Innovation Grant Will Help Charter Ohio's First Latino Credit Union

The Ohio Credit Union Foundation recently celebrated its 10th Anniversary.The Ohio Credit Union Foundation (OCUF) is leveraging a $69,500 Innovation Grant from the National Credit Union Foundation (NCUF) to a consortium of Toledo-area credit unions and community organizations to charter a community development credit union for Latinos in northwest Ohio.

If the charter is granted, Nueva Esperanza (New Hope) Community Credit Union would be the first new state-chartered credit union in Ohio in more than 20 years.

Serving the Fastest-Growing Community

This waiting room at a Mexican Consulate is just one sign of how quickly the Latino American community is growing.As the first Latino credit union in the state, Nueva Esperanza will reach out to a Latino American population that by all estimates has more than doubled since the 2000 Census. More than 50% of area households are classified as “low-income” or “extremely low-income.”

Meeting Basic Needs

According to Becky Hart, Executive Director of the Ohio Credit Union Foundation, these statistics point out the need for basic financial services and affordable credit within the community, which a credit union can provide.

During its first year, Nueva Esperanza Community Credit Union will focus on financial education, budgeting, basic savings, simple lending, credit counseling, and money transfers.

It will begin with two bilingual employees, then staff up to four bilingual employees in its second year.

Empowering the Community

“The Latino community is currently using a branch bank that offers no specific programs for small depositors, and charges fees for basic services such as money orders,” according to Barry Shaner, CEO of Directions Credit Union, which played an integral part in the foundation of the new credit union. “It is our understanding that area residents do not trust a financial institution that they don’t perceive to be an integral participant in the community.”

Nueva Esperanza’s mission will be “empowering the Latino community by promoting savings, increasing financial literacy among low-wealth and often unbanked Latino households, making loan capital available, and promoting community resources.”

Partners Laying Building Blocks

Toledo-area credit unions and community leaders met at Great Lakes Credit Union on January 16, 2009, to work toward the incorporation of Nueva Esperanza (New Hope) Community Credit Union.
Toledo-area credit unions and community leaders met at Great Lakes Credit Union on January 16, 2009, to work toward the incorporation of Nueva Esperanza (New Hope) Community Credit Union. The startup is being partially funded by an Innovation Grant from the National Credit Union Foundation.
OCUF is proud to be partnering with a number of local credit unions and community representatives who have laid the foundation and building blocks of the credit union during the last several years:
  • Viva South Toledo Community Development Corporation purchased the building where the new credit union will operate, and will relocate its own headquarters into the same facility. Viva South Toledo will provide members with housing assistance and other social services to complement the credit union’s financial services.
  • Directions Credit Union will provide all data processing services, terminals, software, recordkeeping, and accounting support. Based in nearby Sylvania, Ohio, Directions Credit Union will also provide operational staff.
  • Area Financial Services, a technology CUSO owned by five Toledo-area credit unions, will oversee the new credit union’s back-office operations.
  • Latino Alliance of Greater Toledo will help grow and sustain membership in Nueva Esperanza Community Credit Union.
The Ohio Credit Union League and its Northwest Chapter will continue to serve as planning advisors and provide additional resources including education and training for the new credit union’s board and staff.

“Access to basic financial services is a necessity in every community,” said Jennifer Ferguson, CEO of Bay Area Credit Union and President of the Northwest Chapter. “The credit union’s presence in South Toledo will help residents achieve financial literacy, establish credit, grow savings, and possibly even realize the dream of homeownership. All of this will go a long way toward stabilizing families and building community pride. We know from working together on this project that the strengthening of South Toledo and its residents must come from within.”

Goal: Open for Business by June 2009

The credit union has applied to the Ohio Division of Financial Institutions for a state charter and has set a goal to open for business in June.
With its startup partially funded by an Innovation Grant from the National Credit Union Foundation, Nueva Esperanza (New Hope) Community Credit Union plans to open for business in this building by June 2009.
With its startup partially funded by an Innovation Grant from the National Credit Union Foundation, Nueva Esperanza (New Hope) Community Credit Union plans to open for business in this building by June 2009.

12th of 14 NCUF Innovation Grants

This is the 12th of 14 NCUF Innovation Grants improving communities in 2009.

Innovation Grants are made possible by supporters of NCUF and members of corporate credit unions who invest in the Community Investment Fund (CIF).
Click to see how to invest in the CIF!During the 2008 Innovation Grants application cycle, NCUF received 41 applications requesting over $2.2 million in funding. This was nearly four times the $600,000 budgeted for Innovation Grants through the CIF.

“Grant requests were much higher because the needs were much greater,” related NCUF Deputy Director Steve Bosack, the Foundation’s staff liaison to the NCUF Grants Committee. “More credit unions are seeking innovative ways to serve people with low wealth and modest means.”

“As many credit unions as ever are investing in the Community Investment Fund,” points out NCUF Executive Director Steve Delfin. “Yet here’s the paradox: even though CIF balances reached an all-time high, the fund is now returning a much lower percentage of grant dollars. This is due to record low interest rates. So especially during these challenging economic times, we thank all 650-plus CIF investors, the NCUF Board and Grants Committee for allowing us to maintain our Innovation Grant commitments and reward credit unions serving low-wealth households.”
Click here to see how to invest in the CIF!