Latino Community CU first to offer Directo a Mexico

DURHAM, N.C. (6/12/06)--Strengthening the remittance network, Latino Community CU will be linked to BANSEFI--one of the largest banks in Mexico--through the Directo a Mexico program.

Last week, the Durham, N.C., credit union started to provide the service, which charges a flat $3 fee, regardless of the amount that is transferred, and offers the same exchange rate as the Federal Reserve.

The program will change the face of the remittance industry in the U.S., said President/CEO John Herrera, who made the announcement at the beginning of the fourth annual Latino Credit Union Conference (The Herald-Sun June 7).

The Federal Reserve Bank and Banco de Mexico created the low-cost remittance program.

To use the service, consumers have to have an account with Latino Community CU and a savings account at one of BANSEFI's banks. Members can open accounts at BANSEFI at any of the credit union's five branches.

The difference between the Directo a Mexico program and traditional remittances is the emphasis on savings. Traditional remittances are cash-to-cash transactions.

Directo a Mexico transfers money from account-to-account, helping members start relationships with financial institutions and begin building wealth, said Elizabeth McQuerry, assistant vice president of the retail payment office of the Federal Reserve.

Earlier this year, Southwest Corporate FCU became the first corporate credit union to help U.S. credit unions get involved in the program.

It added an international screen to its automated clearinghouse (ACH) origination service to accommodate the Directo a Mexico transfers (News Now May 19).

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