//Home / Solutions / Emerging Markets / Reaching Immigrants

Hispanic Initiative - Guadalupe Credit Union

Credit Union :Guadalupe Credit Union
Assets :$98,000,000
Address :3601 Mimbres Lane | Santa Fe, NM 87507

Details :

Key Credit Union Data:

  • Loan/share ratio: 80.27%
  • Members: 14,388
  • Hispanic members:75%
  • Average shares/member: $8,403
  • SAFE Account average balance: $1,207
  • Average loans/member: $11,615
  • Number of Members using ITINs: 2,243 (15.5% of members)
  • Average shares/ITIN members: $3,326

Guadalupe Credit Union has 1,909 outstanding loans to ITIN members with an average balance per loan of $8,480. These loans are held by 1,173 ITIN members so the average loan balance for these members is $13,801. The total balance of these loans equals $16,188,663. These loans are for automobiles, mobile homes and some mortgages. Total deposits held by ITIN members equal $7,461,027. Total deposits held in SAFE accounts equal $481,734.

Background:

Santa Fe, New Mexico is tri-cultural: Indian, Hispanic, and Anglo. The membership at Guadalupe Credit Union is 75% Hispanic. At a strategic planning session in 2001, the board and management made the decision to reach out to its Hispanic immigrant community and provide needed products and services. “That turned out to be a major initiative that is still unfolding and helping us grow each year,” says Winona Nava, president and chief executive officer. To start the outreach process, two board members who spoke Spanish went out with staff on membership drives. A Spanish teacher came to train employees during staff meetings. Half of the 20 employees at the time attended a “Spanish for Banking” class at Santa Fe Community College. The credit union loan and human resource managers, along with Nava, attended a World Council-sponsored two-week immersion course in Mexico to learn the Spanish language and Mexican culture. They stayed with host families that were members of Mexican credit unions (cajas populares).

Today:

The credit union today has 61.7 FTE, 64 employees, of which 66% are bilingual. “We try to hire bi-cultural employees – employees who were born in Mexico or South America, but have lived here a number of years and speak Spanish and English fluently,” explains Nava.

In March 2008, Guadalupe CU added a fourth branch location, this one situated in a strip mall within an underserved Hispanic neighborhood. The branch was made possible through a grant from the National Credit Union Foundation’s Community Investment Fund.

This Spanish-language branch, which moved in 2012 from the strip mall to a free standing building across the street, serves approximately 4,798 new members and has a large open lobby to provide a family-friendly atmosphere. It also features an Education Room where financial education seminars are provided to the community. “These financial education seminars are extremely popular,” Nava states. “While there is no immediate return for our investment, our board takes a long-term approach towards our outreach efforts. We are building a presence and making an impact within the Hispanic community.”

The branch is located across the street from a public school that offers programs for children and parents who need assistance. Many of the children in the area are under-housed, which can mean multiple families living within a single family dwelling. One evening a week, the school program offers parents and children a free hot meal and food to take home. The credit union helps sponsor some of these meals. In addition, the credit union provides financial literacy classes in the school and at a nearby high school.

Services Offered:

  • Alternative forms of identification including the Matricula Consular card
  • SAFE accounts – non-interest bearing share accounts for those members without social security numbers or ITINs (Individual Tax Identification Numbers)
  • ITIN loans
  • International Remittances through Viamericas Money Transfer for $10/$1000 (members) and $15/$1000 (non-members)
  • SMART CASH payday loan alternative product for members
  • Volunteer Income Tax Assistance (VITA) services for low- to moderate-income families
  • Longer branch hours at the Spanish-language branch from 10 am to 7 pm, M-F and Saturdays
  • Classes and funding for micro-business loans up to $1,000 and through referral program for larger business loans to ACCION
  • Budget and credit counseling with a full-time financial counselor on staff
  • Share secured Visa loans; members must maintain shares equal to 125% of their credit limits, such as $1,250 deposit for a $1,000 credit line to manage over-limit charges
  • Credit-builder loans for as little as $300 for 10 months at rates up to 21%

Marketing Strategies:

The credit union partners with an immigrant rights group called Somos un Pueblos Unidos, or “We are a united community”. The credit union has provided financial tips for a local Spanish newspaper, but the newspaper dropped that section as a cost-cutting measure. The credit union partners with English as a Second Language (ESL) and offers financial literacy classes as part of the curriculum.

“Word-of-mouth remains our best marketing strategy,” says Nava. “The Hispanic community is very close and when people feel accepted and comfortable doing their financial business with us, they tell their family and friends about us.”

Measures of Success:

Since opening this office in March of 2008, the credit union’s Spanish-language branch has experienced tremendous growth. In 2013,
  • Membership reached its current level of 4,798
  • Deposits now total $2.8 million
  • 1,261 loans have been originated
  • Loan balances have reached $13.8 million

The branch’s delinquency ratio of 1.47% is below the overall delinquency ratio for credit union which is 2.9%. As a CDFI, Guadalupe Credit Union makes a higher percentage of high risk loans which attributes to have a higher than average delinquency ratio. Charge-off ratios have averaged 80 basis points for the past 3 years.

For the first 8 months of 2013, Guadalupe Credit Union has had annualized membership growth of 10%, asset growth of 6.48%, and loan growth of 3.26%. “The growth ratios speak to the success of our outreach efforts,” concludes Nava. “The immigrant market provides credit unions with ample opportunity for growth and for building partnerships and presence within these communities.”

In 2008, at the time the credit union secured the National Credit Union Foundation’s Community Investment Fund grant, over half of the credit union’s loans were to low income households (53%); today that percentage has risen to 65%. Demonstrating a continued commitment to their outreach mission, the credit union recently completed a test for CDFI Recertification helping them secure another CDFI grant for $597,000 to move their outreach efforts forward.