Related Link: Recent Accomplishments

EXPANDING IMMIGRANTS' ACCESS TO
FINANCIAL SERVICES

Immigrants need improved access to mainstream banking services so that they can develop the banking histories and credit ratings that that are the first steps up the economic ladder toward building assets. Bridging the gap between the banking and immigrant communities requires accurately assessing immigrant populations' financial needs, gauging their interest in - and reluctance toward - financial services, and better understanding of the barriers to and opportunities for increased immigrant use of financial services.

Often immigrants hesitate to use banks for fear that their personal information would not be secure. It is noteworthy that, in the face of similar circumstances, the “Bank on California” initiative was launched in part to be a catalyst prompting banks to reconsider their identification requirements for bank accounts.

Immigrants also need the tools – the financial understanding gained from financial education materials – that can help them obtain loans and make better financial decisions. Since many such tools have already been developed within the Appleseed network, Connecticut Applesesed began distributing them to immigrant communities across the state during 2008. It is Connecticut’s good fortune that other state-based “Centers” in the Appleseed network have been working hard for more than six years to help Latino immigrants enter the financial mainstream, so their resources and experiences can expedite Connecticut’s unique but related efforts.

Appleseed Project Team’s Related Accomplishments To Date

1. A survey completed pro bono in early 2008 on our behalf by financial services research firm Greenwich Associates found that Connecticut banks already had many product and service initiatives in place.

2. However, we have learned that banks are spending lots of time and money on outreach that has not been particularly successful; immigrants in this state tend to remain unbanked.

3. By surveying roughly 600 immigrants from Stamford through New Haven in early 2009, we have gathered useful feedback on how financial institutions could better reach and serve immigrant markets. Key factors cited by respondents include: operational changes (e.g., extending branch hours and broadening the availability of bilingual tellers), better clarity on overdraft and returned-check fees and provision of remittance services at competitive and clearly-posted rates. But, unsurprisingly, the biggest reason cited for failing to create a bank or credit union account is the lack of acceptable identification.

Moving Toward a Statewide Initiative

Connecticut has a significant economic stake in this issue. The best available estimate of Connecticut’s “unbanked” population at the Federal Deposit Insurance Corporation’s Boston office is 16% of total 2004 households, or almost 216,000 households. Since Connecticut suffers persistent out-migration of its mid-life, working-age (ages 40-64) population, the relative importance of immigrants to the state’s economy will continue to increase. That is why, in the second half of 2009, our project team will evaluate whether we may be the logical entity to catalyze a “Bank on Connecticut” initiative using the Bank on California model. Such a program would help state residents without checking or savings accounts to open “starter” accounts, in part, by encouraging financial institutions to modify their identification requirements for new accounts. Bank on California is a voluntary program based on a collaboration of city mayors, non-profits and community groups, financial institutions and state and federal bank regulatory agencies.