Banks are continuously talking about their future. But many times, they do it in a very conservative way, thinking first about how to avoid past mistakes that led them to endure a few crises.
The use of new technologies is not the only important thing. We need to talk about financial inclusion first.
The financial services industry begins to realize that the consumer of the future, here in the United States, is more diverse from an ethnic standpoint and represent the key to more inclusive and solid business.
Hispanics are the fastest-growing group. If bankers ponder a future without complications, they have to talk about more and better strategies to include us.
Despite all the technology that allows anyone today to make a banking transaction from anywhere, Hispanics today expect:
▪ Marketing in Spanish by email and social networks
▪ Branches with a bilingual, trained and tested staff
▪ Translated educational materials
▪ Access in their language to online accounts and through “Apps.”
Outreach to small business owners and communities
Many Hispanic immigrants start their own businesses in hopes of building a better future. One of the biggest challenges they face is to get a loan.
In fact, Hispanic business owners are more likely to be rejected when they apply for a business loan.
Therefore, from the IHCC, we insist on the development of outreach programs to educate them on how to apply for loans, improve their credit rating, and better manage their commercial and personal finances.
This financial education, which banks can develop through reliable organizations such as IHCC, is what will generate long-term loyalty from small Hispanic businesses.
How to improve Hispanics’ access to credit?
Although the population of multicultural consumers continues to grow, homeownership rates among them have not kept pace with that growth.
In Illinois, the rate of homeownership for foreign-born residents in the country for less than five years is 10 percent.
Language and lack of access to credit history or personal documents are two frequent obstacles.
There are already banks working on mortgage products designed specifically for immigrants who recently arrived in the United States. These banks use information from foreign financial institutions to verify income, assets, and employment history. The entire industry should move in that direction.
The future, in Spanish
In his book “Banking 4.0 —Banking Everywhere but Never at a Bank”, the expert Brett King explains how, in the last 10 years, a sixth of the world population has used financial services without stepping on a bank branch. They do it at the time they want and in the language they understand best.
The old system cannot survive because it is not fast, flexible, and scalable enough in a world where 200,000 smartphones with Internet access are sold every hour.
To succeed in the future, banks need to think more about how to meet the needs of Hispanics. This includes the development of a comprehensive and localized multicultural marketing strategy and the availability of services in Spanish in all customer interactions.
IHCC has been a valuable partner for the financial sector for 30 years, and we will continue to help to include smaller businesses within the system.