Hispanics are the largest, fastest-growing, and youngest ethnic group in the U.S.—but they’re also the most underserved by financial institutions.
More than 50 million Hispanics live in the U.S., and their average age is 27. About half are unbanked or underbanked. From 2000 to 2010, the U.S. Hispanic population grew 43%, and trends suggest one of three U.S. residents will be Hispanic by 2050.
“Hispanics are clearly credit unions’ largest growth opportunity,” says Miriam De Dios, CEO of Coopera, a CUNA strategic partner that helps credit unions connect with this audience.
Although credit unions have worked to remove barriers that prevent or discourage Hispanics from becoming members, lingering misconceptions might hamper your front-line staff’s ability to serve these members.
Coopera offers information in these areas to increase understanding and improve service:
• Immigration status. A 2012 poll by the National Hispanic Media Coalition indicates nearly one-third of Americans believe half of Hispanics are in the U.S. illegally. In reality, 76% of Hispanics living in the U.S. are U.S. citizens. And by 2020, second-generation Hispanics will outnumber their parents.
• Proper identification. The Customer Identification Program, outlined in Section 326 of the USA Patriot Act, specifically allows your credit union to use several forms of identification to serve these members.
These include a passport, matricula consular (the most popular form of Mexican personal identification issued to immigrants living in the U.S.), cedula (a national identity document used by many Central and South American countries), and an Individual Taxpayer Identification Number (ITIN).
Proper identification and verification of the matricula consular and other foreign identification cards are important training points. But ultimately, the process is no different than learning to recognize and verify driver’s licenses from other states.
• Products and services. Credit unions often believe Hispanics use only check cashing and money transfer services, Coopera says. But at credit unions working with Coopera, Hispanic members’ level of service usage and loan penetration are competitive with overall member averages.
• Document translation. Conducting business and having documents available in Spanish will put some members at ease and serve as an important way to connect with your members. But you don’t have to translate all of your documents at once; instead, translate them at your own pace.
• Service to family members. If you just focus on second-generation Hispanics, you’re missing the boat on a first generation that’s in the workforce and is more
likely to be unbanked or underserved. And you’re missing a chance to connect with parents whose children more likely will become members.
“The younger second generation is still learning its financial behaviors from the first generation, and still needs a connection to the culture,” De Dios says.