|Volume 5, Issue 1, 2005||Federal Reserve Bank of Dallas|
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Task Force Launched to Promote Financial Services for Immigrants
Texas now has its own task force focused on encouraging immigrant access to mainstream financial services. A coalition of financial institutions, federal agencies and community organizations, the Texas New Alliance Task Force (TNATF) was officially launched on April 27 at a forum in Austin where participants discussed issues and obstacles in providing financial services to immigrant markets.
TNATF has been in the works since spring 2004, when planning began for a Texas coalition modeled on the Chicago New Alliance Task Force. The task force includes three working subcommittees—Asset Building, Financial Products and Services, and Regulatory Issues—that will meet monthly to address issues that impact immigrants and to discuss best practices.
TNATF plans to build on the initial rollout in Austin to eventually reach throughout Texas, and the Federal Deposit Insurance Corp. (FDIC) has initiated task force activity nationwide.
TNATF's mission is to facilitate asset building for immigrants by improving access to the U.S. banking system, providing financial education, and developing innovative remittance and mortgage products. The FDIC has cited a critical need for these services. Multicultural markets are experiencing rapid growth, with projected buying power increases of 77 percent and 90 percent for the Asian-American and Hispanic markets, respectively, by 2007.
"Financial education is a big piece of this initiative," points out Alfreda Norman, community affairs officer for the Federal Reserve Bank of Dallas. "Making financial services friendly and easy to reach for those who are traditionally unbanked can mean lower fees and costs for bill paying, check cashing and sending money to relatives [remittances]. Having an understanding of the workings and benefits of the U.S. banking system can also make a difference in accessing credit and other services to build wealth and assets."
Awareness is paramount not just for the immigrant, but also for financial services personnel at the front line when it comes to working with alternative forms of identification and documentation, such as the matrícula card and the individual taxpayer identification number. "Having consular ID cards gain acceptance as valid identification to open an account gives banks a great opportunity to reach out to a largely unbanked population," says Ann Baddour of Texas Appleseed, a nonprofit organization involved in immigrant financial issues.
Other ways to reach out are noted in Texas Appleseed's 2004 publication Meeting the Financial Service Needs of Mexican Immigrants: A Survey of Texas Financial Institutions. For instance, banks that resemble check-cashing stores or customer service counters are more inviting to Hispanic immigrants seeking financial services. Having personnel who speak their language is also a plus.
Bonnie Wolferd, director of emerging markets with AIG United Guaranty, sums it up: "Making our traditional financial services user-friendly and available to all individuals and families helps provide tools for wealth-building that will strengthen our economy and communities."
e-Perspectives, Volume 5, Issue 1, 2005