Are "Hispanic" and "low-income" synonymous?
No, stressed a number of people addressing a Partnering And Leadership Successes (PALS) workshop initiated by NCUA Board Member Debbie Matz here.
"The misconception that the Hispanic market is a low-income, low-balance market is false," declared Harriet May, CEO of Governmental Employees Credit Union of El Paso, Texas. Latinos are approaching $600 billion in purchasing power, said May, who noted that despite that only half have relationships with formal financial institutions.
Co-hosted by the North Carolina, South Carolina, Georgia and Alabama credit union leagues, approximately 150 people were in attendance.
"The Latino population in the U.S. is growing nearly four times faster than the general population," Matz pointed out. "Over the past two years, the Latino population has grown nearly 10% to 40 million-making Latinos the largest and fastest-growing minority group in America."
Panelists at the workshop emphasized that first, U.S. credit unions must overcome Latinos' distrust of financial institutions. Even in their home countries, up to 80% of Latinos don't have bank accounts. Several panelists suggested that U.S. credit unions connect through institutions that Latinos already trust-such as Latino community centers or churches.
To help more Latinos get in your credit union's doors, accept Matricula Consular and other foreign government cards as valid IDs, encouraged Deb McLean, VP-marketing at Charlotte Metro Credit Union. NCUA General Counsel Bob Fenner invited credit unions to send comments by July 25 on the PATRIOT Act rule that allows Matricula Consular cards to open accounts, with no photocopies required for future transactions.
Once inside your credit union, connecting with Latinos is "not only about language, but about culture," pointed out Luis Pastor, CEO of Latino Community Credit Union in Durham. Credit unions can't just hire a person who learned Spanish in high school. "To truly earn Latinos' trust," Pastor said, "hire Spanish-speaking immigrants from Latin American countries. You need employees who can directly relate to Latino members' culture and experiences."
"A great way to attract Latinos to the credit union and keep them there is income tax preparation," added Pablo DeFilippi, CEO of Lower East Side People's FCU in New York City. By helping eligible taxpayers file for Earned Income Tax Credits, credit unions help Latinos get tax refunds that can be used to open share accounts.
Panelists described many creative services- including the International Remittance Network (IRnet), Individual Development Accounts (IDAs), share-secured loans, and tiered-rate loans where rates are reduced as members repay.
Marketing your services to Latinos requires the skills of a trained translator, noted Nicki Amos, senior vice president of Founders Federal Credit Union in Lancaster, S.C. For example, two English marketing phrases translated literally into Spanish would mean, "We sell old tires" or "Relax, we have all your money!" Amos showed examples of successful credit union marketing materials designed specifically for Latinos.
Latinos are receptive to target marketing, confirmed Carmen Tapanes, assistant vice president of Eastern Financial Florida Credit Union in Miramar, Fla. She noted that "Latinos receive less direct marketing than any other group in the U.S., but are more likely to respond."
"If your credit union is not ready to reach out to the Latino community on its own, consider partnering with other credit unions," suggested Carla Decker, president of District Government Employees Federal Credit Union in Washington, D.C. Her credit union is planning a shared branch and other services for Latinos through a CUSO with two larger credit unions.
In branches, it helps to provide extra seating and activities for children.
"Whether traveling three blocks or 300 miles, Latinos bring their families," related Maurice Calderon, senior vice president of Arrowhead Credit Union in San Bernardino, Calif. Bilingual employees in casual dress also make members feel more comfortable, explained Miguel Avila, CEO of Chicanos Por La Causa Federal Credit Union in Phoenix.
Matz said that PALS workshops are designed to help credit unions share successful initiatives to improve services and attract new members. The next PALS workshop, Oct. 16 in Washington, D.C., will focus on small business owners.