CU Values Fit Well With Hispanic Community Traditions

A genuine desire to serve and improve the lot of Hispanic immigrants while treating them with dignity and respect must be among the core values of any CU working with Hispanics.

BY 2020, HISPANICS will make up one-fifth of the U.S. population, according to census projections. Already at 13.3%, they're the largest minority. Yet most Hispanics have no relationship with a financial institution.

"Credit Unions Serving Hispanics: A National Perspective," a resource guide from the Credit Union National Association (CUNA), reports that 88% of Hispanics wish financial institutions would offer more services with their interests in mind.1 It's a huge opportunity for credit unions, says Robert Bruns, president/CEO of Charlotte (N.C.) Metro Credit Union, $123 million in assets.

Bruns, whose credit union sought a community charter three years ago primarily to serve the growing Hispanic population, sheds some light on why Hispanics don't use financial institutions. In Charlotte, a high percentage of crime victims are Hispanics who regularly cash their paychecks rather than putting those checks in a financial institution. It became known among thieves and con artists that many Hispanics don't trust financial institutions because of bad experiences with banks in their home countries.

"So we started working at the grassroots level to establish trust in our credit union among Latinos," Bruns says.

Indeed, trust is by far the most important factor, says Armando Cavazos, chair of CUNA's Hispanic Advisory Task Force and CEO of Credit Union One in Ferndale, Mich., with $720 million in assets. What Hispanic immigrants need most from financial institutions can be stated in one word: "Genuineness," says Cavazos. "These people don't appreciate a patronizing attitude. They can see through any efforts to grow our numbers by 'going after their business."'

A genuine desire to serve and improve the lot of Hispanic immigrants while treating them with dignity and respect must be among the core values of any credit union working with Hispanics, Cavazos says. It may sound simple, but there's more to it.

Become part of the community

"It takes time to build trust," says Cavazos, and Bruns agrees. Effectively serving Hispanics isn't something you can do on the fly, Bruns adds. And you have to commit plenty of time and resources to it.

Take $682 million asset USE Credit Union in San Diego. Its Chula Vista branch, one of nine offices, is located in the heart of the Hispanic community of San Diego, according to CEO Linda Baughman.

Serving Hispanics has been part of the USE culture for more than 50 years. Therefore, managers knew they needed to take a strategic approach to establish the Chula Vista office two years ago. They first targeted and hired a manager who lived and worked in that community. Two months before the branch opened, the manager went into the community to find and develop staff.

"We weren't 'reaching out' to the community as much as we were continuing our way of doing business," Baughman notes.

That way of doing business means making each branch an integral part of its community. Managers and staff at Chula Vista work with community groups, churches, and the local community college to learn of Hispanics' needs and provide tailored services. As a result, the branch opens later in the morning and closes later in the evening than other branches, reflecting members' work schedules.

Children often arrive with parents, who may not be able to find and afford babysitters, and they're welcomed. The branch has significantly more staff to allow members more time with service representatives. This helps accommodate members' often-intensive need for guidance in transactions such as getting a car loan. And every staff member at the Chula Vista branch is bilingual.

As Baughman describes it, the community-based approach helps the credit union to grow its membership. The Chula Vista branch devotes greater resources promoting partnerships with community groups and more time and energy getting referrals than it spends on traditional media advertising. It holds contests for bringing in new members, and winners receive baskets of prizes or vacation packages.

The strategy works. The branch is just two years old and has exceeded projections for loans, deposits, and new members.

Charlotte Metro took a similar path toward developing services for its Hispanic members, says Bruns. Management hired bilingual staff, advertised in Hispanic newspapers, and listened closely to learn of prospective members' needs.

For example, to address the issue of crime and to inspire trust in the credit union, Charlotte Metro offered Safe Accounts, which don't pay dividends but also don't require Social security numbers or large cash balances. Because many Hispanics wire money regularly to family members in their home countries, the credit union provided overseas wire services.

As a result, Charlotte Metro's Hispanic membership is growing steadily. Hispanic members are, on average, excellent credit risks. "We've found these new members have a highly positive effect on our credit union," Bruns says.

Credit Union One is integral to the communities it serves, including southwest Detroit, says Cavazos. It has served immigrants from all over the world for more than 40 years in the only area of Detroit where the population has grown steadily. While banks have come and gone, Credit Union One has remained there to serve people's needs.

Steeped in the area's culture, the credit union observes community traditions. Cavazos knows, for example, that churches form hubs in immigrant communities. He also knows that information often comes to families through their children attending school. So the credit union partners with those churches and schools to inform Hispanics about how to buy and maintain a house, and about other financial responsibilities.

Credit Union One assists area hospitals in providing information on health care for immigrants. It participates in Cinco de Mayo and other celebrations, sponsoring events and informing people about the benefits of membership. The credit union invested in a business development corporation that's building a new cultural center aimed at helping Hispanics find services and employment.

Again, says Cavazos, it all comes down to core values and purposes. "Our purpose is to affect society in a positive way by helping people meet their needs through cooperative means."

Financial success for the credit union will result, Cavazos adds. But that purpose and the underlying core values must drive the organization.

Getting started

If you're seeking to serve a new and growing Hispanic population, you may need some help. All three CEOs have given such assistance, and all offer words of wisdom.

"Have your credit union represented in community groups to find out from local people what their needs really are," Cavazos says. "seek to educate people and to provide those needs, but always respect their traditions."

Baughman strongly advises hiring directly from the community. "The best move we made was to hire a manager and staff from among those living there and working actively as civic leaders," she says.

Bruns never underestimates the importance of commitment. "To adequately serve Latinos, you must devote a lot of resources," he says. "If you think you can do it on a shoestring, don't try it. Take it seriously, but realize that it can be very rewarding."

1 A free, downloadable PDF of "Credit Unions Serving Hispanics: A National Perspective" is available at cuna.org. Click on "Serving the Hispanic Market" under "CUNA Initiatives."

Copyright Credit Union National Association, Inc. Nov 2004
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