Many microfinance institutions and credit unions serve low to middle-income earners. Experts generally call these families “the underbanked,” because many financial decision makers and primary earners from these families choose alternative ways to deal with money. Often, this can purely be because they don’t believe they qualify for any kind of formal banking service, rather than because they actually don’t qualify….so how can you attract people in the communities you serve, encouraging them to try out your microfinance services or at least walk in the door? Here are a few suggestions.
Offer some supplementary services:
Non-member check cashing services;
A seated study or reception area that anyone can use;
Free cookies, coffee or snacks;
Free school supplies;
Raffles for expensive learning supplies like computers, tablets and e-readers; and
Services like calling card sales
Mobile phone minute sales, and
- Passport photo services
These services are all helpful to low-income earners and will draw them to your bank.
Educate them on the perils of poor financial choices.
Low-income earners either naturally distrust banks or just don’t feel a connection to them. They rarely see any reason to have a relationship with a financial business like a bank, if they don’t have a lot of extra money to store in one.
Since your tellers might not have the time or the salesmanship to disburse financial education verbally, it’s important to distribute brochures during every exchange that you have with your customers and potential customers. This shows them that you’re not trying to sell them anything; but rather educating them and trying to help them understand:
How to avoid using any form of high interest credit, pay day loans and bank overdrafts to make ends meet,
That most pay day loans carry a 400% interest rate,
That check cashing stores charge unnecessarily high fees,
That predatory lending is predatory, (and that, “predatory,” is not just a popular term); they are victims,
That you offer integrated solutions for community banking like fixed interest rate loans, with no refinance penalties, and
- That you offer all the same financial services they are going to disreputable companies for, and you charge less money