Desert Schools Credit Union is preparing to market savings accounts to those without a social security number.
CU officials say the potential reward, thousands of new members, justifies the risk of angering a few customers and regulatory violations. Ignoring the state's fastest-growing population could be the equivalent of corporate suicide, one business expert said.
Desert Schools officials say that the interest-bearing immigrant-savings accounts, which require account holders to sign paperwork acknowledging that they're in the country temporarily, have been available for years. Only now has the CU decided to publically promote the accounts as a safe place for immigrants to deposit money.
Emma Garcia, Desert Schools director of community development, said the credit union's savings account program provides a public service, but it is aware of the potential for backlash. "We know that some of our members will have issue with it," Garcia said. "We think we're doing what's best for the entire community. We think its best for all our members that we do not have large amounts of cash out there. It's not going to in any way impact whether they decide to stay (in the country) or not."
That's not even the biggest hurdle Desert Schools has to clear when making inroads into the immigrant community. As a financial services provider, the credit union has to bridge a fundamental trust gap between a large entity and a population that inherently distrusts such companies, said Ruben Ramos, director of public affairs
with Arvizu Advertising and Promotions.
"In many cases, those new immigrants have a distrust about these financial institutions. You've got to overcome this barrier of how do you even get them in the credit union or into the bank," Ramos said. "There's no such thing (in Mexico) as FDIC insurance or deposit insurance. . . . There's this misunderstanding or fear of the institution of the bank."
Ramos, a former chairman of the Arizona Hispanic Chamber of Commerce, worked with Bank One before joining the Phoenix-based marketing firm last summer and said bilingual employees and administrators are the first step in bridging that gap.
"Fundamentally, I don't see anything negative that might be associated with what the credit union is trying to do, if people have a broader context about what the alternatives are for this segment of the population."
Ramos noted the abundance of check-cashing and high-interest loan stores that exist in areas with heavy immigrant populations.
"Those alternatives don't serve our community well," he said.
The accounts have existed for years, but the credit union is stepping up the marketing.
"We think it's a benefit for people to have them in accounts instead of at home, or in their cars," said Garcia.
The credit union offers reassurances that account holders will still have access to the funds, even if they're deported, Garcia said, a fear that with the passage of legislation like Proposition 200
is becoming more prevalent within the Hispanic community.
"They're afraid that that institution will partner with the Department of Homeland Security and report to them who's in an undocumented situation or not," Garcia said. "We're not going to be required to notify an agency if we find out they're undocumented. We're not required by law to do that."
Source:
http://www.azcentral.com/news/articles/0130mr-creditunion0131.html
