SAN FRANCISCO - The explosion of check cashers and payday lenders over the last two decades here have caused so much concern among local financial institutions that banks and credit unions have teamed up to encourage residents to put their paychecks and stipends into accounts at their institutions.
In fact, one credit union is going beyond the city’s generic advertising blitz “Bank on San Francisco,” by having members of its youth program take point in delivering the message to their peers.
The youth program of the Mission SF Community Financial Center, which is backed by the $8-million Mission SF FCU, has spent the summer persuading the city government to do more to help teens stay away from “predatory” institutions. Executive director Margaret Libby said that it has taken some time to raise awareness in the area because of the FCU’s size and low profile.
“The barrier is that there are so many check cashers in the neighborhoods where the highest numbers of families live,” she said. “They are on most street corners, so they are the easiest to access.”
While the CU has done its part to raise its profile by acquiring a new storefront office in a major commercial hub, the youth program has struck out on its own and brought in the city as a strong marketing resource. In June, several teens presented city officials and community organizations with the findings of a four-month study which showed that half of the youth they surveyed do not have any accounts at all despite the fact that many have jobs and are earning money,
Stephanie Lopez, the 17-year-old youth CU manager, stressed the importance of her peers getting their paychecks into accounts and “not get(ting) their money stolen by other places. They provide those services but they are not the best services that you can find.”
She also believes that the youth CU can use its unique position to better address the problem as the teens have a better rapport with their peers and are more likely to listen and ask questions about financial skills.
“Everything here is run by youth,” said Lopez, noting that they also participate in financial training and money management courses. “When a youth talks to another youth it is more at their level. With us we are able to interact in a fun and informative way.”
The city’s treasury office put the youth CU members in touch with the Bank on San Francisco marketing firm to develop billboards and bus advertisements.
Libby pointed out that most students who are going to check cashers make very little money, maybe $200 to 300 a month, and simply do not know the importance of putting their funds into accounts.
Why Issue Is Important
“These issues are really important; nobody knows how important these things are,” she said, adding that the youth program members are so passionate about saving because they grew up with strong financial education. “They understand the relationship between spending and community development. They understand the differences between these different financial institutions. They can see how many people are losing money.”
Lopez said that she is inspired by the accounts she oversees as many teens build wealth in the youth CU’s free savings accounts.
Though the city is now on board with the youth credit union’s ideas, breaking through to families will still be a difficult chore. Not only do payday lenders and check cashers outnumber credit unions and local banks, but heightened activity from Immigration and Customs Enforcement over the last year has made some in the area wary about opening accounts, said Libby.
Nevertheless, she remains optimistic that the legitimate financial institutions will win out in the Mission District.
“I would like to see every young person with an account and financial training before they leave high school so they have a sense how to balance a checkbook, how to have a financial goal and to know the savvy to understand which financial institutions are there to assist them and which ones are there to exploit them. I think it is something that is not taught anywhere in many communities,” Libby said.(c) 2008 The Credit Union Journal and SourceMedia, Inc. All Rights Reserved.http://www.cujournal.com http://www.sourcemedia.com
