DES MOINES, Iowa—Credit unions looking to boost lending in 2015, particularly auto, should consider a Hispanic outreach program, according to results from a new study.
The CUNA/Coopera National Hispanic ROI study recently released shows that credit unions in the study, on average, increased loan growth by more than five percentage points three years after instituting an outreach program.
Coopera CEO Miriam De Dios told CUToday.info that among the 86 CUs in the study, average overall lending growth stood at 8.62% three years following outreach implementation, up from 3.51% the year the program began.
“This clearly shows there is strong demand for loans from the Hispanic market—great news for credit unions looing to increase lending,” said De Dios. “The numbers show Hispanics are not just looking for a transaction-based relationship. The want more long-term partnerships where they can borrow multiple times.”
While the study did not break down which areas of lending inside the credit unions grew the most, De Dios said that Coopera’s work with credit unions over the years shows Latino community borrowing leans toward auto. “But we do see interest from Hispanics in all types of borrowing. They may show less interest in mortgages, which we believe has a lot to do with lower credit scores.”
For any Hispanic outreach program to work, De Dios emphasized that the effort must be relevant to the Latino community—meaning well-planed products that meet the needs of the local Hispanic market, and staff who not only speak Spanish but understand Latinos. She also stressed that credit unions will not be successful with any Hispanic outreach unless there is buy-in throughout the credit union, starting at the top.
De Dios said more analysis from the study is coming. “We are digging deeper. A second analysis will compare results of credit unions in the study to those that do not have Hispanic outreach programs. We will also look at the high performers in the study to share best practices.”