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Check Cashing – Guadalupe Credit Union

Credit Union :Guadalupe Credit Union
Assets :$98
Address :3601 Mimbres Lane | Santa Fe, NM 87507
Start Date :2008

Check Cashing Qualifications :

No membership requirements; check cashing services are available to non-members and members

Payee(s) must be present and show government issued photo ID

Only approved payroll checks, government checks, or other checks as approved by management will be cashed

Address of payee and employment must be verified

Rates, Fees, and Terms :

1% of face value or $3, whichever is higher for non-members

No fee for credit union members

Vendors/Systems Used :

TranDotCom platform is used which records and retains the application information and completes compliance requirements

Target Market :

Non-members that may currently be using more expensive check cashers

Marketing Strategy :

A sign is posted in the window at the credit union’s Spanish –language branch where it is trying to attract potential members who may currently use more expensive check cashing methods

Word-of-mouth works very well

Program Results/Statistics :

As of October 2009, an average of 65 checks were being cashed per month for non-members

The majority of these checks cashed have occurred at the credit union’s Spanish-language branch and its branch located in an Albertsons’ grocery store

Member Benefits :

Non-members who use GCU are saving ½ the fees normally charged by check cashers, which are about 2% of the face value of the check

By joining the credit union, members can save 100% of the fees charged

Additional Information :

Originally, check cashing services for non-members was planned for the credit union’s new location, situated in a Hispanic, low-wealth community (See Emerging Markets/Reaching Immigrants). But check cashing services are now offered in all facilities. However, the bulk of the checks cashed for non-members occur at the Spanish-language branch and the branch located in Albertsons’ grocery store. While the credit union encourages these non-members to become members to avoid all check cashing fees, many choose to just cash their payroll checks at the credit union and are loyal customers because the fees are only 50% of those charged by check cashers.

Winona Nava, president and CEO of GCU, notes that offering check cashing services to potential members is a good way to grow new and loyal members. The credit union’s Spanish-language branch has experienced 124% growth in membership over 10 months during 2009. However, she notes, that if a branch already experiences high traffic, the addition of check cashing services for non-members could pose a strain on the branch, particularly on paydays. Whereas the TranDotCom platform simplifies the application and compliance requirements, verifying employment by calling the employer can be time-consuming. Still, Nava is very pleased with the membership growth results she has achieved in her new branch through her check cashing service.

Federally chartered credit unions can offer check cashing services to non-members that qualify for membership. Some states, such as New Mexico, offer parity to state chartered credit unions. State chartered credit unions should check their state regulations to determine if check cashing for non-members is allowed.

Additional Information :

Guadalupe CU has found that offering check cashing services to potential members is a good way to grow new and loyal members. The CU’s new Spanish-language branch has experienced 124% growth in membership during 2009.