Regional Conferences on Reaching the Unbanked 1

FINANCIAL LITERACY AND EDUCATION COMMISSION 

Regional Conferences on Reaching Unbanked People 

Summary 

Background 

The Financial Literacy and Education Commission, a partnership of 20 federal agencies, 

maintains the "MyMoney.gov" website and 1-888-MYMONEY toll-free hotline that provide 

access to a wide variety of publications and tools that can assist consumers better understand 

their money - how to save it, invest it, and manage it wisely to meet important personal goals. In 

April 2006, FLEC published Taking Ownership of the Future: The National Strategy for 

Financial Literacy. This national strategy assesses the current state of financial education efforts 

and outlines a plan to improve financial literacy across the country. 

Chapter 8 of the National Strategy focuses on the unbanked, pointing out that more than 10 

million individuals are unbanked and many more have accounts, but also use alternative financial 

service providers. The chapter describes using existing financial institution products to increase 

use and understanding, for example by providing remittance services, which can attract 

unbanked immigrants. The National Strategy also describes outreach and savings programs, and 

encouraging collaboration to increase knowledge about the financial system. The Call to Action 

in Chapter 8 states that: 

“the Department of Treasury, along with the Federal Deposit Insurance 

Corporation, the National Credit Union Administration, and the Office of the 

Comptroller of the Currency will host a series of regional conferences to share 

best practices on banking of the unbanked. The conferences will bring together 

community-based organizations, financial service providers, and Federal, state 

and local regulators to broker partnerships and discuss the latest developments 

and strategies in brining people into the financial mainstream.” 

Therefore, between May 2006 and October, 2007, the agencies hosted a series of four regional 

conferences in the Midwest (Chicago, IL), Southwest (Edinburg, TX), Northwest (Seattle, WA), 

and East (New York, NY). This document summarizes the proceedings of those conferences. 

I. Midwest Regional Conference, Chicago, Illinois

On May 1, 2006, As part of Taking Ownership of the Future: The National Strategy for 

Financial Literacy and Chicago Money Smart Week 2006, the US Department of the Treasury, 

the Federal Deposit Insurance Corporation, the National Credit Union Administration, the Office 

of the Comptroller of the Currency, and the Federal Reserve Bank of Chicago held the Midwest 

Regional Conference on Reaching Unbanked People at the Federal Reserve Bank of Chicago. 

With the theme of “Making Business Sense of Serving the Unbanked,” the conference 

highlighted banks and credit unions across the Midwest that are exploring ways to reach a new 
Regional Conferences on Reaching the Unbanked 2

market—unbanked customers. The conference also provided a forum for participating financial 

institutions, community organizations, and other interested individuals to share observations and 

ideas with the convening agencies and other practitioners.

Welcome and Introduction 

Dan Iannicola, Jr., Deputy Assistant Secretary for Financial Education, US Department of 

the Treasury discussed how access to an account can be “the on-ramp to the financial 

mainstream,” leading to things like asset accumulation, security and a better life, as opposed to 

not being in the financial mainstream, which is more or less a dead end of high fees, expensive 

borrowing, and no accumulation of wealth. Mr. Iannicola also described the financial education 

resources available at MyMoney.gov and 1-888 mymoney, resources produced by the Financial 

Literacy and Education Commission. 

Anna Escobedo Cabral, Treasurer of the United States, U. S. Department of the Treasury

described the importance of partnerships between the Federal government and the private sector 

in reaching the unbanked and described the National Strategy for Financial Literacy. She asked 

the audience to think about how we do a better job of truly reaching the unbanked, and thereby 

enabling and empowering people to truly participate fully in the economic mainstream of this 

country.

JoAnn Johnson, Chairman, National Credit Union Administration articulated the 

importance of trust in the delivery of financial education and serving the unbanked and described 

asset building opportunities for low-income people. She stated, “everyone across the spectrum 

can probably profit from a little financial education in one area or another.” Ms. Johnson also 

emphasized the delivery of service as being just as important as the financial education program 

content. She stated, “unless you get it to that person, it’s like sticking the book on the shelf.” 

Ms. Johnson acknowledged the cooperative spirit among bankers and credit unions to focus on 

financial education for both customers and members. 

Issue Overview 

Dory Rand, Supervisory Attorney, Sergeant Shriver National Center on Poverty Law 

(Chicago, IL) described the debt levels of Americans and the need for financial education as 

well as barriers to asset building. According to Ms. Rand, “nearly one in five American 

households owe more that it owns.” She stated, “it is not just that we live paycheck to paycheck, 

we spend more than we have. So, financial education, learning how to manage our resources 

more effectively, is critical. Not just for the unbanked, but for all Americans and all people who 

live here.” Ms. Rand further stated, “helping individuals develop financial skills should make it 

more possible for people to become small business owners, create jobs, and stimulate the 

economy.” Ms. Rand, lastly, described the Financial Links for Low Income People Coalition 

Pilot (FLLIP) in Illinois. 
Regional Conferences on Reaching the Unbanked 3

Panel Discussion and Questions 

Ed Jacob, Manager, Northside Community Federal Credit Union (Chicago, IL) 

described the need to provide appropriate financial products to the unbanked market, including 

payday alternative loans. In describing the need for short-term loans, Mr. Jacob stated, “by a far, 

far large percentage, these are not, people are taking out these loans, it is not a one time 

emergency.” He continued, “it's ongoing cash flow problems. ...not just living...week to week 

and paycheck to paycheck. They are living a week before paycheck to a week before paycheck.” 

Mr. Jacob shared an example of the credit union’s alternative product to payday loans: $500 at 

16.5% with 6 month-term, no minimum credit score, and used as an entry product. Mr. Jacob 

emphasized it was a way to get people into the credit union and begin working with them to 

improve their financial situation and help grow financially, rather than a profitable financial 

product. He noted, “You know, you can make money on these things between, somewhere 

between 16-and-a-half and 400. Because the payday lenders are making money at 400. I'm not 

at 16-and-a-half. So, you know, somewhere in that range, and I think it's closer to my number 

than their number, quite honestly, that this is a profitable product.” 

Mr. Jacob also described partnerships with employers as a way to deliver financial services. In 

addition, according to Mr. Jacob, historically credit unions were affiliated with employers. As 

key financial decisions are made in the workplace, such as health insurance, 401K plans, and 

cafeteria plans, it makes sense to provide financial education and services as well. Mr. Jacob 

provided overviews of partnerships with healthcare institutions, such as nursing homes and 

hospitals, with low-wage employees. The Earned Income Tax Credit with employees, provided 

free tax preparation (in partnership with the Center for Economic Progress), and basic financial 

education were provided at these sites. 

Margaret Henningsen Founder and Vice President, Legacy Bancorp (Milwaukee, WI) 

talked about her bank’s First Accounts program, combining high touch and high tech ways to 

bank the unbanked and described the start up of her institution to serve underserved markets. In 

discussing Legacy Bancorp, she said, “When you think something is wrong, you have to ask 

yourself the question what you are willing to do.” What she decided to do was start a bank to 

serve the low-income community. Today, the bank has $120 million in assets and approximately 

4,500 customers. It was chartered in July 1999 and is the first women-founded bank holding 

company in the country.

Ms. Henningsen discussed the bank’s partnerships with non-financial institutions to attract 

customers and provide financial education. In particular, Legacy Bancorp worked with childcare 

and welfare-to-work programs and provided training to both the childcare providers and their 

clients. The welfare-to-work program provided an audience of training participants who were 

required to participate. The bank then provided direct deposit access to their benefits. 

Regarding the First Accounts program, Legacy Bancorp carefully monitored the project, and was 

able to generate reports and identify when customers were in trouble. She provided one-on-one 

counseling to teach customers to avoid overdrafts. 
Regional Conferences on Reaching the Unbanked 4

Ms. Henningsen summarized her view on banking the unbanked as nothing new. She noted: 

“Banks have been banking the unbanked since they started. When they started on 

those little corners and immigrant communities, they were banking the unbanked. 

Because the people who came here and started this country didn't have bank 

accounts. They didn't have assets or wealth. They came here with nothing to start 

a new life and the banks started to bank the unbanked.” 

She explained that bankers should talk face to face with their customers and tell them what they 

must do to generate assets and build wealth. In Ms. Henningsen’s words, “Just do it the way you 

did it in the old days. “ 

David Marzahl, Executive Director, Center for Economic Progress (Chicago, IL) spoke 

regarding the opportunity for tax time to be used to promote financial literacy and financial 

planning. Specifically, Mr. Marzahl described the Extra Credit Savings Program partnership 

between the Center for Economic Progress and ShoreBank. Through this initiative, tax 

preparation services were offered in the bank’s lobby, and approximately 20% of clients opened 

accounts at the time of getting taxes done. The Center received a grant from the U.S. Department 

of the Treasury’s First Accounts Program to expand the Extra Credit Savings Program, opening 

1,500 accounts for individuals with a median income of $13,000. 

The Center’s tax assistance services overall brought back $193 million in refunds to the state of 

Illinois. According to Mr. Marzahl, these tax refunds ideally may be used as an asset building 

tool as well as a means for resolving debt and credit issues. The split refund offers opportunities 

to build assets; but administratively can be challenging. An emerging product of debit cards may 

be the next step toward getting people who cannot open accounts (due to ChexSystems) linked to 

the financial mainstream. 

James Maloney Chairman, Mitchell Bank (Milwaukee, WI) spoke from a community bank 

perspective about the need to identify what unbanked customers believe that they need, and 

focus on getting them into banks. He talked about providing a range of services, including a 

variety of remittance products. Mitchell Bank offers four types of remittance products in order 

to meet diverse customer needs and perceived needs, including: dual ATM cards, stored value 

cards, wire transfers and the Federal Reserve’s “Directo a Mexico” ACH product. “Because that 

is the only way you're going to have face time with the unbanked, is to allow them to know that 

you're offering a product that they want and that they need.” He noted: “The unbanked have 

financial providers. They are check cashing and alternative financial providers. And they don't 

think of banks as providers of the financial services that they need. So you need to change that.” 

Mr. Maloney also emphasized providing a welcoming environment in the bank. Mitchell Bank 

opened a Remittance Center within the bank and staffed it with knowledgeable people, and 

posted the exchange rate throughout the bank. Additionally, the bank participated in the Directo 

a Mexico pilot which allowed customers in the U.S. to open bank accounts in Mexico for the 

remittance recipient.
Regional Conferences on Reaching the Unbanked 5

Regulatory Update 

Bert Otto, Deputy Comptroller of the Currency, Office of the Comptroller of the Currency 

(OCC) described the importance and benefit to banks to serve the unbanked market, given that 

market is where there is most room for growth. He noted that “that banks that do not figure out 

how to serve these markets are not going to prosper.” He added, “I believe banks are uniquely 

positioned to provide options and opportunities for the unbanked. But doing those things 

requires both an understanding of the market and a commitment to design products and services 

that are consistent with the reasonable profit expectations, and responsive to what these 

customers want at competitive prices they can afford.” Mr. Otto’s final thought was that it is 

clearly not only a civic responsibility, but it is something that is good business. 

Working Groups 

Conference attendees broke into self-selected working groups to discuss a number of topics more 

deeply and work toward action steps. After the working group sessions, each group provided a 

summary of the discussion to the plenary session. 

(1) Serving Immigrant Communities. 

This working group discussed a number of strategies to serve recent immigrants. One item 

discussed was remittance products. The Federal Reserve ACH Directo a Mexico program was 

described as having the advantages of cost and efficiency, whereas the disadvantage being it only 

works if the recipient has a bank account in Mexico. The pilot described earlier by Mr. Maloney 

as a possible remedy for this challenge. Participants also discussed pre-loaded cards, but they 

may not be desired in all recipient countries, where recipients prefer dollars to the local currency. 

Participants also discussed the challenge of providing mortgages to immigrants using individual 

taxpayer identification numbers (ITINs) rather than Social Security Numbers. It was 

recommended that financial institutions obtain guidance from their regulators on this topic, as 

well as exploring the role financial institutions can play as acceptance agents for the Internal 

Revenue Service (IRS) regarding the issuance of ITINs. It was noted that obtaining ITINs for 

customers can encourage a loyal relationship among the institution and the customer base. This 

working group also touched on taxi medallion loans, franchise business loans, and Islamic 

financing. Finally, the working group referred financial institutions to the FDIC’s “New 

Alliance Task Force” and the Federal Reserve Banks as a resource. 

(2) Selling the Business Benefits of Serving the Unbanked within the Institution. 

Participants in this group discussed concerns from senior management that serving the unbanked 

or underbanked population will raise the institutions’ risk profile and draw unwanted attention 

from the regulators. The working group recommended that regulators establish guidance on safe 

areas in regards to ITINs and other identification issues. It was also recommended that financial 

institutions form partnerships with non-profit organizations as a means to reduce the cost. It was 

also noted that an effective strategy would be to gradually bring senior management into the 

market; demonstrate the benefits over time of a larger market. Participants also emphasized the 

need for quantitative data to show you can attract a certain number of new customers, the amount 

of money they bring to the bank and translate those numbers into profits. Also discussed were 

structuring incentive packages to provide compensation for pursuing the market and developing 
Regional Conferences on Reaching the Unbanked 6

a business plan with a series of steps showing how to achieve the outcome. Participants 

expressed that it was important not to place the efforts under the Community Reinvestment Act 

compliance, but instead incorporate this focus as a business type of activity. Finally, participants 

noted that they should be aware of cultural differences to establish effective approaches in 

various markets. 

(3) Developing New Products, Services, and Technologies 

Participants in this session discussed products and technology under the categories of consumer 

and financial institutional needs. They discussed the need to develop products for consumers 

that are low cost, have low balance requirements, and have convenient terms (such as hours, 

location, and ease of use). The working group identified the usefulness of focusing efforts on the 

Earned Income Tax Credit since it puts money into the consumers’ pockets. Also discussed were 

club accounts modeled after the old Christmas Club as accounts to save for home ownership, 

college, etc. The group highlighted challenges to financial institutions, including: staff deficient 

in product knowledge, multiple teller responsibilities, and staff turnover. The group emphasized 

the need to build bridges with consumers: find out what the consumer needs and connect them 

in a meaningful way and make consumers feel it is safe and comfortable to ask questions. 

(4) Youth Customers 

This working group discussed implementing financial education in grades Kindergarten through 

12, and structuring a savings component in it so children can save on a regular basis. The group 

also discussed using media, such as kid friendly books (comic books) to promote financial 

stability; removing barriers to saving for college so financial aid will not be restricted; and 

partnering with schools, youth organizations, faith based groups, and parents. Some 

recommendations for financial institutions included lowering the opening deposit and minimum 

balance requirements, providing prizes, moving youth into other products over time, and making 

youth feel comfortable in the financial institution (for example, providing a step stool). Debit 

cards, online access, internet, radio, television, cell phones, text messaging, and all kinds of 

interactive media could be used to reach out to young people as long as they are interactive and 

meet their needs. Developing a business plan for conducting outreach to youth was 

recommended. 

Closing Remarks 

Mr. Dan Iannicola, Jr. summarized lessons learned from the conference. One of his 

observations included that financial institutions can learn from the alternative financial services 

providers who effectively reach the unbanked market. Additionally, Mr. Iannicola noted, 

“banking the unbanked is not so much about dollars and cents as it is about thoughts and 

feelings. Finding people where they are, and helping them getting over their internal hurdles. 

Not dragging them to financial services, but bringing financial services to where they are. In 

their language. In their neighborhood. Wherever that may be.”. “Another thing that seems to 

come out is making it concrete for people. I'm not just saving for saving’s sake. I'm saving for a 

reason. For a house. For an education. For a business.” Mr. Iannicola noted that a number of 

effective strategies occurred at the workplace or school, at tax time, or other “teachable 

moments.”
Regional Conferences on Reaching the Unbanked 7

II. Southwest Regional Conference, Edinburg, Texas

On December 4, 2006, at the University of Texas - Pan American, in Edinburg, Texas, the 

second Regional Conference on Reaching Unbanked People was convened by the U.S. 

Department of the Treasury, the Federal Deposit Insurance Corporation, the National Credit 

Union Administration, and the Office of the Comptroller of the Currency, with the assistance of 

the Federal Reserve Bank of Dallas, the U.S. Department of Housing and Urban Development, 

and the Office of Thrift Supervision. 

The conference included discussion on unbanked people in border and immigrant communities, 

the role of financial institutions in financial literacy, the impact of being unbanked for 

individuals and communities, and a survey of Latino Earned Income Tax Credit filers in border 

communities. Following the conference, Federal agency representatives participated in a 

community financial education event sponsored by the Office of Congressman Ruben Hinojosa. 

Welcome Remarks 

George Bennack, Associate Director for Business Development, University of Texas - Pan 

American welcomed participants to the University, and briefly described the University and the 

community which it serves. He noted that the facility serves as a basis for the university’s 

outreach to the community, including providing financial literacy, homebuyer education, microenterprise training, and other business development training and technical assistance. 

Dan Iannicola, Jr., Deputy Assistant Secretary for Financial Education, U.S. Department 

of the Treasury summarized the reasons why it is important for people to become banked and 

part of the financial mainstream. “Being outside of the financial mainstream really puts people 

at a disadvantage. Having a bank account or a credit union membership, a relationship with a 

financial institution, is really the gateway for all other financial services and being able to 

integrate oneself in the economy.” 

Anna Escobedo Cabral, Treasurer of the United States, U.S. Department of the Treasury 

welcomed the group and stated the one thing learned in Washington DC is that the federal 

government is not able to touch the lives of each citizen in the way that community leaders do, 

particularly speaking of those in attendance, from the banking and community sectors, state and 

local government and non-profit organizations. She stressed the importance of establishing 

partnerships and a comprehensive approach to address the issues of the unbanked and 

underserved. 

JoAnn Johnson, Chairman, National Credit Union Administration expressed the importance 

of credit unions and banks working together providing financial education. She also emphasized 

it is not the amount of money that makes a person wealthy it is how they manage their money 

that makes the difference. Ms. Johnson encouraged the audience to explore the implementation 

of Individual Development Accounts (IDAs) and Volunteer Income Tax Assistance (VITA) 

means for asset development and avenues to deliver financial education. Ms. Johnson discussed 

the successful partnership between credit unions and the state of Wisconsin, in which the credit 

unions contribute to the tuition for teachers to attend a two week financial education program at 
Regional Conferences on Reaching the Unbanked 8

local universities, in turn, the teachers agree to incorporate financial education into their reading 

and mathematics curriculum, and they also receive continuing education credits. 

Greg Davis, Representative Ruben Hinojosa’s Office briefly spoke on the Fair and Accurate 

Credit Transactions Act. He highlighted the legislation’s significant outcomes as: the creation of 

the Financial Literacy and Education Commission, heightened the awareness of identity theft, 

and the right to obtain a free credit report annually. 

Michael Goeken, Project Manager, Department of Community Initiatives, City of San 

Antonio, Texas discussed the City of San Antonio’s asset-building and debt reduction efforts. 

He stated the program’s three objectives were: family strengthening, community development, 

and a human safety net. He identified the explosive growth of fringe financial services as the 

city’s biggest challenge. Mr. Goeken highlighted the city’s best practices for getting the 

unbanked/underbanked into the financial mainstream. These included: 

• The implementation of an ordinance that requires disclosure of refund anticipation loan 

terms and conditions. 

• The pilot project with the city of San Antonio, San Antonio City Employees Credit 

Union, and FirstMark Credit Union to put low-and moderate-income individuals into 

lower interest rate car loans. 

• Maximizing the use of Volunteer Income Tax Assistance (VITA) sites by surveying 

customers to determine needs and identify the unbanked. 

• Implementation of community family learning centers that offers free citizenship 

preparation classes and English as a second language. 

• The Ford Motor Company matched saving program; operates similar to an Individual 

Development Account (IDA) program. 

Barbara Robles, Associate Professor, School for Social Work and Center for Community 

Development, Arizona State University: Financial Needs and Financial Status of Border 

Families

Dr. Robles highlighted the contributions border-states make to the nation’s economy. Dr. Robles 

stated that 55% of all Latinos in the United States live in four border-states: Texas, California, 

New Mexico, and Arizona, and collectively these states contribute almost a quarter of the gross 

domestic product. She concluded since they are important contributors to the overall economy 

more emphasis should be placed on the needs of individuals residing in border-states. Dr. 

Robles additionally acknowledged the increase in micro-businesses and self-employment in 

border states. 

• Emphasized the role VITA sites and the EITC campaign play in bringing dollars back 

into border-states economy. 

• Articulated the impact and added value in coalition building and collaborations among 

private, public, and non-profit sectors will have on our field of work within the next ten 

years. 

• Commended attendees who have established collaboration with community-based 

organizations targeting the Latino market and identified those efforts as being trust 

builders for financial institutions. 
Regional Conferences on Reaching the Unbanked 9

• Informed financial institutions of the growing practice of communal form of extended 

family asset-building and encouraged them to begin exploring financial products to 

support it. 

• Concluded by emphasizing the need for financial service sectors, underwriters, and 

financial literacy components to meet “halfway” to develop innovative financial 

products. 

Financial Institution Panel 

Mr. David Lewis, Community Affairs Officer, Office of the Comptroller of the Currency 

(OCC) moderated this panel. He also encouraged participants to visit the OCC website to learn 

about the agency and use its many resources, including the Financial Literacy Resource 

Directory. He also pointed to the OCC subscription newsletter to keep current on banking, 

financial literacy, community reinvestment, and community development topics. Finally, Mr. 

Lewis referred participants to the OCC’s publication “Reaching Minority Markets,” published 

November 2006. 

Mr. Douglas Bready, President, Texas State Bank (Mc Allen, TX) stated that it is important 

that you know your market to serve it properly. He shared the many reasons immigrants do not 

have bank accounts, including new immigrants’ focus on basic survival needs (e.g. finding a 

place to live, making sure their immigration paperwork is correct, and finding a job); as well as 

some immigrants have never been exposed to banking systems and do not understand the 

benefits of banking, and how it can lead to asset building. He also stated that once you know 

your market you can begin strategizing your outreach. He emphasized it is important to 

remember that your exterior can prevent people from seeing your interior so you must reach your 

potential market at a level in which they understand and are comfortable. Mr. Bready pointed to 

payroll cards as a means to get the unbanked into the system. This effort requires a partnership 

between financial institutions and employers. He also pointed out that internet banking is an 

excellent outreach strategy for targeting youth since they are technologically savvy and use the 

internet as a method to communicate. 

Ms. Maria Martinez, President, Border Federal Credit Union (Del Rio, TX) described a 

number of financial literacy and outreach efforts of her credit union. They include a 

Homeownership Counseling Program which partnered with the local Air Force base to reach 

newcomers and educate them on homeownership opportunities in the area. She also described a 

Volunteer Income Tax Assistance (VITA) site implemented using grant funds to pay the salary 

of a full-time coordinator. The site provides the opportunity to do financial counseling and 

educating taxpayers on getting savings secured loans. Ms. Martinez described a number of youth 

initiatives, including a Youth Fair, Youth Financial Camp and coordinating with Junior 

Achievement. Ms. Martinez described the credit union’s “Border Buck” mascot which attends 

parades, career days, and youth fairs. 

Ms. Harriet May, President, GECU (El Paso, TX) described research that revealed how 

members paid bills, how they got involved with financial services, their culture, and identified 

members eligible to have a checking account but who were using money orders to pay their bills. 

She also described a new Savings Challenge Program designed to teach families how to save. 
Regional Conferences on Reaching the Unbanked 10

The results of this program will be shared through an advertising campaign. Ms. May 

highlighted the deposit products designed to promote savings, such as No Excuses Savers Club, 

certificates of deposit, and debit cards. She also pointed to positive results of marrying 

Individual Development Accounts program and the Earned Income Tax Credit for the use of a 

down payment to purchase an affordable house. 

Mr. David Guerra, President, International Bank of Commerce (McAllen, TX) discussed 

the effects of the bank’s expansion efforts, extended hours, and the outreach opportunities it 

presented. Particularly, he noted that having branches located in retailers (Wal-Mart, a local 

grocery chain and shopping malls), meant that they were reaching unbanked people where they 

were. He emphasized that his bank does not make a difference between a million dollar account 

and a thousand dollar account. He also noted: “what we have done in our company is to try to 

eliminate all these layers as to how we can get close to the unbanked. Now, we apply the same 

principles to the very strong businessmen, people who are highly educated, highly resourceful, 

they have all the assets in the world that make them easy to bank, but our position has always 

been get close to your customer, get to know your customer, and deliver products to him that are 

relevant to him.” Mr. Guerra also discussed loan products provided in the Hispanic community, 

particularly to small businesses. 

Resource Panel 

Mr. Eloy Villafranca, Community Affairs Officer, Federal Deposit Insurance Corporation 

(FDIC) moderated this panel. He also described the work of the FDIC in Texas, and the Texas 

New Alliance Task Force (NATF) which it coordinates. The task force will be re-named the 

Alliance for Economic Inclusion and will focus on providing products and financial education to 

unbanked and underbanked individuals across South Texas by bringing together resources such 

as the IRS, employers, and others. He also encouraged the group to think about the future and 

the importance of education to the future of Texas. 

Mr. Matt Davies, Senior Account Executive, Federal Reserve Bank of Dallas discussed the 

Federal Reserve Bank’s involvement with the development of a low-cost remittance product: 

Directo a Mexico (Direct to Mexico). It is an account-to-account transfer product which relies 

on the existing domestic automated clearing house (ACH) structure. Mr. Davies promoted the 

benefit of partnering with Bansefi which promotes saving, account holding, and financial literacy 

in Mexico. 

Ms. Nancy Granovsky, Professor and Extension Family Economics Specialist, Texas 

Cooperative Extension (College Station, TX) indicated that the focus of Cooperative Extension 

is to solve public needs with college or university resources through non-formal and non-credit 

programs. The Extension Service develops research-based educational programs, such as the 

“Wise Up” program. This is a financial planning program that focuses on women between the 

ages of 22 and 35. The Texas Cooperative Extension also offers a debtor education class in 

Spanish; partnered with the Texas Credit Union League to develop and implement a “Youth 

Financial Literacy” curriculum; collaborated with the Consumer Federation of America to 

promote America Saves; partnered with the Credit Union National Association and translated 
Regional Conferences on Reaching the Unbanked 11

their financial education curriculum “Thrive by Five” into Spanish; and established a national 

website entitled “Extension in Español”. 

Mr. David Hirschman, Supervisory Tax Specialist, Internal Revenue Service promoted the 

implementation of Volunteer Income Tax Assistance (VITA) sites and explained the IRS 

Stakeholder Partnership Education and Communication (SPEC) office, which can help convene 

community coalitions around providing assistance to low- and moderate-income taxpayers, as 

well as the elderly, people with limited English proficiency, and taxpayers with disabilities. The 

IRS provides the technical capacity, software, volunteer training, and expertise to make these 

sites successful. With these resources, individuals can obtain tax refunds that can significantly 

enhance their ability to build assets. Mr. Hirschman also promoted the Telephone Excise Tax 

Refund. Lastly, he emphasized that IRS staff are available as resources. 

Roundtable Discussions 

Conference attendees broke into self-selected roundtable sessions to discuss a number of topics 

more deeply and work toward action steps. After the working group sessions, each group 

provided a summary of the discussion to the plenary session. 

(1) Remittances and Reaching the Unbanked 

The group discussed various types of products available and how they are used, including 

Directo a Mexico and VIGO (used primarily by credit unions). The group also reviewed 

marketing strategies for banking the unbanked. The group identified what should be done to 

improve services, including: learn the unbanked system of doing things, understand where the 

unbanked customers are coming from, get familiar with the culture, and try to understand the 

way they think. Finally, this group discussed the importance of working with community groups 

to reach the unbanked, working with schools, and the role of a dedicated outreach person. 

(2) Innovative Products and Strategies for Reaching the Unbanked 

This discussion group raised a number of innovative strategies. These included how to get board 

members of the financial institution supportive of serving low- and moderate-income population. 

The approaches mentioned included using the Community Reinvestment Act report and the 

examination as an educational tool. The group also discussed the pros and cons of young people 

using debit card and payment cards. The working group raised the idea of repackaging existing 

products. An example shared was a “Money Savers Club”: the concept would be the same as a 

Christmas Club instead the member would be working toward asset-building and it would be a 

more productive use of their funds. Finally the group talked about the advantages of 

partnerships, such as sharing risk, sharing opportunity, and sharing resources. 

(3) Financial Education and Reaching the Unbanked 

The Financial Education working group discussed approaches used to identify opportunities to 

offer financial education. For example, the group discussed approaching teachers versus 

superintendents to reach the students in the school systems. This working group discussed the 

importance of government at all levels (local, state, and federal) to get involved and work 

together to offer financial education. The group discussed the importance of listening to the 
Regional Conferences on Reaching the Unbanked 12

community and building partnerships to offer financial education. The group agreed that through 

financial education we are creating a class of better borrowers, savers, customers and members. 

(4) Asset Building and Reaching the Unbanked 

The Asset Building working group discussed the definition of assets, using definitions including: 

something that adds value; something that adds to the ability of an individual to earn income; an 

income-producing object; and something that puts money in your pocket rather than taking it out. 

This working group identified education as an asset since it helps with making better financial 

choices. The group also identified “saving” as an asset (using the example of Individual 

Development Accounts coupled with EITC). This working group covered the benefits of payroll 

deduction, retirement savings, and health benefits as asset-builders. Additionally, Michael 

Goeken explained the Ford Motor Company asset-building program in San Antonio. 

Summary and Wrap-Up 

Mr. Iannicola summarized the conference. He noted, 

“It seems to me the trust is something that came through a lot of the conversations, both 

the small groups and the experts we heard from, the idea of familiarity that flows from 

that, be it cultural and whatnot, and having people in staff, the suggestion is have them be 

bilingual and understand cultural issues is important.” 

He also pointed out: “We want these folks to have some suspicion, we don’t want them to 

be taken advantage of, so we want their guard up, but we want it up not so high as to wall 

us out so they cannot get education information and open up to new things that are good 

for them while screening out the bad. So if we can strike that balance, I think we can be 

successful in reaching these folks, so trust is key.” 

Mr. Iannicola discussed partnerships, and working with school systems. He also advised, 

“when you can swim downstream, do it.” He noted that there are some steps that are 

easier and more natural – such as encouraging people to save for a tangible goal, rather 

than just to save. He also encouraged partnering with other opportunities, such as 

applying for insurance or filing taxes. 
Regional Conferences on Reaching the Unbanked 13

III. Northwest Regional Conference, Seattle, Washington

On March 27, 2007, in Seattle, Washington, the Department of the Treasury, the Federal Deposit 

Insurance Corporation (FDIC), National Credit Union Administration (NCUA), Office of the 

Comptroller of the Currency, Office of Thrift Supervision, and the Federal Reserve Bank of San 

Francisco with the assistance of the Department of Housing and Urban Development and the 

Washington State Department of Financial Institutions, held the Northwest Regional Conference 

on Reaching Unbanked People. 

The Western Regional Conference focused on illustrating some of the best practices 

implemented by the private sector for reaching and providing financial access to the unbanked. 

Key themes included discussions on the importance of partnerships, working with youth, 

working with immigrant populations, and identifying appropriate incentives and delivery 

strategies for banking the unbanked. 

Welcome and Conference Overview 

Mr. Dan Iannicola, Jr., Deputy Assistant Secretary for Financial Education, 

U.S. Department of the Treasury described the Financial Literacy and Education Commission 

and Treasury’s interest in reaching unbanked people, and Taking Ownership of the Future: the 

National Strategy for Financial Literacy. Mr. Iannicola also emphasized that the outcome are 

not just “dollars and cents but about hopes and dreams,” and helping people achieve stability and 

meeting their dreams not just getting by. 

Mr. Brad Williamson, Director of the Division of Banks, Washington State Department of 

Financial Institutions, spoke about the commitment of the Department of Financial Institutions, 

and the importance to bringing various parties together to address the issues of the unbanked. He 

described the variety of financial literacy tools used by his department to reach the diverse needs 

of the state’s residents, and pointed out that multiple solutions are needed, especially 

“innovation” by the institutions, to address the complex challenge of those who are unbanked. 

“What we really need is we need innovation because that's the great thing about capitalism and 

that's something that sometimes we in government don't fully appreciate...when I was in the 

banking community as a banker that I realized it's truly the institutions that provide the innovation. 

It's the groups working in the neighborhoods that provide the innovation”. 

Mr. John F. Carter, Regional Director, San Francisco Region, Federal Deposit Insurance 

Corporation (FDIC), presented statistics about the nation’s negative savings rate, and about the 

level of unbanked and underbanked individuals in the country. Because of rates charged by 

payday lenders it’s highly unlikely an individual will be able to amass any appreciable amount of 

savings when that is their financial outlet. “Financial institutions need to do a better job of getting 

that initial relationship going with those customers,” he advised. Mr. Carter also described some of 

the ways FDIC partners with private-sector entities and other federal agencies to reach unbanked 

customers and provide financial education resources. 
Regional Conferences on Reaching the Unbanked 14

Regional and Local Perspectives Panel

Ms. Janet Byrd, Executive Director, The Neighborhood Partnership Fund (Portland, OR) 

described state-level support for asset building initiatives in Oregon, including a state earned 

income tax credit and a statewide individual development account initiative funded by an 

individual income tax credit—initiatives which benefit rural and urban communities in the state. 

Ms. Loretta Moesta, Chief Executive Officer, OUR Federal Credit Union (Eugene, OR), 

described the steps her small credit union had taken to reach underserved consumers, including a 

survey and a study funded by the Treasury’s Community Development Financial Institutions 

Fund. She emphasized the small but meaningful steps taken to ensure that the culture of the 

financial institution was welcoming to low-income individuals. Ms. Moesta also urged 

participants to be equipped and prepared to serve the unbanked. She reflected: “if we were really 

going to reach the underserved, we needed to be open to change within our own organization. We 

needed to hire knowledgeable staff, people who understood low income or ethnicity problems. And 

if you're going to serve them, you need to be committed to serve them and remain committed.” 

Ms. Lena Robinson, Regional Manager for Community Development, Federal Reserve 

Bank of San Francisco (San Francisco, CA) described the Banking on San Francisco initiative, 

which is being coordinated by the local government, the Federal Reserve Bank, financial 

institutions, and others, to encourage provision of basic accounts to all of the city’s low-income 

unbanked residents. Participating financial institutions commit to certain account features, such 

as no minimum balance, and acceptance of the Mexican and Guatemalan Matricular cards as 

primary identification. 

Mr. Dave Sieminski, Manager, Asset Development Programs, United Way of King County 

(Seattle, WA) pointed out that being unbanked is not a permanent state and that many people 

have accounts, but don’t use them to their advantage. He described a number of community 

services that can help bring such individuals into the financial mainstream, including free tax 

preparation and Earned Income Tax Credit outreach, however he recommended for these 

services to go beyond the tax season. “One of the things we think we really need to work on, is 

creating a year-round experience so that our tax preparation is not just that point in time but it's 

following up with people later so that they have an opportunity to make some choices about what 

they do with their financial lives.” 

Featured Speakers 

Mr. Kerry Killinger, Chairman and Chief Executive Officer, Washington Mutual Inc. 

(Seattle, WA) spoke about the importance of education for the American economy and the 

American dream. He pointed out that there is not one “silver bullet” solution to addressing the 

challenge of unbanked people. He specifically described is institutions outreach to underserved 

markets, particularly by the availability of free checking accounts with no minimum balance as 

well as other innovative services. 

Mr. Rodney Hood, Vice Chairman, National Credit Union Administration (NCUA) detailed 

a number of challenges facing unbanked and underbanked individuals and the size of the market 

for alternative financial services. He also articulated a regulatory framework that is “effective 
Regional Conferences on Reaching the Unbanked 15

and not excessive” and manages, rather than avoids risk. This framework allows financial 

institutions to better serve currently underserved markets. He also described ways the NCUA 

can assist credit unions in reaching new markets. 

Effective Models and Practices for Reaching the Unbanked Panel 

Ms. Louisa Quittman, Director, Community Adjustment and Investment Program, US 

Department of the Treasury presented some general findings from the First Accounts grants 

program conducted by the Treasury Department. These findings included 37,835 accounts 

opened during the grant period, exceeding the established performance measures. Of those 

accounts, 70% kept accounts open beyond the end of the grant period. In addition, financial 

education proved to be critical, especially for participants that had difficulty managing accounts 

in the past. Other findings included innovative product development, strong partnerships 

between financial institutions and trusted community based organizations, and financial 

education curriculum implemented included FDIC’s MoneySmart and other materials found on 

Mymoney.gov 

Mr. Tom Berquist, Vice President of Marketing, BECU (Tukwila, WA) described how his 

organization provides financial education directly to its members and youth, and partners with 

community organizations to promote financial literacy and other community development 

objectives. 

Ms. Claudia Lopez, Assistant Vice President, Cashmere Valley Bank (Wenatchee, WA)

discussed how her small bank reaches the Hispanic population in central Washington. She 

discussed promotion, customer service, education, and community involvement as being critical 

factors in success in this effort. 

Mr. Gabe Mello, Asset Services Coordinator, Juma Ventures (San Francisco, CA) talked 

about factors that are unique to working with unbanked youth. He described using savings and 

asset building as a way to build skills and motivate young people and striking the balance 

between accommodating current needs and encouraging growth. 

Ms. Tricia McKay, Executive Director, Medina Foundation (Seattle, WA) described the 

low-income credit union that the Foundation is working on developing to serve the Seattle area. 

The organization did research to support the need for a new financial institution to serve the 

market, and they have partnered with a number of other organizations in the community in 

planning the credit union. 

Working Groups 

Conference attendees broke into self-selected working groups to discuss a number of topics more 

deeply and work toward action steps. After the working group sessions, each group provided a 

summary of the discussion to the plenary session. 

(1) What partnerships, roles, and steps are needed to develop a comprehensive local model 

to reach the unbanked? 
Regional Conferences on Reaching the Unbanked 16

Mr. Dave Sieminski reported back on behalf of the group discussing the comprehensive local 

model. Mr. Sieminski summarized some of the key partners identified by this working group 

identified key partners such as financial institutions, community organizations, chambers of 

commerce, colleges, law and advocacy organizations, housing authorities, employers, churches, 

city government, city conveners, and others to develop comprehensive constructive local models. 

Perceptions for both the consumer and supplier of financial products and services were also 

discussed as necessary elements to address to construct effective strategies for reaching the 

unbanked. Incentives were discussed as a foundation for the array of participating organizations 

to implement. The group identified an array of incentives that would be of benefit to the 

financial institutions, customers, community organizations, and overall local economies. 

Members of the working group took this opportunity to develop individual action plans and 

make commitments suited to their local communities. 

(2) What steps can be made to reach recent immigrants who are unbanked? 

Mr. Uriel Iniguez of the State of Washington Commission on Hispanic Affairs reported back for 

the group discussing recent immigrants. He noted that immigrants come to this country with a 

variety of needs and financial knowledge. He indicated that there are some organizational 

challenges to building partnerships, but that partnerships with employers, colleges, and Englishlanguage training programs are all important. Mr. Iniguez highlighted the usefulness of an 

integrated approach, meaning integrating financial education into the processing and intake for 

various programs, such as refugee assistance. 

(3) What innovative products, services and technologies can be used to reach unbanked 

people? 

Mr. Paul Knox from the State of Washington Department of Community, Trade and Economic 

Development represented the group discussing innovative products, services and technologies. 

He discussed a variety of matters, and underscored the need to keep products affordable and 

simple. Mr. Knox indicated that more guidance, training and clarity are needed from financial 

institution regulators because there are questions about what activities are acceptable and what 

are not. Mr. Knox indicated that it would be useful for financial institutions and community 

organizations to better communicate so that they can discuss what each can do. He reported that 

the group talked about having a wider portal for marketing financial products, like the Bank on 

San Francisco model, and perhaps using the trade associations. Other ideas discussed were 

involving apprenticeship programs, using train-the-trainer models, and having tax preparation 

volunteers open accounts. Finally, Mr. Knox described the idea of a reserve pool to share risk 

for small loan products. 

(4) What steps can be taken to reach youth/young people who are unbanked? 

Ms. Alice Jenkins from Bellevue Community College and Mr. Justin Grove from the National 

Credit Union Administration reported for the group discussing youth and young people. They 

noted that it is important to educate youth on financial matters from an early age, as well as 

educating their parents. They discussed the need to reach youth “where they are” “financially, 

socially, and spiritually.” Ms. Jenkins and Mr. Grove spoke about reaching youth through 

mentoring, role models (such as firefighters), and any other means to reach them regarding the 

importance of financial literacy. Mr. Grove also highlighted the need to affect public policy at 

federal, state and local levels. They discussed examples of incentives/awards for youth and the 
Regional Conferences on Reaching the Unbanked 17

need to reach young people who are not in traditional environments, such as dropouts or youth in 

shelters or foster homes. Finally, Mr. Grove discussed the importance of using innovative 

technologies and delivery systems, “guerrilla marketing” and making better use of websites. 
Regional Conferences on Reaching the Unbanked 18

IV. Eastern Regional Conference, New York, New York

On October 4, 2007, the Department of the Treasury, the Federal Deposit Insurance Corporation, 

the National Credit Union Administration, the Office of the Comptroller of the Currency, the 

Office of Thrift Supervision, and the Federal Reserve Banks of New York, Philadelphia and 

Richmond with the help of the New York City Department of Consumer Affairs Office of 

Financial Empowerment held the Eastern Regional Conference on Reaching Unbanked People 

at the City University of New York Graduate Center in New York City.

The Eastern Regional Conference focused on understanding the challenges of serving unbanked 

individuals; the necessity for financial institutions to tailor products to meet the needs for that 

market; outreach strategies for immigrant communities; and the need for collaboration with 

financial institutions to ensure that all Americans are able to participate in the economic financial 

mainstream, save, and build for better futures. Key factors to reaching the unbanked were 

identified as basic bank services at a lower cost, building credit, asset building for emergencies, 

and asset building to build wealth such as purchasing a home.

Welcome and Introduction 

Mr. Dan Iannicola, Jr., Deputy Assistant Secretary for Financial Education, U.S. 

Department of the Treasury welcomed conference participants and spoke about recent strides 

and continued challenges of helping the unbanked, and the necessity for building relationships 

with financial institutions. “We view it as an on-ramp to financial security and eventually 

prosperity. Once you get on the on-ramp, there’s a lot of great destinations,” said Mr. Iannicola, 

describing the impact that financial education and access provides to unbanked people. 

Ms. Anna Escobedo Cabral, Treasurer of the United States, U.S. Department of the 

Treasury encouraged conference participants to work together, build strong partnerships, 

creatively address the challenges to reach the unbanked population, and strengthen communities. 

Ms. Cabral encouraged the audience to share their ideas and best practices in for the unbanked 

and described Treasury’s programs that are implementing these principals to benefit individuals 

and families nationwide. “We’re concerned because getting more Americans involved in the 

financial mainstream sector is about investing in our communities.” 

Mr. Jonathan Mintz, Commissioner, New York City Department of Consumer Affairs

spoke about the role local government in helping low-income people gain access to financial 

services and the City of New York’s pilot program. Mr. Mintz described the basis of the City’s 

strategy as founded in identifying the leverage and power of local government to serve the 

underserved in New York City. Through the Conditional Cash Transfer Program, “We 

developed a bank account that was a safe bank account. It’s essentially a savings account. It 

uses an ATM, so there’s no overdraft problem, and there are no overdraft fees. There were no 

minimum fees”. 

Ms. Lul Berhane, representing New York Association for New Americans (NYANA) (New 

York, NY), told her story as a refugee finding challenges in saving in the U.S. banking system 

and her success in finally owning a home through an individual development account (IDA) 
Regional Conferences on Reaching the Unbanked 19

program. As of June 2007, NYANA’s IDA program has assisted 834 participants to save over $3 

million to purchase assets such as homes or small businesses. Ms. Berhane shared her story of 

reaching the American dream through financial education, eradicating her myths of financial 

institutions and the American financial mainstream, establishing credit, building a savings, and 

setting a goal to purchase an apartment. NYANA’s outreach efforts and financial education 

assisted her to achieve her goal of home ownership and continued savings. 

Plenary 1: Unbanked Overview

Ms. Cassy Gleason, Director, Community Affairs Unit, New York State Department of 

Banking (New York, NY) described how the New York State Department of Banking helps to 

promote the location of bank branches in underserved markets through its Banking Development 

Districts initiative (BDD). The initiative’s inception was due to the identification that in lowerincome communities, there were fewer bank branches. The BDD program has brought branches 

into underserved communities and offers banks incentives to participate in the program. In 2006 

the BDD branches 20,000 new accounts, half of them being savings accounts. In 2007 the BBD 

branches made more than $126 million in investments and loans, including community 

development lending and provided other services. 

Mr. Lee Bowman, National Coordinator, Community Affairs, Federal Deposit Insurance 

Corporation (FDIC) discussed how the FDIC is helping to facilitate financial institutions to 

reach underserved markets through financial education and product development. “FDIC sees 

what we call economic inclusion as a high priority.” As a result the Alliance for Economic 

Inclusion, a national initiative designed to bring people into the mainstream, was created. Each 

of the FDIC regional offices selected a market within their region with high concentration of 

unbanked people to reach through collaborative efforts. 

Ms. Melissa Koide, Associate Director, Financial Services and Education Project, New 

America Foundation (Washington, DC), described recently-released research linking the 

provision of financial education to the use of savings, particularly in non-profit communitybased program. Their findings indicated that “individuals, when they did receive education with 

an account product, they did appear to move towards greater financial stability, and that we saw 

demonstrated by their active use of accounts”. The study also indicated that when education and 

accounts are combined, individuals tend to engage in personal planning and budgeting, which 

may lead to increased financial prosperity.

Concurrent Session 1: Second Chance for Financial Services

Ms. Lynette Bell-Ndiaye, First Vice President, Suntrust Banks Inc., (Atlanta, GA) spoke about her 

bank’s strategies for working with customers with bank account problems and its participation in the Get 

Checking Program. 

Ms. Chiquita Board, National Education Director, Get Checking, EFD/eFunds Corporation 

(Duluth, GA), spoke about the Get Checking program, a national financial education program designed 

to help consumers establish a primary banking relationship with mainstream financial services. 
Regional Conferences on Reaching the Unbanked 20

Ms. Lenore McKenna, Executive Director, Charleston Area Community Development Corporation, 

(Charleston, SC), spoke about strategies for educating unbanked persons to make good financial 

decisions and to build wealth through savings and homeownership. 

Concurrent Session 2: Reaching Youth

Ms. Pamela Foster, Vice President, Community Development, Fifth Third Bank 

(Columbus, OH), described Fifth Third Bank’s youth mentoring program. Ms. Foster provided 

a handout titled “Young Bankers Club” describing the program overview, commitment, and 

affiliate commitment components. 

Mr. David Issac, Vice President/Branch Manager, North Fork Bank (New York, NY), along 

with Ms. LaKia Williams, described North Fork Bank’s partnership with a Bronx high school. 

North Fork Bank opened a full-service branch in the school lobby. The branch is staffed by 

students in a banking and finance class at the Fordham Leadership Academy for Business and 

Technology, one of five schools in the building. The students during their summer break work at 

North Fork branches throughout the Bronx, training as tellers and customer service 

representatives. The goal is to help students further their skills in banking services and to 

promote basic finance literacy among the wider student body. 

Ms. Katherine Shoemaker, Director, Policy and Special Projects, Harlem Children’s Zone 

(New York, NY) described the Harlem Children’s Zone’s Young Harlem Investors savings 

initiative. The Saving for Education, Entrepreneurship, and Downpayment (SEED) Policy and 

Practice Initiative is a multi-year national initiative to develop, test and impel matched savings 

accounts and financial education for children and youth. The initiative seeks to set the stage for 

universal, progressive American policy for asset building by bringing together national and 

community partners to design, administer, and document specific aspects of children's savings 

programs. 

Ms. Justine Zinkin, Executive Director, Credit Where Credit Is Due (New York, NY) 

described the school branches of the Neighborhood Trust Federal Credit Union and the credit 

union’s adult financial education initiatives. Their mission is to promote economic empowerment 

among low-income families by increasing their access to, understanding of, and control over 

financial services. This mission is accomplished via financial education services delivered in 

tandem with credit union services and complementary economic development initiatives. 

Concurrent Session 3: Reaching Immigrant Markets

Mr. Pablo DeFillipi, Associate Director, Membership Development National Federation of 

Community Development Credit Unions (NFCDCU), (New York, NY) gave an overview of 

strategies of new and existing credit unions to serve the Latino market. His organization has 

focused on the Latino market because of the size of the market and they make the largest group 

with lack of access to the financial mainstream. Mr. DeFillippi shared models of CDCUs that are 

serving the Latino community successfully by providing them access to credit and loans. In Mr. 

DeFillipi’s words, “if you ask any immigrant community, the main issue is not check-cashing. 

The main issue is access to fair credit.” 
Regional Conferences on Reaching the Unbanked 21

Ms. Linda Armyn, Vice President, Corporate Development and Government Affairs, 

Bethpage Credit Union (Bethpage, NY), described efforts of her institution to learn about the 

needs of the new Latino population in the suburban communities served by the credit union, and 

how they are partnering with key community organizations to deliver services to that market. 

Ms. Armyn stressed the importance of collaborating with community groups because that is the 

first place that unbanked people go. “When they come here, no matter what country they’re 

from, they reach out to churches,” she observed. Ms. Armyn encouraged participants to reach 

out to non-profit organizations and churches and to bring the financial services to these 

organizations because they are frequented, known, and trusted by the unbanked population. 

Ms. Deyanira Del Rio, Associate Director, Neighborhood Economic Development Advocacy 

Project (New York, NY) discussed her organization’s recent survey of the financial needs of 

approximately 600 New York City immigrants. The survey results indicated that immigrant 

communities “have a strong desire to tap into the financial services that already exist.” Ms. Del 

Rio described some of the greatest myths found among the unbanked immigrant populations 

regarding the financial institutions that can only be addressed with education in order to bring in 

this market into the financial mainstream. 

Concurrent Session 4: Building Community Financial Institutions

Ms. Tanya Branch, Vice President, North Carolina Minority Support Center (Durham, 

NC), described the efforts of her organization to support existing small credit unions, serving 

mainly rural communities, by centralizing their back-office operations, and providing technical 

assistance and funding. 

Mr. Luis Pastor, President and CEO, Latino Community Credit Union (Durham, NC) 

described the origin and growth of Latino Community Credit Union in North Carolina, one of the 

nation’s fastest growing credit unions. Mr. Pastor described the ability to meet the cultural needs 

of the market, and the importance of partnerships in growing the credit union. 

Concurrent Session 5: Asset Building and Financial Access

Ms. Rita Eygabroad, C.A.S.H. Director, Empire Justice Center (Rochester, NY) described 

the initiative in Rochester which includes outreach on the Earned Income Tax Credit, and access 

to free tax preparation assistance. The initiative seeks to take advantage of the tax return 

preparation moment to build assets and provide financial information and education. 

Ms. Yonki Tschering, Vice President, New York Association for New Americans Business 

Center (New York, NY) described the asset building programs provided by her organization, 

including microenterprise assistance, homebuyer assistance, and individual development 

accounts. 

Plenary 2: What can we learn from alternative lenders?

Mr. Michael B. Griffin, Senior Vice President, Community Development Banking, Key 

Bank (Cleveland, OH) described Key Bank’s experiment with providing check cashing and 
Regional Conferences on Reaching the Unbanked 22

other transaction services to non-customers that have been profitable and sustainable. Key 

Bank’s successful model consists of delivering the products the unbanked are getting today at the 

check cashers and bring them into the bank and educate them about the available financial 

products. Key Bank has partnered with non-profit organizations to deliver financial education 

and trained its employees to deliver financial education as well. In Mr. Griffin’s words, “We’re 

trying to approach this like any other market segment, so we think of this as the unbanked market 

segment. So we’ve got our high net worth private banking. We develop products for them. We 

want to say, okay, what are the products this segment needs? How do we make this a business 

that works for them that works for us, and we can meet their needs?” Some of the products that 

Key Bank offers include savings, a small line of credit, and the bank is currently working on an 

overdraft line of $250 to $500 for those that do not qualify for the standard overdraft that allows 

financial stability in an emergency. 

Ms. Amy Herlehy, Director, New York State Community Development, Citizens Bank 

(Rochester, NY) described a low-cost short-term loan product available for home improvements 

for low-to-moderate income communities. The product was developed as a result of town hall 

meetings conducted by Citizens Bank in local communities. Borrowers must own their house, be 

at 80 percent of the median income or below, or live in a low- or moderate-income 

neighborhood. “Basically what this is an unsecured loan. We don’t look for receipts or anything 

like that. It just needs to be home improvement. There’s no fees. There’s no closing costs.” The 

program is promoted by word of mouth in the communities, at branches, and through churches 

and non-profit groups. 

Mr. Larrey Riddle, Program Manager, Employee Advantage Lending Initiative, Mountain 

Association for Community Economic Development (Berea, KY) explained a new pilot to 

provide alternatives to payday loans in conjunction with financial education and counseling, 

through employer relationships. As background, he noted: “Between 1999 and 2006, new 

payday lenders opened in Kentucky at a rate of one every four days, collecting over $145 million 

annually from their low and moderate income customer base, a group that can least afford it, and 

this industry is growing much faster in other parts and more populated regions of the country.” 

The pilot program includes a financial education component, a mandatory savings component, 

and most loan payments are made through payroll deductions. For those customers that do not 

have a bank account, they offer a stored value card. 

Mr. Michael Wishnow, Senior Vice President, Communications, Pennsylvania Credit 

Union Association (Harrisburg, PA) discussed the new Credit Union Better Choice Program 

developed for credit unions in the state. The goal of the program is to transition people from the 

wealth-stripping cycle of predatory lenders such as payday lenders, check cashers, pawn brokers, 

and rent-to-own companies. Using the payday loan model, “a $500 loan over 90 days costs the 

borrower $450 in interest and fees. Using our model, with a $25 application fee and an 18 

percent rate of interest, the same $500 cost $40.09 for 90 days, so you can see it’s literally ten 

percent of the cost. In addition, they have 50 bucks in the savings account.” Mr. Wishnow 

reported the results of the 42 credit unions for the first six months: 1,682 loans totaling $877,000 

with an approximate savings of $600,000 to Pennsylvania consumers, and 1,682 new savings 

accounts. The Credit Union Association plans to do targeted mailings to include people receiving 

welfare checks, people receiving other benefits, and people that are more likely to be unbanked. 
Regional Conferences on Reaching the Unbanked 23

Summary 

A panel comprised of Mr. Iannicola, Mr. Barry Wides, Deputy Comptroller, Community Affairs, 

U.S. Office of the Comptroller of the Currency, Ms. Cathie Mahon Executive Director of the 

Office of Financial Empowerment, Department of Consumer Affairs , City of New York, and Ms. 

Louisa Quittman, Director, Community Adjustment and Investment Program, U.S. Department 

of the Treasury provided a summary of the conference and closing thoughts. The findings 

included the following ideas. 

• Financial institutions do not need to provide financial education directly. They can find a 

community organization to provide that service or an education provider, and make sure 

that that organization knows the underbanked market or the unbanked market. 

• In reaching the unbanked, it is important to build coalitions that cross sectors and include 

faith-based institutions, social service agencies, government agencies, and financial 

institutions. 

• Partnerships are critical, but partners should be selected carefully. The partners must 

understand their roles and do what they do best. 

• To reach the unbanked, organizations need to become “learning organizations” that 

reflect and continually improve their processes, services, and products. 

• Providing access to financial services takes a number of forms, including physical 

presence of a financial institution in an underserved community as well as active and 

strategic collaboration with key community organizations. Access also looks at 

overcoming regulatory and identification barriers and providing services at an 

appropriate cost. 

Financial institutions should think about long term business models in reaching underserved 

populations.