- Author: National Council of La Raza
Latinos continue to be among the most unbanked ethnic minorities in the United States. The report highlights the challenges confronted by the unemployed, differences in financial engagement by citizenship status and the use of bank technology by participants.
The report found an important link between naturalization (citizenship) and increased usage of financial systems—noncitizen Latinos were less likely to engage in banking practices. The report also found that 73 percent of the participants managed to put away some savings despite the down economy and that good customer service was paramount to deciding where to bank.
“As the Senate debates how to overhaul our nation’s immigration system, it is interesting to note the link between immigration status and engagement in our financial institutions,” stated Janet Murguía, President and CEO of NCLR.
“Many eligible immigrants have been unable to naturalize because of the cost prohibitive fees, while others may be struggling with finding a way to fully legalize their status under current law. There is no doubt that Hispanics are an increasingly critical consumer base, particularly in times of economic recovery when their full participation helps to stimulate the economy through purchases and savings. The more engaged and fully participating in our financial services they are, the more they and the nation benefit.”
The survey also delved into the use of technology for banking purposes, finding that younger Latinos were more likely to use mobile banking technology when compared to older Latinos. Those who had a bank account were more likely to have access to the Internet than Latinos without a bank account and were more likely to have performed a financial transaction using this medium. Those who demonstrated reluctance to using the internet for this purpose were primarily concerned with the security of personal information.
The report details a body of recommendations to increase Latino financial engagement, including expanding citizenship and economic integration, increasing account ownership through goal-based outreach and product development, promotion of personal savings and bridging the tech divide with trusted partners that can help assuage fears of privacy violations.
“Bringing Latinos into the practice of engaging financial institutions to create savings, make purchases and manage their personal finances will be of huge benefit not just to their long-term success, but to the nation’s short- and long-term economic growth and stability. We are encouraged that through building the right partnerships and engaging in purposeful outreach and educational efforts, we will be able to effectively reach the underserved Latino community,” concluded Murguía.
Source: Originally published on National Council of La Raza as Latino Financial Access and Inclusion in California, June 6, 2013