The following case study is an excerpt from Coopera’s Iowa Hispanic Opportunity Report for the Iowa Credit Union League (ICUL). For more information, contact the ICUL at www.iowacreditunions.com.
Veridian Credit Union, headquartered in Waterloo, Ia., has a long history of offering innovative and affordable financial services to members. One way Veridian differentiates its business from other financial service providers in the area is by offering services specifically designed to improve the socio-economic well-being of those in greatest need — including the local Hispanic community. For Veridian it’s not about the business’s bottom line; it’s about best serving members’ financial needs.
“Many years ago, Veridian recognized a need to offer Latinos in our communities more affordable products and services compared to the expensive alternatives they were using,” said Angela Weekley, Veridian community inclusion manager. “We also understood that our credit union’s value to members was to help them build a successful financial future, rather than offering one-off solutions.”
To aid their efforts, Veridian began working with Coopera to better understand the nuances of the Hispanic culture, to learn more about what this market needed out of a financial services provider and to build a relationship with the Hispanic communities in its operations areas. Coopera also gave Veridian guidance in hiring bilingual staff, as well as marketing and tailoring its product and services mix to this very important demographic.
According to Shelly McGill, Veridian’s Central Iowa regional manager, offering the right products and services was very important to meeting Latino members’ unique financial needs. One of the actions Veridian took was to give members a viable alternative to expensive payday-loan centers and check-cashing services. To do this, Veridian introduced an affordable alternative to traditional payday lending outlets in early 2007. “The Payday Lending Alternative (PAL) loan features a savings component to help break the cycle of dependency on payday loans,” said McGill. “This program was a success almost immediately. Just two years after it was introduced, Veridian had already awarded more than 4,700 PAL loans to both Latino and non-Latino members.”
Veridian also started offering the Coopera Card, a prepaid card tailor-made for the Hispanic market. Quinceañera loans, checking and savings accounts, CDs (Certificates of Deposit) and credit card accounts, as well as home equity loans, round out the services of which Veridian’s Hispanic members take advantage.
In addition to those products, Veridian made an effort to enhance its member services. They became an ITIN (Individual Taxpayer Identification Number) acceptance agent to help community members apply for their ITIN number through the IRS, and also began to offer interest-bearing safe savings accounts and loans to Hispanic members without traditional forms of identification and documentation. Veridian’s ITIN loan offerings include credit builder loans, auto loans and consumer loans such as the PAL, share secured co-signer loans. The company also focused on offering financial education opportunities, like a credit builder loan program, to help immigrant families better acclimate to the U.S. financial system. Prior to hiring additional Spanish-speaking staff, the credit union incorporated an AT&T Language Line better-equip English-speaking staff to assist Spanish-speaking members.
To support these products and services, Veridian also began to enhance its internal infrastructure for Hispanic outreach. “We make a point to hire bilingual staff in our branches when the opportunity makes sense, even adding more staff in those locations with greater non-English speaking populations,” said Weekley, who noted the credit union currently employs 23 Spanish-speaking staff in its 26 branch locations. “We implemented a diversity training program for all employees to make sure everyone is on board with the company’s goals and efforts.”
Weekley added that Veridian started their outreach to the Hispanic community by forming an advisory council made up of staff and local community members. It helped the credit union better understand the Hispanic community’s needs and make recommendations on how Veridian could best meet those needs.
Veridian continues to focus its external marketing efforts on better targeting Latinos. “We create bilingual brochures and collateral for our products and services,” said Weekley. “And, we advertise in Spanish newspapers and on local radio stations. We make sure to participate in public relations opportunities, like providing information or quotes for articles in newspapers and magazines, to build awareness about Veridian and its outreach efforts.”
“We asked the council to review our initiatives to make sure they make sense for our Latino members,” said Weekley. “Advisory Council members reviewed materials to make sure our translations accurately reflect the messages we wanted to communicate.”
In addition to its marketing initiatives, Veridian’s external outreach efforts include becoming an active participant in the local communities the credit union serves. Every year, staff participate in local Latino Heritage Festival and Cinco de Mayo celebrations, as well as partner with organizations like J&E Entertainment in Iowa City, Ia., to host an annual Sunset Salsa event. And, each July, Veridian is the presenting sponsor for Festival Latino de Cedar Rapids in Cedar Rapids, Ia.
The cooperative is also active in community organizations. For example, McGill serves on the Latino Forum of the Urban Core, a Des Moines based group of members and supporters of the Latino community. “We really care about the people in our communities,” added Weekley, “and we are proud that our actions and intentions are authentic. The best way to prove this to our members is by truly becoming a part of their lives.”
All of these efforts have been successful thanks to the credit union’s hard work and dedication to this mission of improving its members’ lives. To continue its success, McGill noted that Veridian keeps up-to-date on the latest rules and regulations in the financial industry, makes sure the cooperative is offering products and services that not only make sense for members but that also comply with the law .
“Because we are a cooperative, rather than a for-profit business,” said McGill, “we can focus on doing what’s right for our members. Our results prove this is the right approach. In 2012, we experienced a 10-percent growth in our Latino membership.” Currently, 6,398 of the credit union’s 174,000 members are Latino.
Weekley concluded, “We truly listen to the voice of the people — not just guess which products and services Hispanic members need. We ask them for input and then deliver what they want. We are proud of what we’ve accomplished so far and will continue to look for ways to grow our efforts and opportunities in the future.”Leave a comment
When Greater Iowa Credit Union, headquartered in Ames, Ia., acquired two branch locations with large Hispanic membership populations, the senior leadership team knew the credit union had to step up its efforts to serve this important member segment. Focused on positively impacting its membership base, Greater Iowa implemented a Hispanic initiative, which started as a very marketing-centric approach and grew it to include full credit union involvement.
The first step Greater Iowa took was to apply for the Credit Union Remittance Outreach Program (CUROP) grant from World Council of Credit Unions (WOCCU), Coopera and the Iowa Credit Union League (ICUL). At the time, Greater Iowa did not have a remittance program in place and knew it needed help to implement a successful one if it was to provide an affordable and convenient alternative for Hispanic members sending money to loved ones in Mexico. “Greater Iowa was one of only three Iowa credit unions accepted into the program that year,” said Michael Adams, Greater Iowa’s vice president of marketing and public relations. “It became the jumping off point for the credit union’s entire Hispanic-focused effort.”
Adams became the point person for Greater Iowa’s external efforts, immersing himself in the initiative and leading the charge for the credit union’s Hispanic marketing, outreach and community-involvement programs. The company partnered with Coopera to guide them on next steps. “At Coopera’s recommendation, we refreshed our marketing collateral to be more focused on the Hispanic community’s financial needs, which included of course, Spanish translation,” said Adams.
He continued, “We also developed a portal site that our Spanish-speaking members can use any time to gain immediate access to our bilingual materials. And, we started advertising on the regional Spanish-language TV channel, on two Spanish-language radio stations and in two Spanish-speaking newspapers. In addition, we put together a testimonial TV commercial featuring one of our Hispanic members from the Denison branch.”
With Coopera’s guidance, Greater Iowa also gained insight into the cultural and lifestyle nuances of its Hispanic members. This knowledge enabled the credit union to further fine-tune its efforts. “We found with the Hispanic community that word-of-mouth referrals can really make or break a credit union’s success in a local market,” added Adams. “To increase opportunities to reach more members in the communities we serve, we began to take a more active approach toward earning positive word of mouth.”
According to Adams, this included participating in Iowa’s annual Latino Heritage Festival; speaking at industry events, such as the 2012 Latino Credit Union Conference in San Diego, Calif.; participating in editorial opportunities with industry media and starting an annual scholarship program for first- and second-generation Hispanic high school students.
Additionally, the credit union began to host its own member appreciation events throughout the year. For example, Greater Iowa’s East Des Moines location hosts an annual Fiesta de Navidad event during the Christmas season, and its Denison branch puts on an annual Cinco de Mayo event in May. “The first year we hosted our Fiesta de Navidad party, we had 300 people show up,” boasted Adams. “And, we’ve increased attendee turnout at the event every year since. We like doing these types of events because it gives us the opportunity to show our Hispanic members how much we appreciate their loyalty and trust in us.”
On the internal front, Greater Iowa started the Employee Implementation Team (EIT) to help the credit union expand the Hispanic initiative from a marketing campaign to a company-wide program. According to Adams, the EIT has played a very important part in expanding Greater Iowa’s Hispanic efforts. This includes advocating necessary changes to the board, senior management and key staff. For example, at the recommendation of the EIT, Greater Iowa’s HR department became very instrumental in growing the credit union’s Hispanic opportunities. “They worked with our current staff to better understand how to serve Hispanic members,” said Adams, “as well as hired bilingual staff to build up our talent base. Today, 10 of our 85 employees are bilingual.”
The EIT also initiated a monthly email communication to all employees, updating them on current issues affecting the Hispanic community, as well as on the credit union’s relevant products, services and programs. In addition, the team publishes a regular newsletter that provides in-depth details on the “who, what, when, where and why” of the credit union’s efforts. “These communications are so critical in helping us keep the importance of the Hispanic initiative in front of all employees,” said Adams.
Through EIT encouragement, the credit union’s business and product development teams have become more involved with the initiative. According to Adams, each of these teams has recognized that in order to allow Hispanic immigrants to open a checking or savings account, apply for a loan or take advantage of the credit union’s other financial services, customer identification policies needed to adapt to include the matricula consulate cards.
Going one step further, Greater Iowa also decided to offer a credit builder lending program, for individuals with either a SSN or Individual Taxpayer Identification Number (ITIN), branded the Préstamo Camino al Crédito or Path to Credit Loan— one of the first in Iowa. “This was a very controversial decision for Greater Iowa,” said Adams. “We knew the program might not be profitable right away because of the high cost of service in delivering these small dollar loans, but we saw great potential for its future revenue opportunities. To implement, we had to get full buy-in and support from our board and executive staff, as well as overcome some regulation challenges under the Bank Secrecy Act (BSA). We also had to lobby the program in the communities we serve to convince Hispanics that we wanted to work with them and support their financial needs.”
Adams said that although the credit builder lending program took two years to implement, it became very popular in a short amount of time. To further help newer Hispanic members become more integrated into the U.S. financial system, Greater Iowa offers Spanish educational seminars on topics like building a credit history and how to use online banking services. The credit union recently rolled out Spanish online banking services, which include a mobile app that’s available in Spanish and allows members to view their balance and transfer funds from one account to the other, amongst other services. “The Hispanic community has been so appreciative of our efforts and personnel,” added Adams. “It’s become symbolic of our company’s approach to the Hispanic initiative.”
According to Adams, the results of these efforts have indicated the success of Greater Iowa’s Hispanic initiative. “We have seen a change in character of our entire membership base,” said Adams. “Of the nearly 29,000 members we serve in 31 Iowa counties, approximately 8 percent claim Hispanic heritage, and we continue to see 3 percent quarter-to-quarter growth.”
Adams concluded: “My advice to any credit union looking to court the Hispanic community is that the credit union needs both internal and external advocates, like its Board, senior leadership, staff, an EIT committee and partners such as Coopera, who understand the credit union’s vision and can continue to move the company’s Hispanic initiatives forward. These advocates are ideal resources for communicating with stakeholders, developing and nurturing relationships in the local communities and encouraging employees to follow best practices for successful implementation.”Leave a comment
Associated Credit Union, headquartered in Norcross, Ga. (20 miles northeast of Atlanta), is one of the state’s oldest financial institutions. Chartered in 1930 to provide low-cost financial services to its members, Associated Credit Union’s mission has evolved and now includes better serving underserved populations, including the Hispanic community. To do this, Associated Credit Union laid out a multi-year, comprehensive strategic initiative and is in the process of implementing it.
“Several years ago, Associated Credit Union’s executive management team looked at the demographics of the Atlanta metro market from the 2010 Census numbers for opportunities to grow our membership base,” said Annia Reyes, training manager at Associated Credit Union. “The data drove our credit union to the strategic decision to focus on the emerging Hispanic population.”
What Associated Credit Union discovered through its research was that the overall Hispanic population in the metro Atlanta area at the time of the Census was estimated at 530,000. From a county perspective, Gwinnett County, which houses six out of Associated Credit Union’s 28 branches, contained the largest population of Hispanics at an estimated 190,000 and was noted as one of the fastest growing counties for Hispanics in the state. In fact, it is estimated that by 2020, 40 percent of the population in Gwinnett County will be Hispanic.
Equipped with this information, Associated Credit Union turned to Coopera for guidance. The credit union utilized the company’s Hispanic Opportunity Navigator (HON) to better understand what was needed to serve the local Hispanic community.
Thru further research, Associated Credit Union discovered that the median age of the Atlanta metro Hispanic market was quite young, between ages 25 and 26, with annual personal earnings ranging from $17,000-$23,000. And, this trend was expected to continue for years to come, as 11 percent of K-12 students in the Atlanta area were Hispanic.
“With Coopera’s help, we were able to put together a rough sketch of our project plan,” said Huff, project management manager at Associated Credit Union. “We then customized the plan to best meet our objectives and to best serve our new members. We knew we needed to find out what Hispanics in the Atlanta market really needed and wanted out of a financial institution.”
Led by a 15-person implementation team, comprised of both management and frontline staff, Associated Credit Union began to lay the foundation and framework for this initiative. The process included gaining a better understanding of staffing needs, an evaluation of products and services, as well as the development of promotions and new marketing materials. It also included internal education and communication. “With this strategic initiative, we were dramatically changing the culture of the organization to become more diverse,” said Reyes. “We are not only committed to our members but to also our staff. It’s crucial that our employees are well informed and receive consistent, on-going training.”
The implementation team quickly took charge, initiating periodic staff training meetings on Wednesday mornings before the credit union opened for business, as well as, putting together staff events around local celebrations like Cinco de Mayo. Reyes, Huff and members of the implementation team also held monthly meetings with Associated Credit Union’s executive management team, as well as provided regular updates to the management team during the bi-weekly managers’ meeting. “Building a solid Hispanic outreach initiative is a marathon, not a sprint,” said Reyes. “We had full buy-in from the credit union from the beginning, and it was our job to keep things fresh and exciting during the process to make sure everyone stayed motivated through implementation. Keeping the lines of communication open at all levels of the credit union has been critical.”
Initially, the plan was to roll out the project in four branches, but as the implementation team continued to work on the initiative, they decided instead to “soft” launch in one branch first. “We tweaked our rollout strategy because of the reality of staffing needs and the learning curve, both internally and within the community,” said Huff. “We did a market analysis of Associated Credit Union’s entire operations area, which helped us determine that we needed to focus our initial efforts in our Norcross branch location. We then worked to hire bilingual staff in that branch, as well as in all of our customer-facing departments (i.e. the call center, loan processing center and so on).”
At this point, Associated Credit Union hired its first branch manager from outside the organization in 30 years. The candidate was bilingual and had industry experience that would help lead the charge in the Norcross branch.
Initial launch efforts have focused on word-of-mouth outreach, as well as advertising in a local Spanish newspaper, Mundo Hispánico. Also, Associated Credit Union’s marketing department worked to create bilingual versions of the credit union’s most-used collateral, including membership applications, deposit slips and product and service handouts.
The credit union also worked to make sure its products and services were able to meet the needs of all its members, including Hispanics. The implementation focused on making sure Associated Credit Union’s rate-reward loan program and first-time car buyer programs were available during the soft launch, as well as working with Associated Credit Union’s vendors, like its reloadable prepaid debit card supplier, to make sure these vendors’ customer-facing departments offered bilingual support. The credit union is also investigating adding remittance products in the near future to make sure the credit union is meeting the money transfer needs of the Hispanic marketplace.
Other future initiatives include adding a Spanish page to the credit union’s website, as well as broader community outreach efforts, such as financial literacy programs and local business partnerships.
“We know that growing our Hispanic membership base will not happen overnight,” said Huff. “Even after our successful soft launch there is much work to be done yet. We are taking a conservative approach to growing opportunities with all emerging markets to make sure we’ve set reasonable objectives and are meeting our plan’s milestones.
“Our initial goal is to grow five percent in Hispanic membership over the course of the upcoming year,” continued Huff. “Out of this, we would like between 60-65 percent of these new members to open a checking account and request a debit card. As we become more familiar with the Hispanic membership needs, and as they become more trusting of us as a financial institution, we will then focus on really growing loans with the new Hispanic membership.
“It is our objective to become the primary financial institution for Hispanics in the Atlanta market, especially Gwinnett County,” finished Huff. “And we’re willing to make the necessary investments to see this happen.”Leave a comment
Sometimes referred to as the “Mexican St. Patrick’s Day,” Cinco de Mayo (held each year on May 5th) is one of the most misunderstood holidays we celebrate in the U.S., even by people of Mexican heritage.
Despite its reputation, Cinco de Mayo does not mark Mexico’s Independence Day. That is celebrated on September 16, the day in 1810 when Father Miguel Hidalgo took to his pulpit in Dolores, Querétaro, and urged his congregation to join him in efforts to overthrow the Spanish tyranny in Mexico. The celebration is also known in Mexico as El Grito de Dolores or “Cry of Dolores.”
Cinco de Mayo is actually a regional holiday in Mexico, called El Día de la Batalla de Puebla, celebrating Mexico’s victory over the French on May 5, 1862, during the Battle of Puebla in the American Civil War. Although Cinco de Mayo is a big holiday in Puebla, it is actually celebrated more in the U.S. than it is in most of Mexico. In the U.S., Cinco de Mayo is celebrated with parades and festivals that offer plenty of traditional Mexican food, cold beverages and music for participants. The holiday has really become more about celebrating the Mexican way of life than about remembering a battle that happened 150 years ago in Mexico.
Just as there is a misconception about Cinco de Mayo, there are also common misconceptions about Hispanics and the Hispanic culture of which credit unions looking to better serve this market should be aware. These include:
– All Hispanics are Mexican. “Hispanic” is a U.S. Census term often used to refer to people of Latin American and Spanish origin regardless of race. U.S. Hispanics have roots in 21
– All Hispanics are Catholic. About 62 percent of Hispanics are Catholic, but there is a growing conversion rate from Catholicism to other religions. In fact, the Mormon church recently reported the number of Spanish-speaking Church of Jesus Christ of Latter-day Saints congregations in the U.S. rose from 389 in 2000 to more than 760 at present. According to a Pew Hispanic survey, 83 percent of Hispanics claim a religious affiliation, and one in five (19 percent) say they are Protestant. Fourteen percent of Hispanics say that although they are religious, they are unaffiliated with a particular religion.
–Hispanics speak several different forms of Spanish. While not all Hispanics speak Spanish, Spanish is the overarching language for many Latin American countries. According to Pew Research, more than 80 percent of Hispanic adults say they speak Spanish. Even though there are cultural nuances in the Spanish language, there are not completely different forms of the language in Latin American countries — the basic language structure of Spanish is shared.
That said, there may be different colloquialisms or words, phrases or statements, unique to a certain culture or region. To best serve your local Hispanic community, it is important to learn the make-up of the local population. Coopera can help with a comprehensive market analysis.
Rest assured, however, the basics of the Spanish language will be understood by your Hispanic members regardless of the Latin American country from which they hail.
–All Hispanics are poor immigrants. Not all Hispanics are immigrants (foreign nationals born outside of the U.S.), and the U.S. Census Bureau reported that there were over 2.1 million Hispanics in the U.S. with personal income over $65,000 in 2011. Today, the U.S. Hispanic population is made up of multiple generations of people from different countries of origin, from different income levels and different life experiences. Each Hispanic in the U.S. today can claim his/her own characteristics, beliefs and behaviors.
The Hispanic market in the U.S. is rapidly growing and changing, which presents important opportunities for credit unions that invest the time and resources in preparation for further expansion. One way to learn more, and to prepare your staff, is by investing in a resource like CUNA’s training-on-demand resource Hispanic Immigration Course. By becoming more familiar with the nuances of the Hispanic population, credit unions will be better positioned to provide for these members’ needs.Leave a comment