By John San Filippo
Hope Credit Union isn't just a financial institution; it's a beacon of economic opportunity in the Deep South. With a strong commitment to serving the underserved, Hope goes beyond traditional banking, offering financial products and services designed to empower communities and bridge the racial wealth gap.
"We are a minority depository – a black and women-owned financial institution," explained Ed Sivak, chief policy and communications officer at Hope Credit Union. This identity drives Hope’s approach, recognizing the unique challenges faced by its members. "If you look at Hope’s membership, about a third of our members were unbanked when they joined the credit union. On any given day, two-thirds have less than a thousand dollars on deposit with us, 75% earn less than $50,000 a year."
An Evolution
Hope’s origin story is intertwined with two organizations: the Hope Enterprise Corporation, a small business loan fund founded in 1994, and Hope Community Credit Union, established a year later. "Both organizations grew up alongside each other," said Sivak. In 2002, the two merged, leveraging their respective strengths to create a holistic financial institution capable of serving both individual and business needs.
"The Enterprise Corporation … was largely lent out," Sivak explained. "The credit union … had really slow growth." The merger provided the credit union with the sophisticated back-office support it needed, while offering the Enterprise Corporation a depository. This strategic move, facilitated by a new markets tax credit transaction, catalyzed Hope's growth.
Hope's trajectory has been punctuated by moments of exponential expansion, often in the wake of disasters. "Hurricane Katrina was a pivotal moment for us," Sivak recalled. Hope played a vital role in the recovery process, building homes and providing financial guidance to families rebuilding their lives. The Great Recession and the pandemic also served as catalysts for growth, with Hope expanding its reach and its services while other financial institutions retrenched.
Branches Play an Important Role
Hope’s commitment to physical branches in underserved areas underscores its community-focused approach. "We don't just look at branches as a mechanism to conduct transactions," Sivak emphasized. "Eighty-three percent of our branches are in high poverty, majority Black communities. There are many communities where we're the only financial institution." These branches serve as vital community hubs, offering not only financial services, but also spaces for empowerment and respectful interaction.
Technology Is Key
Technology plays a supporting role in Hope's operations, allowing the credit union to provide convenient access while maintaining its personalized approach. Hope leverages Jack Henry’s Symitar platform for core data processing and its Banno platform for digital banking, alongside specialized systems for commercial loans and mortgages. "We use Banno so that we can interface with members no matter where they are," Sivak noted. However, loan decisions, particularly for mortgages, are made manually. "It's not automated," Sivak clarified. "And that I think has a lot to do with our impact." This personalized underwriting allows Hope to consider individual circumstances and extend credit to those who might be overlooked by traditional lending institutions.
Serving the Community
Hope’s dedication to its members is evident in its innovative programs. The "borrow and save" loan provides an alternative to predatory payday lending, extending a lifeline while simultaneously encouraging savings. "It's a thousand-dollar loan; $500 goes into a savings account, $500 goes to the borrower," Sivak explained.
Hope’s impact extends beyond individual financial well-being. By empowering members through financial services, Hope fosters a sense of ownership and civic engagement. "94% of Hope Credit Union members voted in the last presidential election," Sivak noted. "When you own something, you've got a stake in the outcome of your community."
Sivak tells a poignant story of a woman who opened her first checking account at Hope on her 100th birthday. "It was the first time she had ever opened a bank account," he said, "because she never felt welcome in a financial institution." This exemplifies Hope’s dedication to inclusivity and its understanding that, for many of its members, "the simple act of walking through our front door is an act of courage."
Hope's success lies in its unwavering commitment to its mission: "to improve the financial health and wealth of residents of the Deep South." Through innovative programs, personalized service, and a dedication to its members, Hope Credit Union truly embodies the credit union ethos of "people helping people." It's a model not just for financial institutions, but for any organization seeking to create positive change. "Ownership matters," Sivak concluded. "If we want to fix democracy in America, we need to find ways to get our credit unions to serve more people, to become owners." Hope Credit Union is leading the way.