Credit Unions Reach Underserved Communities

In keeping with the credit union movement’s commitment to help all people realize their financial dreams, many institutions are focusing on serving the “underbanked” and “unbanked” in communities throughout the United States. 

According to a June 2013 FDIC-sponsored study, its third National Survey of Unbanked and Underbanked Households, 24.8 million households (20.0% of all U.S. households) were underbanked. Additionally, 7.7% of households in the United States were considered “unbanked,” representing nearly 9.6 million households. According to a report by the accounting firm KPMG, this underserved market of underbanked and unbanked consumers represents more than 88 million individuals and nearly $1.3 trillion in wages.

One credit union committed to serving-the-underserved is Communidad Latina Federal Credit Union ( in Santa Ana, Calif. President/CEO Erick Orellana says his credit union of 2,400 members has opened its doors to immigrants who have been issued what is called an Individual Tax Identification Number (ITIN) by the IRS, which allows immigrants without green cards and Social Security Numbers to legally work and pay taxes. 

While an ITIN is generally accepted by financial institutions if the cardholder wants to open a checking or savings account, it will most likely not be accepted for lending or for issuance of credit cards.

Communidad Latina is different. With less than $20 million in assets, Communidad is percentage-wise one of California’s fastest growing smaller credit unions. Orellana says his credit union does indeed accept ITIN documentation from its members for securing loans, which accounts for the majority of both its personal and auto lending activity.  

Orellana points out that the delinquency rate of his loan portfolio is .0019%, considerably lower than comparably sized financial institutions, which on average have a delinquency rate of .0043%.  “My members greatly appreciate the services that we provide and are vigilant about making their loan payments and staying on top of their accounts,” says Orellana.

Express Credit Union ( in Seattle, Washington, also recognizes the need for a program to reach out to the underbanked/unbanked segments which, according to Chief Financial Officer Paul Baudin, account for up to 30% of the city’s population.

“Our mission is to pave pathways in the community for financial progress with a special outreach initiative designed to keep residents out of what we term the cycle of poverty,” says Baudin.

To this end, Express has launched its Community Tellers program that works with local non-profit social program providers throughout King County to offer improved access to financial services.  Via the credit union’s mobile service, the tellers assist visitors to the non-profits with opening accounts, depositing checks, applying for loans and discussing financial matters. The representatives also provide basic financial education and referrals to financial programs offered through the non-profit organizations.

And, in Bend, Oregon, MidOregon Credit Union ( has implemented several programs to reach out its underserved populations. This includes providing ATM service on the nearby Warm Springs Indian Reservation, where financial services are scarce, according to MidOregon Marketing Vice President Kyle Frick.

“Helping people access financial services has been part of our DNA since MidOregon CU was founded in 1957 by eight educators to serve the school district employees at that time,” says Frick.

Realizing the difficulties faced by the Warm Springs Tribe population in accessing financial services, MidOregon in 2010 placed a CO-OP ATM in the tribal credit office for members to conduct transactions on the reservation, alleviating the need to drive more than 30 miles to Madras, Oregon, just to deposit a check.

“We feel strongly about building new relationships that benefit our members and the credit union,” says Frick.

Questions about this story? Contact James Pearson: 206.340.4790,

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