A decade ago, the roots of Coopera were planted by a visionary credit union leader with big dreams for the future. Warren Morrow saw more than 45 million Hispanic people, each working to enrich their communities across the country.
He asked, “How can credit unions become providers of choice for dignified financial services in this emerging community? How can the credit union industry better serve this segment – the largest, fastest-growing, youngest and most financially underserved minority group in the United States?”
Rather than wait for those questions to be answered, Warren set out to answer them. His enthusiasm for improving the financial lives of Hispanic consumers was contagious. As more leaders in the credit union movement saw the opportunities, Coopera began to grow.
Over its 10-year history, Coopera has worked with more than 200 credit unions, credit union system organizations and non-credit unions located in 30 states across the country and has served more than 1,000,000 Hispanic consumers. The firm applies the diverse expertise and skill sets of its leadership to carry out the vision of Coopera’s founder.
Within its first year, Coopera, in partnership with the Iowa Credit Union League and Iowa Credit Union Foundation, launched a state-wide asset-building and savings account program for working Iowans and partnered with credit union associations in New York and Louisiana to mobilize more cooperatives around the mission of serving Hispanic members.
By the end of 2009, Texas, Nebraska and Georgia credit union leagues, as well as the Credit Union National Association (CUNA) had joined in the mission. Together, CUNA, the leagues and Coopera built tools, conducted research and created educational programs.
As the first decade of the new Millennium was coming to a close, CUNA and Coopera teamed to create El Poder es Tuyo (The Power is Yours), the only Spanish-language personal finance website for Hispanic credit union members. Today, the site reaches Hispanic members in more than 14 states across the country.
Building tools to improve the financial lives of Hispanic consumers continued. In 2001, Coopera partnered with its payments processing sister company TMG, now a part of CO-OP Financial Services, to build a prepaid card especially for the unique needs of the Hispanic consumer. The card was rated as the 5th Most Affordable Prepaid Card by NerdWallet.
Five years into its mission, the Coopera team lost its founder when he passed away unexpectedly. Yet Warren’s crystal clear vision continued to guide the leaders of this fast-moving company.
California and Nevada credit unions got on board in 2012, partnering with Coopera to study the Hispanic consumer segment and create multi-state educational opportunities for credit union leaders.
As Coopera honed its research and training skills, it became evident these were core competencies that could benefit even more cooperatives throughout the country. As a result, the company launched a series of Hispanic Market Analysis tools and an online resource library for professionals who wanted to grow their own Hispanic market expertise. Credit unions using these analysis tools have seen annualized Hispanic membership grow nearly four times as fast as that of non-Hispanic members. What’s more, checking and lending penetration rates at these credit unions have increased twice as fast as that of non-Hispanic members.
In 2015, Coopera’s decade of achievement was recognized alongside its AMC family of companies with one of the highest honors the credit union industry has developed, the Herb Wegner Memorial award.
Over the past several years, Coopera and its partner the Federation have put the Juntos Avanzamos designation on a national stage. A signal to Hispanic consumers that a credit union has their best interests in mind, the designation is another way to communicate credit union’s passion for and willingness to serve the Hispanic community.
Over Coopera’s 10 year history, many strategic partners have helped raise awareness of the struggles faced by Hispanic consumers, but also the great opportunity they represent. These organizations have helped hundreds of credit unions realize the influence and the value of what remains America’s largest, fast-growing, young and financially underserved minority group.
It’s a message that’s expanding far beyond the credit union space. Executives and business leaders in insurance, health care, higher education and many others are answering the call to adapt to the unique needs of a multi-faceted Hispanic consumer segment.
In just under a decade, the Hispanic community grew from 45 million to more than 57 million.
10 million in 10 years. That’s explosive growth. That’s amazing opportunity.
Many of that 57 million are still seeking the American dream. And, credit unions are helping them achieve that, one member at a time. In fact, 25 percent of Hispanics in the U.S. are now credit union members.
Coopera’s team of Hispanic market experts is also beginning to work with businesses and organizations beyond financial services. Its leaders, which include De Dios, Client Relations Director Alba Perez, Client Support Specialist Lizeth Aquino and Project Assistant Kenia Calderon, are applying their knowledge of emerging markets to engagement with other industries, as well.
As more businesses, organizations and community leaders are inspired by the credit union movement’s success, Coopera will be there, ready to partner for the success of their organizations and the greater Hispanic community.Leave a comment
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
In 2006, Des Moines Metro Credit Union (DMMCU), headquartered in Des Moines, Ia., performed an in-depth analysis to determine whether opening a new branch was the best way to grow their membership base. The credit union had endured several years of negative membership growth and wanted to reverse that trend. The analysis revealed that DMMCU was not maximizing opportunities to best reach and serve the households around the credit union’s existing locations. Before they could successfully open a new branch, the credit union’s leadership decided it would make sense to improve penetration in their current markets.
“We determined that the local Hispanic community was an ideal demographic target for growth,” said Traci Stiles, DMMCU business development manager. “Our branch is located near the Des Moines Hispanic community’s homes and workplaces. We knew we could gain board and staff support to offer much-needed services that would meet Hispanic members’ financial needs. It made a lot of sense for us to become a more active member in this community.”
Stiles and her team knew they would not be able to take the credit union in this new direction without help. They turned to Warren Morrow at Diverse Innovative Solutions, which later became Coopera, to guide them. “Coopera has been a key resource for us,” said Stiles. “In collaboration with Coopera, we have been able to keep up-to-date on best practices in the financial industry, as well as the Hispanic community, to gain new ideas for better serving our membership.”
The Coopera team has also been able to help DMMCU better understand the differences between Hispanic consumers and other DMMCU members. Armed with this knowledge, the DMMCU leadership, with Coopera’s guidance, has also been able to develop products and services that best match the Hispanic community’s cultural and lifestyle nuances.
One of the first products DMMCU implemented was remittance services through Vigo. Also, DMMCU initiated a credit builder loan program. “Our Credit Builder Loan has been the most successful product we’ve implemented to date,” said Stiles. “We started the program in the fall of 2009, and we’ve had over 65 members who have graduated from the program. The program has given us the opportunity to help members with one-on-one financial education as they build their credit. We’ve had minimal risk by using consistent underwriting guidelines, and the program has created loyal, life-long borrowers for DMMCU.”
In the first quarter of 2012, DMMCU also began offering the Coopera Prepaid Reloadable Visa card, a prepaid card program tailor-made for the Hispanic market. According to Stiles, the Coopera Card has turned out to be a popular product with the credit union’s entire membership. “We have sold more than 165 Coopera Cards since the launch.”
As DMMCU’s Hispanic outreach has evolved, the credit union has enhanced its member referral program to capitalize on the increased referral potential offered by the Hispanic community. Today, any current DMMCU member who refers a new member to the credit union gets entered into a monthly drawing for $100.
Products and services were not the only areas the credit union re-tooled to better focus on growing DMMCU’s Hispanic membership. According to Stiles, DMMCU also had to examine its current policies and procedures to make sure they accommodated growth in the Hispanic market. “We examined and altered our policies to allow Hispanics to use matricula consular cards and ITINs to open accounts,” said Stiles. “We also educated our staff about various forms of compliant identification.”
In addition, Stiles and the DMMCU team re-evaluated their marketing efforts to best target the Hispanic community. Today, the credit union’s efforts include bilingual materials, member testimonials and advertising in the local Hispanic media. For example, DMMCU recently used a testimonial from a female Hispanic member who was able to purchase her first car through the credit builder program. “We make sure to solicit feedback from our bilingual staff on existing and new products and services. Also, we make them aware of our community advertising campaigns to make sure we are doing everything we can to be successful,” said Stiles.
“We also track the language preferences of our members so when we do a bilingual direct mail piece we can identify members who speak Spanish,” added Stiles. “We also use Coopera’s Hispanic Member Analysis and Hispanic Opportunity Navigator to track our progress with our target market on a monthly and quarterly basis. Whenever we consider operational, product, or service changes/enhancements, we have to keep the Hispanic market in mind because they are becoming a larger part of our membership. Coopera has been instrumental to our success in each of these areas — from providing us with best practice examples to hosting quarterly and yearly board updates to helping us with reporting and benchmarking.”
DMMCU has become heavily involved in community outreach efforts, such as the Bank On Central Iowa* initiative. This program brings together financial educators, banks and credit unions to help improve financial education and access to underserved consumers, including Hispanics. “We strive to continually form partnerships with businesses and organizations, like Hispanic Educational Resources, that serve the Hispanic population in our area. We participate each year in the local Latino festival during Hispanic Heritage Month, as well as provide volunteers for other cultural events throughout the year.”
For a credit union of DMMCU’s size, Stiles feels the cooperative has made huge strides in serving the Hispanic community. The biggest indicator of success, according to Stiles, is membership growth. “Prior to our efforts with the Hispanic community, we were experiencing negative membership growth,” said Stiles. “In 2009, we began to see positive membership growth and have had positive growth every year since. Our average member age also continues to decrease. We have built the solid foundation with our board, staff and local community, and as a result, we are really seeing our hard work pay off.
The results are not always quantitative, said Stiles. “Our Hispanic members have told us how much they appreciate the friendly, individual attention our bilingual employees provide — we’ve built a strong foundation of trust with them,” added Stiles. “We strive to make sure they feel respected and are given affordable alternatives to higher-cost financial services.”
Stiles offered up these final insights: “My advice would be no matter how big or small, if a credit union has buy-in from all levels of the organization — the board, management and staff — it can successfully serve the Hispanic market, or any target demographic. It’s also important to monitor, track and recognize when processes, procedures, products and services need to be evaluated and adjusted. When you lay the proper foundation, you are bound to have success.
“I’m very proud of what we’ve accomplished at DMMCU,” concluded Stiles. “It’s positive for our credit union’s growth, and because our members have the opportunity to take advantage of affordable financial services, it’s very rewarding for them, our credit union, and the credit union industry.
For more information about the Bank On Central Iowa initiative, visit the article “Financial Education Helps Out Unbanked” in the Des Moines Register. An online version of the article is available at: http://www.desmoinesregister.com/article/20130702/NEWS/307020041/Financial-education-helps-out-unbanked?Frontpage.Leave a comment
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.
At the time Ascentra Credit Union, headquartered in Bettendorf, Iowa, first attempted to reach out the Hispanic community, it had five branches, and of those, two were in cities that showed a Hispanic population growth rate higher than national averages. With corporate America already acknowledging the importance of tailoring its products and services to Hispanic consumers, Ascentra made the decision to follow suit.
“Hispanics are a very loyal, extremely young and fast-growing population shaping the future direction of business and commerce in our country,” said Alvaro Macias, Ascentra community development coordinator. “Unfortunately, it’s a population that is largely underserved in the financial services industry. As Ascentra began to realize the influence and impact Hispanics will have in the future, we knew it was not only right to help reach out to this underserved segment but it was a good business decision for our credit union to focus on growing our outreach.”
Ascentra took steps to make sure it’d be successful in its Hispanic outreach efforts. Management initially asked three bilingual employees for ideas on how to reach this segment of the population. Some advertising was purchased and small events that catered to the Hispanic population were sponsored, but there was no formal Hispanic outreach plan or goal.
Then, they hired Coopera, a leading expert in credit union service to Hispanics, to conduct a member analysis of their operations areas, as well as to provide guidance on Ascentra’s initiatives. These initiatives included things like product and services development and marketing campaign implementation. Coopera was also instrumental in training Ascentra’s staff on the credit union industry’s changing laws and regulations impacting service to Hispanic members.
The credit union then created Macias’ position in the company to make sure the credit union was focused on building a solid foundation in the Hispanic community. According to Macias, Ascentra also added more bilingual staff to the credit union, as well as translated a page on its website into Spanish. Today, 18 out of the credit union’s 123 employees are bilingual. And, the webpage www.ascentra.org/espanol includes the names, pictures and contact information for all bilingual lending officers and call center representatives within the company.
Ascentra formalized its Hispanic Outreach Program initiative, as well as created two advisory councils, one made up of staff members and another with local community members to provide input and insight into the credit union’s and the competitions’ efforts.
“Ascentra’s initial efforts with a formal plan may have started out as more of a business development initiative for the credit union,” said Macias. “But, most recently when the member analysis from Coopera showed that 63 percent of our new member growth in 2011-2012 was from the Hispanic segment, it confirmed in some of our minds that targeting this group was a key credit union-wide growth strategy.”
To better serve Hispanics’ unique financial needs, Ascentra has introduced several products and services tailored for this underserved demographic. These efforts included money wire services to Mexico, ITIN lending and Quinceañera loans. The credit union also launched its suite of “Préstamos Para Mi” or “Loans for Me”, which is a small signature loan product that is marketed as a way to pay for life events, such as applying for citizenship, traveling to home countries and making large purchases like furniture or electronics.
From a marketing perspective, the credit union also made some changes to its campaigns to better target potential Hispanic members. “We cut out billboard advertising, as its reach and messaging was too broad. We didn’t want to convey to prospective members that our membership was exclusive to Hispanics,” said Macias. “Also, we started listing some of Ascentra’s bilingual loan officers’ names and contact information in our advertisements so new-member prospects could call them directly. Our team started getting calls right away.”
Other marketing efforts consisted of bilingual advertising, collateral and branch signage. Macias explained, “Our advertising efforts included a mix of local Spanish/English newspapers, a college radio station that has Spanish programing several times a week and a TV commercial during a Hispanic show on a local TV station. We also began offering Spanish marketing collateral for Ascentra’s products and services, as well as have signage in our branches to announce to visitors that we accept matricula cards as a form of ID to open accounts or obtain loans.”
A big push in Ascentra’s Hispanic Outreach Program was to get more involved in its local communities. According to Macias, the credit union has become involved in the Mexican consulate’s mobile visits — events to help Mexican nationals living here obtain matricula cards and passports. At these events, Ascentra staff is on hand to talk about attendees’ financial needs, as well as to invite them to stop by the credit union to open accounts, obtain loans or plan for their futures.
Macias said the member response to these efforts has been phenomenal as after every event the last 2 years, people came to open accounts or obtain loans. “Hispanic members love that they can talk with someone in Spanish who understands their needs and can explain how Ascentra can help them,” said Macias. “But, it’s definitely about more than language. Our staff goes above and beyond to make each of our members feel welcome and valued.”
Ascentra is also a supporter of the Greater Quad Cities Hispanic Chamber of Commerce and was recently recognized by the Chamber as Corporation of the Year. Macias serves as a board member on the Greater Quad Cities Hispanic Chamber of Commerce and chairs the events and program committee. As part of his Community Development Coordinator role, Macias also has conducted financial education seminars on budgeting and planning, as well as building credit, in both English and Spanish at a local church and at a Casa Quad Cities event.
The results of these efforts demonstrate that Ascentra is on the right track with its Hispanic Outreach Program. In 2012, for example, the credit union processed 89 ITIN loan applications, resulting in 59 loans. These were all small loans under $2,500 which were generally used for consolidation, credit building, and “to get by.” Sixteen of those loan recipients became credit card members as well. Macias offered additional proof: “As of last October 2012, 7.7 percent of our membership is calculated to be of Hispanic heritage,” said Macias.
Macias added these final thoughts, “For credit unions interested in adding more Hispanics to their membership base, my advice is to perform solid due diligence to understand the culture and specific financial needs of this important segment. Embrace what you learn and make any necessary changes to your credit union’s culture to accommodate these members. It is so important that you go to them — don’t expect them to come to you. This includes being at events in the Hispanic community, talking with the people there and being genuine in your efforts to show them that you care.”
“Although Hispanic outreach efforts can take a long time to implement and yield measurable results, know it’s a marathon, not a sprint,” Macias concluded. “Overtime, the rewards become worth every bit of the effort.”Leave a comment
Also known as cundinas, sans or quinelas, tandas are informal borrowing and lending circles that provide an alternative to a traditional savings account and a loan from a financial institution. Quite simply, tandas allow for a short-term, no-interest loan and savings account among friends and family.
Growing up in California and Iowa, my parents participated in tandas with their friends, co-workers and neighbors. Before they established accounts at financial institutions (and even a few times after), my parents turned to tandas to save and borrow money outside of the financial mainstream.
Tandas typically work in the same fashion — a group of people already acquainted with one another collect money to help each other financially. A leader, whom is acquainted with tandas, gets the group together and is responsible for collecting, holding and distributing the money. The leader usually sets the rules aimed at benefiting the entire group, including the amount of money collected, when the money will be collected and the number of people in the group. Once these parameters are established, the leader randomly chooses the order of whom is going to receive the money. Most often, tandas distribute money through a raffle or make the decision based on the individual(s) believed to need the money most.
Here’s an example of how a traditional tanda could work: The tanda is formed with 10 friends and family. Each member contributes $100 every two weeks to the group leader. At the end of the month, one participant gets the “pot” of $2,000. This process continues until each member has received the pot.
The tanda played a very important role in my family life. Each time that my parents borrowed from the tanda, the money was earmarked for specific expenses, such as furniture for our first house, immigration expenses as we were going through the process of adjusting our status in the U.S. or trips to Mexico to visit family.
I remember taking turns going with either my mother or my father to the tanda group leader’s house when we moved to Iowa. She was a neighbor — someone everyone in the Latino community knew and trusted. The tanda leader was also an entrepreneur. She sold jewelry and home interior products to the community, which my parents also bought from her. My parents would give her their $100 payment in cash, usually after my father got his paycheck cashed from work. The tanda leader would then store the cash in a little cash box in her office desk and would note my parent’s payment in a notebook.
I also witnessed my parents pulling a number from a box, letting them know when it would be their turn to receive the lump sum from the tanda.
When I was a teenager, my parents began to entrust me with delivering the $100 payments. As the oldest child in my family, this was a big responsibility but seemed very simple to do. Throughout my childhood, I did not realize that there was an alternative to saving and borrowing money at a traditional financial institution because I was used to seeing my parents cash their checks, borrow and save completely outside of the financial mainstream.
Tandas were convenient, they involved people that we knew and trusted, and they helped my family out financially when we needed it.
Although very small in nature, tandas are making big headlines. NPR’s Changing Lives of Women series and Code Switch have each covered the topic in recent months. The article, Lending Circles Help Latinas Pay Bills and Invest, is one example. Modern tandas are aiming to bridge a cultural custom with the credit union experience.
To leverage the benefits and emotional, cultural and community connections of the tanda on a larger scale, Coopera worked with Travis Credit Union (TCU) based in Vacaville, Calif. through a grant from the National Credit Union Foundation, to create the modern version of a tandas — the New Era Tanda Program. This program was specifically designed to bring the concept of the tanda to the credit union, where people helping people is the organization’s primary mission.
In addition to supporting Latino families save and borrow, the program helps individuals open accounts, build a credit history and receive financial education.
Participants in the program contribute on a monthly basis to a shared savings account and also receive a group share-secured loan to help save for a down-payment on a vehicle. After satisfactory completion of the program, each participant is eligible for a TCU credit-building credit card and/or auto loan. The program uses a grassroots and culturally relevant approach tailored to the local Latino community.
TCU’s program is just one example of how tandas can work in the mainstream financial system. Through modern tandas, credit unions of any size and in any location can realize tremendous opportunity to engage with the Latino community, as well as to bridge cultural traditions and customs with good financial alternatives.Leave a comment
The Hispanic market in the U.S. continues to grow and change at a rapid pace, which will present significant opportunities (and challenges) in 2014. One of the most important ways to prepare right now to better serve Hispanic members in the coming year is to conduct an audit of your bilingual marketing materials and signage.
One of the most common misconceptions about the Hispanic culture is that Hispanics speak different forms of Spanish. Although there are different colloquialisms or words, phrases or statements that are unique to a certain culture or region, there are not completely different forms of the language — the basic language structure of Spanish is shared. Because there are cultural nuances in the Spanish language, it is important for your credit union to make sure that your translations are accurately conveying your messages. The best way to accomplish this is by performing what are called “back translations.”
What is a back translation? It is a second translation of text back to the original language (in most cases, English) to ensure developers understand the final meaning of their translation.
When the source language is English, there is often discrepancy in the meaning between the original source and the back translation. Spanish, for example, has a notably different vocabulary, and many words that are used in English simply don’t exist. Back translations should be performed to ensure that the language is a correct translation of the original, in which, the meaning was not changed, but also the readability of the text has not been affected through the translation process. The process should include conducting at least two back translations and working with the original translation to accommodate the findings of the back translation.
Here’s an example: When you translate the English phrase “all the rage” to Spanish, you do not want to convey the literal meaning but rather the cultural meaning of that phrase. The Spanish translation of this phrase could be “lo ultimo.” A back translation of “lo ultimo” would tell you that you are translating “all the rage” to a similar phrase that will be understood in Spanish that means “the latest.”
The important thing to remember when doing back translations is that the person doing the back translation should be familiar with the original version in English to avoid inadvertently changing meanings of the content. For credit unions, here are some examples of common phrases you’d likely have translated and the corresponding back translations:
English source: Limit our sharing
English source: Build Credit
To prove how easy it can be to incorrectly back translate certain phrases, here are some examples of back translations gone wrong:
English source: Batch (transactions)
English source: Arrangement between two parties
Although they may seem to be a time-consuming and expensive task, back translations are a critically important part of your credit union’s validation and cultural adaptation to specific Hispanic markets. Doing back translations can help to avoid errors, as well as better understand what the credit union has had trans-created. For instance, many credit union compliance or legal departments request back translations to double check that approved messages are what is truly being distributed to members.
By becoming more familiar with the language nuances of your credit union’s local Hispanic population, you will be better positioned to provide for these members’ needs. For credit unions willing to invest the time and resources, the benefits of a bilingual marketing audit will greatly outweigh the perceived costs.
To best understand 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.
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More than one in four households (28.3 percent) in the U.S. today is underserved, conducting all or some of their financial transactions outside of the mainstream banking system. Hispanics represent a disproportionate number of this group — in fact, there are nearly 7 million Hispanic households in the U.S. that are underserved. This means that about one out of every two U.S. Hispanics falls into this classification.*
Because of the U.S. Hispanic market’s sheer size, youth and rate of growth, it represents a large market opportunity for credit unions. Creating products and services to specifically meet the needs of underserved Hispanic consumers can give your credit union a significant competitive advantage in 2014.
When it comes to attracting Hispanic consumers — underserved or not — one-size-fits-all financial products and services don’t work. As your member base continues to diversify, it is unrealistic for you to expect the Hispanic community to conform to your products and services — it’s got to be the other way around. Therefore, if your credit union is looking to attract more Hispanic members in 2014, you need to plan now to provide fair, dignified and tailored financial services.
Fortunately, there are many products offered by credit unions across the country that have been created with the Hispanic consumer in mind and are a good fit for the Hispanic market. The products include culturally relevant savings programs, prepaid reloadable card; auto, micro and lifestyle loans (for quinceañeras, weddings, immigration, citizenship, travel, etc.) and financial education. If you don’t already have these products in your portfolio, now is the time to add them.
And, even more products are on the horizon. the Filene Research Institute, is currently testing four products to benefit underserved consumers, including Hispanics, in its new financial services incubator.
Here’s a quick synopsis of these products:
-Non-prime Auto Lending from the National Credit Union Foundation. This program helps lenders fairly price and manage non-prime auto loans, incorporating the Lower Interest For Timeliness (LIFT) idea introduced by Filene’s i3 innovation team. LIFT is a loan feature that reduces interest rates when members make on-time payments.
-Borrow and Save from the National Federation of Community Development Credit Unions. This product increases consumers’ economic security by providing an affordable small-dollar loan with a payment term that makes sense for them. A built-in savings component also helps consumers self-fund their emergencies instead of borrowing money to handle them.
-Pay Yourself Back from Innovations in Poverty Action. As an add-on to any loan type, this product seamlessly converts borrowers into savers. Leveraging the habits formed by regularly making loan payments, it encourages consumers to keep making regular payments (or a portion of them) to themselves after the loan is paid off.
-Employer Sponsored Income, Advance Loan from North Country Federal Credit Union. This small-dollar loan program is offered to employees of select employer groups (SEGs) partnered with credit unions. Loan payments are auto-deducted from direct-deposited paychecks. Once the loan is paid, employees may continue making payments into savings accounts.
At Coopera, we see a lot of potential in these products for Hispanic consumers. We have found that many Hispanic consumers aren’t aware of what financial services are accessible to them, as well as struggle with basic financial education around money management and building/maintaining credit. These new products from Filene could help address these gaps and guide underserved Hispanics on a path to achieve their financial goals. We will keep you posted on how the testing phase of these products goes, as well as the potential for implementing them into your current product mix.
*For more information about the demographics of Hispanic consumers, download the Coopera white paper “The Multifaceted Hispanic Market” at http://tinyurl.com/c8jwf45.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
Coopera client Travis Credit Union (TCU), the Yolo Family Resource Center (FRC) and Woodland, Calif., city officials recently honored the first class of graduates from the credit union’s New Era Tanda Program. Debuted in mid-2012, the program was designed to help Latino participants develop a 12-month shared savings goal and to take advantage of the credit union’s unique savings and loan offerings.
TCU worked with Coopera to develop the program concept for this unique program centered on tandas (also known as cundinas, sans or quinelas). Informal borrowing/lending circles, tandas are common in immigrant cultures, especially Latin American immigrant cultures. The modernized tanda, developed by TCU, aimed at bridging a cultural custom with the credit union experience.
Funded in part by a National Credit Union Foundation grant, TCU partnered with the Yolo FRC to conduct the pilot program. The program used a grassroots and culturally relevant approach tailored to the local Latino community. The first New Era Tanda Program class was composed of six people, each of whom was encouraged to attend monthly financial literacy courses, all offered in Spanish.
Participants contributed on a monthly basis to a shared savings account and also received a group share-secured loan to help save for a down-payment on a vehicle. In addition, after satisfactory completion of the program, each participant was eligible for a TCU credit-building credit card and/or auto loan. Throughout the program, participants and their families were encouraged to discuss how the various financial educational topics and the act of habitual saving affected their financial well-being.
“The grant’s goal was to study, test and implement a savings and lending program that leverages a Latin American cultural tradition, the tanda,” stated Barry Nelson, executive vice
After graduating from the program in August, participants became eligible for TCU’s individual product offerings to meet their credit-building and/or vehicle-purchase goals.
As with any good pilot, measuring the results was incredibly important to TCU, NCUF and Coopera. TCU worked with Coopera to create pre- and post-surveys to measure and track the change in each participant’s financial beliefs and behaviors. These surveys were administered at the start and end of the program. One of the goals of the program was to build Hispanic members’ credit and good financial habits through financial education. The findings were exciting.
Congratulations to TCU, Yolo FRC and the New Era Tanda program participants on a job well done!
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