KYLE, S.D. (11/27/12)--When newly chartered Lakota FCU opens here in December, it will be the first time the Pine Ridge Indian Reservation has had a federally insured financial institution in place. In a newsletter article welcoming Lakota FCU into the credit union family, the Credit Union Association of the Dakotas (CUAD) said that a "for-profit" bank was never really an option for the reservation.
"(A) not-for-profit credit union with a philosophy of 'people helping people' is a good fit for the more than two million acre reservation, one of the largest and poorest Native American reservations in the U.S. and home to approximately 40,000 persons, of which 35% are under the age of 18," the article said.
Whitney O'Rourke is the new credit union's manager, and she has been working on the credit union's development since 2010 with Lakota Funds, a community development financial institution (CDFI) that is helping to lead an economic resurgence of the Oglala Lakota Oyate on the Pine Ridge Reservation. Lakota Funds owns the Lakota Trade Center building where the new credit union is located here.
The credit union has received three start-up grants from the U.S. Treasury Department's Native American CDFI Assistance (NACA) Program. The grants enabled Lakota to hire one additional employee: Shayna Richards will be member service representative.
Lakota FCU's field of membership (FOM) will be comprised of those who live, work, worship, volunteer, attend school, or conduct business on the Pine Ridge Indian Reservation. Members are not required to be Native American.
The National Credit Union Administration (NCUA) has already designated LFCU as a low-income credit union (LICU), which means that it can accept deposits from anyone--whether or not they qualify under the FOM rule.
The CUAD article noted that the new credit union may face challenges attracting deposits because the area has an unemployment rate of greater than 80% and a history of dealing in "cash-only" transactions. But the credit union has addressed this by doing early advertising to get the word out that there will be a financial alternative for the community. The credit union representatives will be going to schools and businesses, encouraging people to open savings accounts rather than dealing with cash. Members will be able to access their funds through "CU Money" reloadable debit cards. Share draft accounts will not be offered initially.