This article originally appeared on CUinsight.
Some of their best ideas come to them after hours, when the halls of the credit union are quiet and they’re free to think beyond the day-to-day business of serving members. That’s precisely when Dustin Fuller and Deke Alexander, executives for Living in Fulfillment Everyday (LiFE) Federal Credit Union in Denton, Texas, began to wonder aloud about a credit union mission trip.
No strangers to the life-changing impact of church-sponsored mission trips, Fuller, LiFE’s CEO, and Alexander, the cooperative’s chief lending officer, envisioned immediate potential. Not only would a trip like that impact countless lives in poverty stricken countries, it could also create a completely immersive and fulfilling experience for both staff and the credit union’s members.
“Credit unions have an outstanding opportunity to change the employee experience that goes far beyond the 9-to-5,” said Alexander. “As employers, we’re often focused on tangible employee benefits, like dental and vision care or sales incentives and PTO. Yet, creating a culture that allows employees to improve lives in villages thousands of miles away – that’s hugely beneficial. You then transform everything. Suddenly a run-of-the-mill transaction at the teller window brings about the realization that serving this member allows our credit union to serve someone else in the third world.”
The Plan Takes Shape
That night, before the after-hours brainstorm had concluded, the two solidified a plan to coordinate two mission trips in two years. The first will take place in the Dominican Republic this November; the second in Mexico during 2018.
For each mission trip, LiFE will partner with area churches experienced in the local cultures and versed in the specific needs of the people. Their focus will be on helping villages gain access to clean drinking water. They will also work to develop longer-term relationships with the villagers, many of whom Alexander says have access to Facebook, affording LiFE staff the opportunity to maintain those connections once back in the states.
Engaging LiFE Members in the Mission
Beyond employees, Fuller and Alexander, both of whom have participated in several mission trips to the Dominican Republic, are also intent on bringing the credit union’s members into the initiative. After working with Coopera to learn more about the credit union’s Hispanic membership, LiFE executives learned a significant portion of the member base has ties to the Mexican culture. Therefore, Fuller and Alexander believe, the second of the planned mission trips will be particularly important to the membership.
“Our first mission to the Dominican Republic will include credit union members who know the trip and the culture extremely well,” said Alexander. “They will serve as guides to help train our staff, some of whom will actually lead the second trip to Mexico.
“We’d love to open up the trips to even more members in the future because we see it as a way to bond employees and members over something other than financial matters,” continued Alexander. “This will create a more intimate understanding of what can really happen when we put our hands and feet to work together. There’s a multiplying effect.”
To raise funds for the mission trips, LiFE is coordinating a golf outing called the Impact Life Golf Tournament Oct. 14, 2017 in McKinney, Texas. With the money raised, the credit union and its partner churches will buy the water filters they need to install once in the villages.
The Multiplying Effect of Living Our Purpose
“When you think about it, these trips strike right at the heart of what we do,” said Alexander. “For us, LiFE is about ‘Living in Fulfillment Every Day.’ A big piece of that is helping our employees see the fruits of their labor. We want to show our staff what it really means to make an impact, and to be a blessing to others.
“Our hope is this will inspire other small credit unions to think big,” said Alexander. “We want everyone in the movement to see it’s possible to get outside the 9-to-5, outside the SEG group, even outside their local communities. Let’s go on an adventure together, make lives better and come back changed people.”
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Earlier this month, I had the privilege of joining eight other local leaders in sharing 10 ideas for the Des Moines Business Record’s “90 Ideas in 90 Minutes” event. The experience was truly inspiring and educational.
From Des Moines Police Chief Dana Wingert’s reminder to applaud others and not take our employees for granted to Des Moines University President Angela Franklin’s advice to embrace change and maintain open minds, the ideas shared will strengthen organizations of all sizes and in every industry.
Below are a couple ideas I shared during the event that are near and dear to my heart. (To watch the entire presentation, check out the recording on YouTube.)
Encourage Personal Development Plans
At Coopera, we have found that one successful business practice to help avoid this situation is to ensure all employees have personal development plans. These plans are not complicated. We have a simple template with three sections:
● Objectives employees want to accomplish
As leaders, in addition to having our own personal development plans, our roles are to make sure employees are accountable to their plans, help them find the resources they need to accomplish their objectives and coach along the way to help them renew their goals. Resources can include anything from internal and online trainings to live events and mentorship opportunities.
As the world becomes more multicultural, and the more untapped and underserved markets emerge, it’s essential to be more representative of the constituents we serve. No matter how small or large an organization, there are simple ways to champion inclusion every day:
● Ask questions. Challenge the status quo.
For more ideas and inspiration, check out the 2017 90 Ideas in 90 Minutes e-book and videos.Leave a comment
By making a few key adjustments to your traditional lending products, you can make inroads with an entire segment of Hispanic borrowers looking for your services.
It’s no surprise that the Hispanic segment of the U.S. population is growing, increasing from 17 percent of the population in 2015 to an expected 29 percent in 2020 (according to U.S. Census figures). With that increase comes a growing demand for culturally-appropriate lending services, which is an exciting opportunity for credit unions looking to grow Hispanic memberships.
Access to credit is a key stepping stone for many Hispanic families, opening the door to greater financial and economic stability. Small-dollar loans also are a necessity for many Hispanic individuals, particularly those looking for financial help in completing the immigration and naturalization process. Without assistance, the application and processing fees associated with filing for U.S. permanent residency or U.S. citizenship can be out of reach for many immigrants.
By keeping a few key factors in mind when designing lending products, credit unions can expand the reach of their offerings to connect with Hispanic members and create lasting relationships.
By adjusting a few elements of your traditional lending process and products, you can better connect with Hispanic borrowers and create mutually beneficial and long-term relationships that drive growth. If you’d like more information on how Coopera’s staff can help you do that, please let us know.Leave a comment
In just a few years, more than half of college students will be part of a minority race or ethnic group. That means they’ll need financial services from credit unions that understand their unique backgrounds and needs.
It’s graduation season all across the country. Thousands of students are donning caps and gowns, and thinking about what’s coming next in their educational and career plans. And the changing demographics of America’s population means more of those students are coming from Hispanic families.
By 2020, the U.S. Census Bureau estimates more than half of the nation’s children will be part of a minority race or ethnic group. That means an increasing number of students heading to colleges and universities in the coming decade will be from Hispanic communities. What’s more, the graduation rates for Hispanic students are on the rise, and many minority students are opting to continue their education at community colleges close to their homes.
This growing number of Hispanic students represents a tremendous opportunity for credit unions that want to help them reach their educational goals and successfully manage their finances long after graduation day.
How are you preparing your credit union for the increasing numbers of Hispanic college students in your communities? Here are a few suggestions on products, as well as cultural readiness to serve this influential segment of young people:
Student loans with affordable rates and repayment plans can help many Hispanic students bridge the gap between the funds they and their families can provide and what colleges require.
Students balancing the demands of family, work and school can benefit from money management tools like online and mobile banking, checking accounts tailored to their needs and low-interest credit cards.
And for Hispanic students, partnering with a credit union with particular expertise in the cultural nuances of the community (like those who’ve earned the Juntos Avanzamos designation) can be incredibly valuable. The designation means the student will get the financial tools and education they need from credit unions that understand how to deliver products and services in ways that truly connect with Hispanic students and their families. For example Hispanic students will most likely be bilingual and able to connect with CU staff in either Spanish or English; their families, however, may need Spanish-speaking staff to help them understand their financial planning options and make the best use of a CU’s products and services.
By connecting with Hispanic students and helping them reach their educational and career goals, credit unions can strengthen their ties with their communities and create long-lasting relationships with those students as their financial needs grow and change. And it certainly doesn’t take an advanced degree to know that’s a combination that benefits everyone.Leave a comment
We’re fresh off another exhilarating CUNA Governmental Affairs Conference. It was a terrific conference with what I believe was record attendance! While in the nation’s capital for the event, we were lucky enough to chat with several credit union leaders about the value and importance of serving the Hispanic financial consumer.
As part of our whirlwind awareness tour, I got the chance to talk with CU Broadcast host Mike Lawson. We discussed quite a few things, including growth of the Hispanic population in places people may not expect. Credit unions in the Midwest, for example, are finding an explosion of the multi-faceted Hispanic communities in their areas to be a clear call to action.
Take a listen to the conversation at CUBroadcast.com and download our white paper, “Hispanic Growth Strategies Not Just for ‘Gateway States’ Anymore.” Then, get in touch. I’d love to hear your impressions, as well as where your credit union is on its own path to better serving this influential and growing group of community members.
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If nothing else, the tumultuous 2016 election year revealed the extent to which American working families are struggling. More than 40 percent of American jobs today pay less than $15 an hour, and most of these low-wage jobs lack important benefits such as paid leave, health insurance or retirement. Low-income wage earners are no longer a small demographic relegated to select neighborhoods and geographies – they constitute a significant demographic block.
America is a country of immigrants. In the US, there are currently 46 million immigrants, representing 13% of the US population, or 1 out of 8 residents. Far from representing an economic burden, immigrants contribute greatly to our local economies by paying taxes, establishing small businesses, and creating jobs.
Numerous economists argue for the long-term economic need for robust immigration. Citing an aging native-born workforce, contributions to the tax base and job creation from immigrant entrepreneurs and businesses, progressive immigration policy is actually an important way to grow the economy. Immigrant workers make a significant contribution to government revenue. Undocumented immigrants collectively pay an estimated $11.64 billion dollars each year in state and local taxes. In Iowa alone, undocumented immigrants contributed $37.4 million in state and local taxes each year, according to the Institute of Taxation and Economic Policy.
Immigrants start small businesses and create jobs. Though they made up over 13 percent of the total U.S. population in 2014, immigrants represented almost 21 percent of our country’s entrepreneurs. In fact, according to the Kauffman Foundation, immigrants were almost twice as likely as the native-born population to start new businesses in 2015. These businesses created millions of jobs. In 2016, 40 percent of Fortune 500 firms had at least one immigrant founder or a founder who was the child of immigrants.
Serving immigrants is part of the history of the credit union movement, and a key opportunity for credit union growth. Immigrant members of community development credit unions (CDCUs) report strong loyalty to their credit unions, in many cases indicating the credit union as the only place they choose to do their banking. According to a joint CUNA-Coopera study, credit unions that have strategically invested in outreach to the Hispanic community, for instance, report faster loan growth and accelerated membership.
For this reason, the National Federation of Community Development Credit Unions (the Federation), Coopera and the Network of Latino Credit Unions and Professionals (NLCUP) are working together with key industry partners to grow and expand the Juntos Avanzamos Initiative. Juntos Avanzamos – Together We Advance – is a designation for credit unions committed to serving and empowering both U.S. born and immigrant Hispanic consumers. Immigrants are a large and vibrant part of our communities and a key audience in the low- and moderate-income communities that Community Development Credit Unions (CDCUs) serve.
Today there are 65 Juntos Avanzamos designated credit unions around the country meeting the tremendous demand in the immigrant market for safe and responsible loans and financial services. These institutions have demonstrated that serving immigrants is both a sustainable business strategy and vital to fulfilling our collective goal of helping people of modest means achieve financial independence. Designations are made based upon an application with a rigorous scoring system that grades credit union performance that considers membership served, products and services targeting Latino immigrants, bilingual and bi-cultural operations and staffing, bi-cultural leadership on the board and management team, and bilingual marketing, messaging and signage.
The Federation is now working with network partners to become centers of information (“Know Your Rights”) and referrals for free legal and social service providers. Juntos Avanzamos is transforming credit unions from institutions that serve a community into community centers able to organize, communicate and support immigrant wage-earners, families, young people and seniors.
At this time, it is critical that immigrants know their credit unions are here for them. Once a member, always a member!
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Financial inclusivity as a growth strategy is quickly gaining traction in the community banking space. In fact, the trend recently garnered the attention of the hugely popular, national financial advice site Nerd Wallet.
Writer Juan Castillo reported:
Hispanics in the U.S. have long been known as “the sleeping giant” for their potential as a substantial and still-growing voting bloc. Now, some in the financial services industry are getting serious about targeting Hispanics — and Hispanic millennials in particular — as a prime source for market growth.
As the concept of reaching out to fast-growing markets like the Hispanic segment earns wider interest, it will be important for financial institutions to adhere to the fundamentals before going “all-in.” This will prevent staff from viewing the strategy as a fad and help them to see it as a part of the financial institution’s long-term plan.
There are essential first steps that must be taken on the front-end of any financial inclusion strategy, particularly when the credit union or community bank is targeting a segment of people new to mainstream banking.
Step One: Build the Right Organizational Mentality
Financial institution leaders must communicate the philosophical and business imperatives of serving a new market to build buy-in at all levels of the organization from frontline staff and management to board members and C-suite executives.
Step Two: Adapt to the Market
Do not expect the people you want to serve to adapt to you. Develop a comprehensive plan for how you will improve processes and products, as well as train employees and prepare your branches.
Step Three: Create a Strategic Plan
Define your opportunities and challenges with an eye to your specific local communities. What does the market look like in your city? Are there nuances across age, geography, acculturation factors? Create a roadmap encompassing groundwork, personnel training, product adaptation/development, processes and marketing. Set ongoing measurements and continue to nurture that all-important staff buy-in with frequent updates on milestones and wins.Leave a comment
More credit union people than ever before are talking about Juntos Avanzamos, the national designation awarded to U.S. credit unions making a strategic effort to serve the Hispanic community. The designation was initially developed by the Cornerstone Credit Union League in the states of Texas, Arkansas and Oklahoma and has now been rolled out nationally by the National Federation of Community Development Credit Unions (Federation).
A big reason for all the chatter is the program’s explosive growth. Just 15 months after the program went national, 32 more credit unions in 15 states have earned the designation. By the end of 2017, the program is expected to reach 100 credit unions in 20 states.
Coopera, along with many national league partners and the Federation, recently celebrated this growth at the Consulate General of Mexico in Dallas, Texas. It was a spirited evening organized by the Federation and the Consulate during which passionate credit union folks all came together to recognize the connections being built between credit unions and the youngest and fastest-growing consumer segment in the U.S.
The event was part of CUNA’s Community Credit Union Conference and the Federation’s Annual Conference, at which I was also honored to sit on a panel with Francisco de la Torre Galindo, General Consul, Mexico General Consulate. Before an audience of credit unions from across the country (many of which were CDFI certified or low-income designated), we talked about the growing network of Juntos Avanzamos credit unions. Among the specifics we discussed were…
How credit unions can partner with the Mexican Consulate to further provide accessible financial services to Mexican nationals.
The various resources offered by the Mexican Consulate to Mexican nationals.
The demographics of the market and how Hispanics continue to be one of the largest, fastest-growing, youngest and most financially untapped markets in the U.S.
Overcoming common concerns related to opening accounts for foreign nationals and offering loans to individuals with individual taxpayer identification numbers (ITINs).
How to develop a strategy to serve the Hispanic community for those that are looking to expand into this market. Success stories of Juntos Avanzamos-designated credit unions.
We are committed to keeping the Juntos Avanzamos ball rolling. We will continue the conversation at a special roundtable at CUNA’s GAC Conference on February 28, 2017 (more details soon). Please also remember the Network of Latino Credit Unions and Professionals (NLCUP) is hosting its annual network reception at the National Press Club from noon to 2:00 p.m. that same day. Juntos Avanzamos will have a big spotlight shone at it at our industry’s most important conference!
Visit the Federation’s website for more information about the Juntos Avanzamos designation.Leave a comment
Today, one in six consumers is Hispanic. By 2030, it’s anticipated that statistic will rise to one in three. This rapid growth is one of several potentially disruptive trends creating a need for businesses of all types to shift how they think about serving multicultural consumers.
As the buying power of the Hispanic market alone eclipses $1.2 trillion annually, marketers and other strategists are working diligently to attract this influential segment to their brands. Consider U.S. financial and insurance companies like Wells Fargo, JPMorgan Chase and Nationwide. In 2014, this business category spent a total of $352 million on Hispanic media. It’s clear these brands understand the value of the Hispanic market and are investing in smart segmentation strategies to make the most of its potential.
Beyond the Hispanic market, however, we see other cultures beginning to emerge as important to U.S. business. Many kinds of businesses are adopting a total market strategy in which multicultural segments are incorporated under a comprehensive consumer plan. Examples include Coca Cola and Western Union. Each has created diverse language communications, based on a genuine understanding of the cultural nuances within their vast and diverse marketplaces. Each of these brands works hard to position its products and services as vital to the happy lives of global consumers.
Marketers and other leaders recognize that emerging multicultural markets are best served by strategies that go far beyond merely translating communications. That’s because multicultural consumers are insightful; they are also not afraid to turn away from brands that don’t “get it.” They will easily ignore products and services they don’t believe genuinely embrace their essence.
For financial institutions in particular, payments products lend themselves well to a multicultural strategy. In fact, the topic was one I had the pleasure of discussing with financial institutions at this year’s TMG Executive Summit during the Future of Payments Panel session. Here’s a look at a few trending payment options and some insight about their prevalence among the Hispanic population specifically.
The perception that “debit cards are dead” couldn’t be further from true among Hispanics. They are a prime target market for debit products.
From 1992 to 2012, debit cards were the first overall choice among consumers. And while that’s changed for non-Hispanics, a Nielsen’s Share of Wallet study found Hispanics do differ from the national average somewhat when it comes to actual usage of their financial instruments. Forty-four percent use debit cards most often, while another 34 percent prefer cash or check. Only 19 percent use credit cards most often, compared to 35 percent nationally. The preference for debit and prepaid cards applies whether Hispanics are banked, unbanked, native or foreign-born, millennials or Generation Xers, consumers or business owners.
PayPal & Mobile Wallets
Just how tech savvy are Hispanics? Consider the following: According to the TD Bank Checking Experience Index, Google Wallet, Pop Money, Venmo, PayPal, SquareCash and other services are important among Latinos. Nearly half of Latino respondents surveyed by the index indicated they used PayPal within the last three months to send money to peers, citing ease of use and convenience. These consumers also made 22 percent of all mobile payments in 2014 (16 percent of the U.S. consumer base today).
What’s more, at least 85 percent of Hispanics in the U.S. have mobile phones compared to 88 percent of non-Hispanic whites. However, 82 percent of Hispanic mobile phone users have a smartphone, compared to 68 percent of non-Hispanic whites. Hispanic mobile users with bank accounts show a higher rate of use of mobile-banking relative to mobile phone users with bank accounts overall. They make transactions, pay bills at least weekly and send money internationally with their smartphones.
According to the Federal Reserve, prepaid cards are the fastest growing form of non-cash payments. They are cost-effective, flexible and easy to use for consumers, governments and businesses. A lot of innovation exists from specialized providers more so than traditional financial institutions.
Importantly for multicultural payment strategies, federal regulators are working to ensure language barriers don’t prevent non-English speaking consumers from having a good experience. The more prepaid providers are incentivized to meet the needs of an ever-changing and multicultural market, the better prepaid cards will become as a viable alternative to debit and credit cards.
The variety of payment options available to today’s consumers creates a terrific opportunity for both financial institutions and consumers. Credit unions, in particular, should continue developing a deeper understanding of multicultural member needs and behaviors to effectively reach new consumers. Payments, with their increasing emphasis on mobility and innovation, are a natural place to start.Leave a comment
As the child of Mexican immigrants, I grew up in a household that was unique in many ways from those of my friends and peers. One of the differences was that my parents paid bills, saved money and accessed credit outside the traditional financial system. Hindsight being what it is, I can now see how much of an influence those financial choices had on my eventual career path.
Although it came with challenges, my non-traditional American childhood absolutely empowered me. Today, I feel so fortunate to be living out my passion – introducing more Hispanic consumers to the life-changing benefits of becoming a credit union member.
What’s equally exciting to me is introducing more organizations to benefits of serving Hispanic consumers. As I travel the country, talking with credit unions, colleges and other consumer-centric organizations, I’m learning so much about how perceptions continue to shape reality.
One of the perceptions that Coopera colleagues and I are working hard to reshape is this idea the Hispanic market is homogenous. In fact, there are many nuances to the culture. Let’s take a look at a few…
Acculturation, Language & Immigration Spectrums
Acculturation describes how quickly an individual or set of individuals adopts the behaviors, beliefs/values and attitudes of a new culture in addition to their native culture. The spectrum goes from un-acculturated through semi-acculturated to fully acculturated.
It’s critically important for marketers and others to understand where their target market resides on the spectrum. For instance, a credit union that believes it is best suited to serving semi- or fully acculturated Hispanics will want to know members of these two segments prefer TV and print media outlets, while radio is important for the un-acculturated. In terms of product development, credit cards are common among fully acculturated Hispanics, but that is far from true for un-acculturated individuals.
In addition to behaviors, values and attitudes, there’s also a spectrum of language preferences that vary from Spanish to bilingual to English. Immigration status, too, changes from recent arrival to established resident to U.S. born. All of these characteristics and preferences impact the way Hispanic consumers value (or don’t value) financial services to the quality of their lives.
Financial Attitudes and Behaviors
There is tremendous opportunity for credit unions to foster trust and expand the financial education of some Hispanic community segments. Saving for retirement, seeking financial advice, long-term goals, personal debt and financial confidence are areas that require special concentration across segments of the Hispanic market. Here again, however, there are differences between groups within the culture.
This is why it’s so important to view the results of national studies, surveys and indexes with a grain of salt. Take, for instance, an extensive study of more than 1,000 Hispanic individuals between 25 – 70 with incomes of $25K or higher.
Here are just a few of the findings from that particular national study:
–More than half indicated a poor or very poor understanding of workplace-based retirement plans.
–Half of respondents expressed a preference for Spanish communication and materials.
–Respondents with lower incomes and those born outside of the U.S. place higher priority on funding near-term goals such as education for their children.
When reviewing national studies, be mindful of the word “half.” Let it serve as a reminder of the great diversity that lies within the U.S. Hispanic community. If a particular study finds half of its respondents prefer Spanish, for instance, that could mean the other half did not.
The biggest take away: It’s critically important to understand your local market needs. Like much of the general population, Hispanic consumers strive to improve their financial situation. At the same time, acculturation, language, immigration status and other characteristics such as age, income and country of birth, have a huge influence on how that value is applied day-to-day.
While the Hispanic population continues to grow, it will continue to change. As you approach strategic planning season, consider whether your credit union could benefit from a local market study of the influential Hispanic consumers in the communities you serve.Leave a comment