University National Bank in St. Paul is courting customers from an unlikely place a Laundromat.
During this tax season, residents of downtown St. Paul can have their taxes prepared and filed while they do their laundry, and then cash refund loan checks at the University Bank branch a few blocks away.
Its kind of a hook to get them to come in and see us and see that we are not scary people and banks are not government organizations that take peoples money, said David Reiling, the president of $42 million-asset University National, which mainly serves a low-income clientele.
A handful of other banks targeting lower-end communities such as $1.2 billion-asset ShoreBank in Chicago and $43 million-asset City First Bank in Washington are trying to win accounts by offering tax-preparation services in branches. But it appears Universitys partnership is unique.
It works like this: An accountant in the Sel-Dale Laundromat prepares a customers taxes online for a small fee and then gets him or her a refund-anticipation loan through Bank One Corp. in Chicago. The taxpayer gets the check from the accountant a few days later, along with a flier, and is encouraged to cash the check at University Bank.
Why would these people go to University instead of a check-cashing outlet?
Three reasons, Mr. Reiling said: It is close to the Laundromat, charges less than check-cashing stores, and has the endorsement of an accountant.
University has been cashing checks for noncustomers since it bought a check casher six years ago to get new customers. Mr. Reiling said it will try to get the tax service users to open a no-minimum-balance account with their refund money.
The idea for the Laundromat service came about when the Laundromats owner, John Krebsbach, had space to rent out and went to Mr. Reiling, a longtime friend, for suggestions. After some brainstorming, they enlisted an accountant friend of Mr. Krebsbachs, Jim McNoltey.
Mr. Reiling said Wednesday that it was too early to tell how the partnership, which kicked off in mid-January, was doing. If it secures new accounts or gets people more familiar with University National, he will make room for an accountant at the bank next year, he said.
Doing it in the Laundromat is kind of a test case, he said. Its and off-site, nonthreatening place, and if we have success there we will definitely move it into the bank next year.
