JACKSON, Miss. (7/16/14)--Hope FCU's efforts to eradicate "bank deserts" in the Deep South were recently recognized in public remarks by former U.S. President Bill Clinton.
Speaking on behalf of the Clinton Global Initiative, the 42nd U.S. president cited Hope FCU's commitment to bring financial services to ZIP codes that are served by two or fewer financial institutions.
"Hope FCU made a commitment two years ago, in 2012, to serve people who were in what they call 'bank deserts' in the Deep South where local banks were closing up or not serving low-income working people," Clinton said. "That is emblematic of what we could be doing everywhere to be creating opportunity at the bottom of the (economic) pyramid."
Clinton specifically mentioned how Hope FCU opened branches in Utica, Miss., and on the campus of the University of Arkansas-Pine Bluff.
Hope FCU has increased its branch network to 23 from seven locations since the onset of the recession in 2008, according to Bill Bynum, president/CEO of the $187 million-asset Jackson, Miss.-based community development financial institution.
"Banks are really leaving these communities," Bynum told
. "There's a huge need for the services we provide. We're doing everything we can do to respond to that need."
That need is indeed great. Of Mississippi's 533 ZIP codes in 2012, 369 had one bank or fewer, the Corporation for Enterprise Development reported. And about 37% of Hope's new members did not have previous banking relationship, Bynum said.
Reaching underserved communities is about more than branches. Mississippi also has great stretches of rural areas, which account for lack of access to financial services. To fill that gap, Bynum and Hope FCU have worked to equip and educate new members on mobile branching.
"We think that could be a real way to democratize financial services," Bynum said. "People in rural areas are smart enough to know that a smart phone gives them access to the Internet.
"They can text. They can communicate. They can participate in social media, and not have the cost of a landline or a computer. At the same time, so many of them are outside the banking system. We're excited about the potential to put the power of banking in people's hands," he said.
More than half of the credit union's active mobile-banking members live in high-poverty areas, Bynum told
. "It's allowing us to reach a population that is woefully underserved," he added.
Bynum said his employees have moved beyond helping members with transactions to become real problem solvers. Clinton mentioned this in his remarks, noting that employees helped members get up to speed on mobile banking.
"In addition to banks leaving these communities, we've got payday lenders entering at an epidemic rate, so helping people avoid those debt traps is another challenge we face," Bynum said.
Another challenge is raising capital to continue the credit union's outreach efforts. "Most credit unions grow organically, but we're very serious about tackling these bank deserts," Bynum said. He said the credit union is about halfway to its goal of raising $20 million in capital and seeks deposits from other sources, including other credit unions. With the additional funding, the credit union can add 15 additional branches and open new accounts for 30,000 consumers, Bynum said, while making more than $500 million in consumer and business loans.
In the meantime, Bynum said it was "fantastic" to receive public recognition from Clinton. "He has been a leader in solving huge problems around the world since he left the White House," Bynum said. "For him to highlight Hope as an example of what's possible in serving people at the bottom of the pyramid serves as a challenge for us to keep pushing forward."