Bridging Their Differences
Heritage Family Credit Union in Rutland has the technology.
Opportunities Credit Union in Burlington has the lending expertise.
Combined, they are seeking to become a more powerful force in reaching out to the state's low-income residents.
The National Federal of Community Development Credit Unions recognized that when it chose the team as one of seven across the nation to receive Bridge Grants of $25,000 to $100,000 for initiatives that meld mainstream credit unions with the specialized knowledge of typically smaller community development credit unions.
"To us, the exciting part, besides helping us with our stated goals, is the recognition that community development credit unions are getting as experts in lending and serving low income populations," said Caryl Stewart, CEO at the $36-million Opportunities Credit Union. "I think this will be a first in terms of mainstream credit unions consciously asking community development credit unions for help."
Matt Levandowski, VP of Marketing at Heritage Family Credit Union, said the partnership demonstrates how credit unions work together and pool resources to make the whole credit union movement better.
"This project is about two credit unions working together to bring better levels of service to both sets of members," he said. "You wouldn't see banks doing this."
The $114-million Heritage considers itself the "big brother in the technology field" for Opportunities, Levandowski said. "And they're our experts in how to help the underserved."
Levandowski said Heritage officials are having "fun picking their brains and learning as much as we can from them in this short time period." He said Heritage expected to utilize its new knowledge to reach out to more low-income members as well as students and first-time borrowers.
With their $100,000 grant, the duo prepared to expand their service areas to reach low-income residents through various means, including a full-service kiosk in an underserved area. Not only will this high-tech kiosk dispense cash, accept deposits, cash checks and provide e-banking services, it will operate an interactive video connection during normal office hours, connecting members with live staff at their respective credit unions through free telephone and video links.
"The new location is midway between the top and the bottom of the three counties where Heritage is located," Stewart said, careful not to call it a branch. "We are trying to experiment with this outreach method to see how we can reach more people."
Up & Running
She said the space has been obtained and the agreements have been signed, and the kiosk was up and running in May.
"It's going to be one of the most advanced ATMs on the market," he said. "It'll take checks without deposit envelopes and be a bulk note accepter without the need for deposit tickets," he said, explaining that one of the goals is to get Heritage's members comfortable with the latest in technology.
In addition, the two CUs will provide financial seminars, personalized counseling-based homeownership lending and flexible products including adjustable rates, Timely Payment Awards mortgages and Individual Developments Accounts that promote saving.
"We're in the long-term mode of bringing ourselves to a full-service level within an hour's drive for everyone in the state," Stewart said. "We're already statewide, but mostly through lending. What we'd like to do is bring the rest of our services out there."
Stewart said HFCU's techonological know-how is connecting Opportunities CU to other areas of the state with its ATMs, telephone lines and a desk for its community outreach staff member. HFCU's contributions and support of Opportunities (formerly Vermont Development CU) have been ongoing and exceeded the $100,000 grant, she said.
"They are going to give us access to the new, additional technology in a new space in Rutland City, expand our high-tech capabilities and help us launch our e-bank services," Stewart said. Rutland City is in the middle of the three-county area the Opportunities CU serves. In exchange, "We are bringing our expertise in low income lending to help them expand home ownership among their members."
The grants are for initiatives that will run through the end of the year. The Credit Union Executives Society will evaluate the progress independently.
Other Grant Winners
Other Bridge Grant recipients were:
* Bay FCU and Santa Cruz Community CU ($75,000)-These two CUs plan to extend their outreach and financial literacy education programs throughout the Pajaro Valley of California by replicating the successful model used by SCCCU to reach underserved populations.
* Community Educators CU ($50,000)- The CU will use this grant to open a new branch in Fellsmere County, Fla., that will serve the low-income and Hispanic populations there. To reach the residents, the CU will partner with Operation Hope, a non-profit organization that provides support to migrant farm workers and their families.
* OAS Staff FCU, IDB IIC FCU and District Government Employees FCU ($100,000) -These three CUs will create a CUSO and operate a shared branch that will also serve as an outlet for the Family Service Center, a shared-branch network in Maryland and Virginia. It will include bilingual staff and materials and will offer a comprehensive range of community development financial services.
* Patelco CU, Mission Area FCU and Northeast Community FCU ($100,000)-These three CUs will form the San Francisco Bridge/APPLE Consortium, and establish a CUSO to provide services to multi-lingual, multi-cultural members. The CUSO will open a satellite branch and two field offices in prime business areas of target markets.
* State Employees' CU (NC) and Latino Community CU ($25,000) -The money will be used to put together a written evaluation to document the processes and successes of LCCU, one of the fastest growing start-up CUs in the nation. In four years, LCCU has expanded to five branches and grown to over $18 million in assets with more than 27,000 members. SECU has provided the back office support and "inspirational mentoring," the applicants wrote.
* The Summit Federal Credit Union and Alternatives FCU ($50,000)-This project proposed to partner with the CASH Coalition in Rochester, N.Y., to provide an attractive and affordable alternative to high-cost "refund anticipation loans" offered at many commercial tax preparation vendors during tax season.