You can do this," she says. "The rewards are tremendous. My Latino employees get employment offers from banks all the time but they stay because they're making a difference here."