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River City credit union helps immigrants open bank accounts [1]

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Date: 2023-09-07 19:37:07+00:00

River City Credit Union CEO Jeff Ivey says his competition isn’t other banks or even credit unions. It’s predatory lenders.

Also known as payday lenders, they cash paychecks and offer loans at rates that can exceed 500%, often employing abusive practices that can their trap customers in rising cycles of debt.

River City Federal Credit Union is a CDFI, or community development financial institution, a federal certification that means its mandate is to provide financial services in low-income communities and to people who lack access to financing — the very ones most likely to turn to payday lenders.

Immigrants are especially vulnerable to these lenders, Ivey said.

“Number one, they’re everywhere,” Ivey said, and because many immigrants aren’t familiar with the U.S. financial system, they may see payday lenders as their only option to send remittances home, cash checks and pay bills.

Community organizations can play a strong role in helping connect immigrants with legitimate financial institutions, according to the report. For River City, that has meant collaborating with the YWCA and Family Service to raise awareness among low income and immigrant communities about the financial products and services available to them.

Last month, River City expanded its efforts, signing an agreement with the Mexican Consulate to help get the word out among Mexican immigrants that they may legally bank here in the U.S. — and that doing so can help them do what so many who come here say they want: to live the American dream.

The memorandum of understanding signed between the credit union and the consulate includes three prongs: a focus on financial education that will include acceptable forms of identification, financial education at the consulate and community outreach to raise awareness about resources that can help immigrants make informed decisions about their finances.

While this partnership focuses on Mexican immigrants, Ivey emphasized that the credit union works to raise awareness among all the immigrant communities in San Antonio that they can and should become part of the U.S. financial system.

“The immigrant community is very important to San Antonio,” he said, “and as it continues to grow, we think it’s our place to do all we can to help people coming to our country to help get them set up and acclimated to how things work.”

Any immigrant with the right identification can set up a basic savings or checking account, and that includes IDs from the immigrant’s home country, no matter their legal status in this country.

Those who have an individual taxpayer identification number, or ITIN, may also take advantage of loan products. River City even offers a loan to defray the costs associated with becoming a citizen.

The YWCA has had a partnership with the Mexican Consulate since 2008, said CEO Francesca Rattray, providing onsite financial education that includes how to get banked, access to free tax preparation, establishing credit and building a solid financial foundation.

Rattray said immigrants often lack basic information about how the banking system works and wrongly fear that if they are undocumented, opening a bank account will make them targets for deportation.

“We’re always looking for ways to partner with local banks and credit unions to expand services to newcomers in our community,” she said, which is how the YWCA began working with River City. “We share a commitment to keeping those newcomers [and] low income individuals away from predatory banking practices.”

The same is true for Family Service, one of San Antonio’s oldest human services nonprofits. Its financial empowerment center offers one-on-one counseling with certified financial planners for low and middle income residents, including immigrants, said Kim Arispe, who developed the program in partnership with the City of San Antonio.

“The truth is, financial literacy programs don’t really work, because they’re not contextual. People’s finances are very personal — and when they get one-on-one counseling, they get great outcomes: increased credit scores, decreased debt and the ability to build wealth.”

At Family Service Neighborhood Place on the city’s West Side, residents can take advantage of a range of services, including help with employment, child care, education and mental health counseling. River City has a branch onsite as well.

That’s where Ramon Cardoza, 64, opened a bank account three months ago. The credit union gave him $10 to open an account “when I didn’t have a penny in the world,” he said. He is not an immigrant — he was born in San Antonio and grew up near the Little Flower Basilica — but he is representative of the populations River City and Family Service aim to help.

The Neighborhood Place helped Cardoza find a job, and his paychecks are direct-deposited. He has a savings account for the first time in his life. He showed off the app that allows him to bank from his phone. “They’re helping me establish credit, which is good. I’ve never had credit in my life.”

Offering financial services and access to capital to low income and underserved members of the community “is a core part of our business,” said Ivey, and the immigrant community is part of that.

“If you’re brave enough to come to this country in search of a better life, and you don’t speak the language, and maybe you’ve got no family or friends here, we’ve got to help,” he said. “People should be given the opportunity to succeed.”

This article has been updated to clarify that River City Federal Credit Union will provide financial education at the Mexican Consulate rather than operate a branch there.

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[1] Url: https://sanantonioreport.org/river-city-credit-union-mexican-consulate-immigrants-banking/

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