In the age of technology, it might not come as a surprise to discover that only 4 percent of Americans don’t own a cell phone. And even as companies across all industries make their products and services more mobile friendly and online accessible, about 25 percent of Americans are unbanked or underbanked. (The Daily Beast)
According to The Daily Beast article, Millions of Americans are Underbanked: Here’s How Better Internet Access Could Change That. About 6.5 percent of U.S households have no bank account at all, and another 18.7 percent of those that do have bank accounts turn to alternative services and lenders outside of their banks or credit unions. The people making up these percentages are notoriously immigrants, people of color, people living in poverty, or with disabilities.
The article also stated that “more than one-third of Americans don’t know how they’d deal with an unexpected bill of $400.” These findings tell us that a large percentage of Americans struggle to find financial representation within their financial institutions. They also lack a general knowledge of loans, investing, and budgeting. TFCU has made strides to lessen this percentage within their community by partnering with Banzai. An online financial education community that provides free articles, calculators, and coaching sessions to help people of all ages and backgrounds understand their unique financial situations and manage them.
TFCU VP of Marketing, Alejandro Yu spoke with The Daily Best on this issue. “People going paycheck to paycheck often end up going to payday lenders in their community because of the lack of access,” he said. The interest rates from predatory lenders greatly contribute to keeping people trapped in cycles of poverty.
In the wake of COVID-19, banks across the country have either completely closed their doors or significantly limited in-person services and transactions. Forcing financial institutions to figure out virtual and digital alternatives to meet their customer’s needs.
Meeting customers where they are is exactly what TFCU did with the launch of their Community Self-Service Branch. This POD like vessel allows you to quickly and safely conduct your typical deposit ATM transactions, while also allowing you to speak to a teller virtually if you need assistance, want to open or close an account, apply for a loan, and much more. The credit union recently launched its Virtual Appointment System, where you can schedule a one-on-one consultation with a Member Service Representative via Zoom, live chat, and over the phone.
“We’re a border community in El Paso, and we have a lot of first- or second-generation Latinos like myself. My parents grew up experiencing banking in Mexico, where you’d go to a traditional bank and wait there for hours,” Yu says. “When people come here to the U.S., there’s some hesitation. They still want a person to tell them they have the money in their account. But once you show them, they can do everything from their phone, it opens everything up.”
TFCU is amongst the many financial institutions to temporarily close their physical lobbies due to COVID-19. Since then, they have made it a priority to promote and communicate the online services available to their members. They have even gone as far as making personal one-on-one phone calls to their elderly members and their families to assist them with this transition and answer any questions.
“People in our community might have internet on their phone, but it’s not unlimited, so they’re really cautious about what services or apps they use,” Yu says. “With universal internet, we could expand our online banking usage, especially for underserved areas. It would be amazing for us and for our customers as well.”