The 2017 Warren Morrow Hispanic Growth Fund Grant will help seven credit unions continue their Hispanic outreach and community impact efforts. Named in honor of the late Warren Morrow, who dedicated his life and career to helping the underserved and empowering the Hispanic community, the grant is made possible by Coopera, CUNA and the National Credit Union Foundation. Each of the grant recipients is a Juntos Avanzamos-designated cooperative, a program taken to the national stage by the Federation.
This post details how three of the grant recipients plan to allocate the funds. We will cover plans of the remaining four recipients in an upcoming post.
Members Credit Union (MCU)
“Along with financial education, we will bring opportunity for membership in a safe, Hispanic-friendly financial cooperative where they will receive low-cost services that are relevant to their lives and financial counseling to help them meet their goals,” said Kathy Chartier, MCU president/CEO. “We often see members and potential members who are taken advantage of by large banks and predatory lenders. This program is specifically directed toward the Hispanic community with the goal of helping them improve their financial understanding and well-being.”
Nueva Esperanza Community Credit Union (NECCU)
“NECCU offers a comprehensive level of bilingual financial services to impact the needs of our target market,” said NECCU President/CEO Sue Cuevas. “We integrate financial services with education to improve members’ financial competency. In addition to basic financial services, staff deliver one-on-one orientations to new members when they inquire about share savings or share certificates of deposit. This empowers members with tools to understand their financial situations, set goals and develop paths to asset building/ownership.”
Point West Credit Union
“Point West is endeavoring to engage the local Hispanic community where they live, work, socialize and seek assistance and services, while also testing a branching model outside of the traditional brick and mortar solutions,” said Steve Pagenstecher, Point West vice president of member experience. “By providing a full-service ATM coupled with an experienced and educated Point West employee, the goal is to increase access to an underserved community while driving Hispanic membership growth and financial outcomes for the community.”
Please join me in congratulating each of these cooperatives for recognizing that serving the Hispanic community is not only the right thing to do, it’s smart business, as well.Leave a comment
A Nielsen report released last month details the growing consumer power and influence of Hispanic females living in the U.S. According to the report, Latina 2.0: Fiscally Conscious, Culturally Influential & Familia Forward, this demographic grew 37 percent between 2005 and 2015, compared to 2 percent for their non-Hispanic White counterparts and 11 percent for total women in the U.S. Younger Hispanic women are also outpacing the rest of the nation in buying power.
Below are a few key findings in the report, along with actions credit unions should consider – especially as we close out another successful National Hispanic Heritage Month.
Credit union actions: Consider starting a program to provide young entrepreneurs access to capital, mentorship and networking opportunities – with a special focus on Hispanic women.
Credit union actions: Ensure your products, services and marketing materials are culturally relevant and language appropriate for Hispanic members.
Use of Mobile
Credit union actions: When planning your mobile banking and payments strategies, recognize Hispanic females as a key audience. Consider holding focus groups or other forums for getting feedback from a cross-section of members. When possible, incorporate video into your Hispanic-focused communications strategy.Leave a comment
Over the next few months, we will write on a series of financial inclusion topics as they relate to the Hispanic culture. This first one focuses on an aversion to debt that exists within many segments of the Hispanic population. It also offers ideas for credit unions on how to provide education and value in this area.
Although there’s no one right answer to this question, it’s important to remember conventional banking as we know it in the U.S. may not be part of the traditional Hispanic upbringing. As Glenn Llopis, founder of the Center for Hispanic Leadership, wrote in a HuffPost blog post, “This has led to a general mistrust of banks and, when coupled with a natural skepticism, would account for the $53 billion attributed to ‘unbanked’ Latino households (according to a research arm of the University of Virginia’s Darden School of Business).”
We see the effects of debt aversion in higher education, as well. According to Hilda Hernandez-Gravelle, senior research fellow for the Institute for College Access & Success, several cultural factors contribute to the difficulty Hispanic students often experience when it comes to securing financial aid for college. These include fear of debt, mistrust of lenders and conflict between family obligations and educational aspirations. “While Latinos generally have a strong commitment to education, many believe that if you can’t afford to pay for it up front, you can’t attend,” Hernandez-Gravelle writes.
How can credit unions help?
Avoid a one-size-fits-all approach to financial education.
It’s important to remember different cultures and financial classes have different perspectives on money and financial services providers. For example, as psychologist Miquela Rivera, PH.D., points out, for first-generation, low-income Hispanics, accumulation of money might be, at first, the main goal. Later, they may realize money in itself is not a satisfier, but that satisfaction comes from doing what they want in life, without excessive financial worry.
“Latino students who are financially literate must view money as a means, tool or resource for getting things done, not an end in itself,” Rivera writes. When credit unions help their Hispanic members achieve this mindset, those members begin to see more clearly the importance of establishing credit and that debt, when managed responsibly, can actually be beneficial.
Focus on cultural needs vs. language barriers.
Rather than focusing on literacy and word-for-word translations, Principal’s Hispanic Market Program focuses on context and cultural needs to engage Hispanics in retirement savings. The program promotes a “transcreate vs. translate” ideology, focusing on context in written educational materials rather than the word-for-word translation. Also built in is incorporating simplicity in presentations and correcting misinformation, such as the kind that leads to distrust in financial institutions.
Credit unions should take a similar approach to educating Hispanic members and prospective members about debt and creditworthiness.
Build trust and credibility.
Llopis recommends offering culturally relevant and language-appropriate products and services backed by bilingual staff. He adds it’s also important to show genuine concern for the community – for example, by active involvement in Hispanic issues and sponsorship of local events. The community will be more likely to trust the education a credit union offers if it’s playing an active role in the betterment of their daily lives.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
Hispanic consumers are significantly more likely to be mobile banking users – and significantly more likely to stay members because of it.
Walk down any street in your community, and it isn’t hard to find evidence that Americans are using their smartphones to manage more aspects of their lives. Their financial lives are certainly no exception, and community banking leaders are taking notice.
According to a 2016 survey of financial institution leaders, their number one priority for 2017 was enhancing the digital and mobile experience. That’s what consumers are looking for as well. An earlier study from Bain & Company showed consumers are one-third more likely to enjoy a mobile transaction than a branch visit. What’s more, those surveyed anticipated a branch visit was 2.3 times more likely to end with annoyance.
Mobile banking is clearly the way consumers are headed when it comes to meeting their financial needs. Yet the adoption of mobile financial services isn’t the same across all the demographic groups that make up your member base. Notably, Hispanic consumers are significantly more likely than other groups to use mobile banking technology.
The Federal Reserve found in a 2015 study 82 percent of Hispanic consumers own a smartphone (compared to 74 percent of non-Hispanic white consumers). In addition, the study revealed Hispanic consumers with smartphones are more likely to be “high-intensity” mobile banking users – consumers who conduct mobile banking tasks more than 10 times a month.
According to the Federal Reserve’s report, “High-intensity users include greater shares of younger and Hispanic mobile banking users, relative to all mobile banking users.” These users are transferring money between their own accounts, making bill payments through an app, receiving alerts about their accounts, locating ATMs – all the things that highly-engaged and connected credit union members do. That could easily translate to high levels of loyalty to their cooperative.
If credit unions aren’t ready to appear in app stores now, there are plenty of other players on the financial services sector that are already there. Uulala, a fintech mobile app developed by Hispanic entrepreneurs specifically to serve unbanked Hispanic adults in the United States, is positioning itself as a way for Hispanic consumers to send money, build credit and make purchases – all without a traditional banking relationship. Uulala is launching later this year, and joins an increasingly crowded field of fintech developers looking to connect with a growing market hungry for digital banking options.
When it comes to maintaining strong connections with your members, you know you can’t ignore their increasingly digital preferences. By creating and enhancing an app that connects with Hispanic consumers, you may find your credit union enjoying longer relationships with this increasingly influential segment.Leave a comment
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
David Suarez, bilingual community development manager at Iowa’s Community 1st Credit Union, says insists the key to building connections with Hispanic members is trust. “We have to gain that trust in the community,” he said. “We conduct outreach with community leaders, schools – even soccer teams – so we can show them we are offering not only services, but education. Typically, they are very interested to learn, but it’s important to know they may not have the basic knowledge of financial concepts. You have to get close to them to understand their particular point of view and their particular issue. Only then can you begin to develop the clear, simple messages you need to start them down the path to financial success in the U.S.”
Among the connections Suarez and the Community 1st leadership has built is a partnership with the Mexican Consulate of Omaha, Guadalupe Sanchez Salazar. Shortly after building a relationship with Sanchez Salazar, the credit union signed an agreement to collaborate for the benefit of Mexican nationals that live in Iowa. As part of that agreement, any Community 1st member with a matricula consular card and Individual Taxpayer Identification Number (ITIN) has access to nearly all of the credit union’s products and services, including mortgages. This will be hugely important to the credit union as it looks to serve more Mexican immigrants, which today make up 75 percent of Iowa’s immigrant population. Suarez pointed out the credit union is also working with the IRS to help more of its community members obtain ITINs. “We’re excited to help the community understand that with this number comes great advantages, such as checking accounts, loans and potentially even a mortgage.”
In addition, the credit union is working with Iowa State University’s Extension and Outreach agency, which connects Iowans with the university’s research and resources. The agency is helping the credit union understand the education levels of the Hispanic community members local to the 15 communities PFCU serves through 17 locations in Iowa and northern Missouri.
CU Achieves Juntos Avanzamos Designation
In 2016, the credit union was given the Juntos Avanzamos designation, which translates to “Together, we advance. Awarded by the National Federation of Community Development Credit Unions and Coopera, the designation is a national recognition of the work and commitment made to offer financial services to the Hispanic community. The designation also makes a public proclamation to the Hispanic community that the Juntos Avanzamos credit union welcomes the Hispanic community.
On the strategic roadmap for Community 1st is continuous employee training and cross-department education so every staff member is aware they can accept alternative forms of identification to serve more community members. In addition, the credit union will conduct more community outreach, pursue a community development financial institution (CDFI) designation and institute a series of financial education programs in the coming year.
To read how Community 1st has helped one very appreciative member achieve his American dream, download “Hispanic Member Growth Not Just for ‘Gateway States’ Anymore.”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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