California CU gains certification to help underbanked open checking accounts
For California customers in your auto finance portfolio who might not have a checking account already, they might have an option to get one through California Credit Union.
The institution said last week that it received certification by the national Cities for Financial Empowerment Fund (CFE Fund) for its checking account product, which can benefit the nearly 19% of California households that are categorized as underbanked or unbanked.
According to a news release, California Credit Union is among only four credit unions in Los Angeles — and only 15 credit unions in California — offering accounts certified as meeting the benchmark Bank On National Account Standards.
California Credit Union’s Option Checking account is certified as meeting the Bank On National Account Standards, bringing a new level of inclusivity, access, and choice to banking and financial education for unbanked, underbanked, and underserved community members in Southern California.
“We believe a core aspect of our cooperative mission is inclusive banking, ensuring everyone in our communities has equal access to safe, affordable banking products and services that build financial stability and long-term financial health. This Bank On certification will support our work in making traditional financial products available to unbanked and underbanked community members outside of the mainstream financial system,” California Credit Union president and CEO Steve O’Connell said in the news release.
“We are excited to lead the way in this key initiative in Southern California, and look forward to working with local coalition partners to ensure all individuals can bank, save, and borrow with a trusted financial partner, supported by financial education tools to assist in life-long financial success,” O’Connell continued.
California Credit Union pointed out that a key challenge facing unbanked/underbanked individuals has been a lack of safe and appropriate accounts offered by mainstream financial institutions.
Without a checking account, California Credit Union said many consumers use high-fee alternative services, including check cashers, payday lenders and pawn shops, paying far too much for basic financial transactions and losing the ability to build savings, assets, and a strong credit history.
California Credit Union’s Option Checking offers safe access to a traditional checking account, with zero fees or overdraft charges to support moving members out of a debt cycle.
The account provides a free debit card, along with access to online and mobile banking, individualized financial counseling, financial education tools, and more than 30,000 surcharge-free ATMs nationwide. Members can sign up for the account online or in any credit union branch.
The CFE Fund certification is the latest step in California Credit Union’s work to meet the needs of underserved populations in its communities.
In addition to its Option Checking account, the credit union has adjusted underwriting guidelines to provide easier access to funds as well as launched credit card products designed for members looking to build/restore credit history.
It also offers a full suite of financial education and literacy resources; last year alone, virtual programs reached over 26,000 individuals and in-person events provided over 750 people with financial literacy training.
According to an FDIC 2021 survey, nearly 19% of households in California are categorized as underbanked or unbanked.
In addition, 4.5% of all U.S. households are categorized as unbanked, without a checking or savings account, and over 14% of U.S. households are underbanked, meaning they use non-traditional financial services.
“The Cities for Financial Empowerment Fund is delighted to award its national Bank On account certification to California Credit Union’s Option Checking account,” said Jonathan Mintz, president and chief executive officer of the Cities for Financial Empowerment Fund.
“Option Checking offers Southern California residents who are looking to improve their finances a safe, affordable, and truly useful mainstream banking product to access and manage their money. California Credit Union’s offering of this terrific account brings them into the forefront of national banking access efforts, and we thank them,” Mintz went on to say.