by Felicia Mello
Salvador Duran
As the national economic crisis continued to affect banks everywhere, a San Francisco credit union celebrated the grand opening of its new Mission Street location Friday, offering an alternative source of low-cost loans and financial services for the area’s working class and immigrant residents.
City Treasurer José Cisneros and other community leaders turned out to honor the 2,000-member Mission SF Federal Credit Union, the only non-profit, community-owned financial institution in a neighborhood where half of residents have no bank account or credit history.
“In troubled times, people need a strong partner in managing their money and making their households more successful,” said Cisneros. “Credit unions are owned by their members and they can offer smaller loans at much smaller rates.”
At Mission SF, customers receive personal attention in their native language, said credit union CEO Salvador Durán. Unlike at traditional banks, any money invested in the credit union stays in the community.
“When someone applies for a loan here, it’s not a computer program that decides,” said Durán. “I read every application, and I talk to each person and try to help them.”
Leidy Sanabria (left) and Jessica Lozoya, members of the personnel at Mission SF Federal Credit Union. (Photo by Marvin Ramírez)
Durán gave the example of a 65-year-old Nicaraguan woman who survived on SocialSecurity and needed a small loan to pay expenses. While a mainstream bank might have turned her down, Durán talked to her and discovered that her sons in Miami sent her regular money orders. Based on that information, he was able to approve the loan.
Since 1971, the credit union made its home in a small third-story office that was not visible from the street. The new location at 3269 Mission Street, made possible by a grant from partner Patelco Credit Union, has attracted more customers. Since its doors opened in February, the number of new members joining each month has doubled.
Roberto Alfaro, a service provider at the Mission Community Response Network, brought one of his clients to the credit union Friday to open his first bank account.
“I bank here because it’s in the Mission District, it’s homegrown,” said Alfaro. “I’m trying to reinvest in the community.”
The credit union’s small size means it cannot offer some services provided by larger banks, like online banking. But it provides something equally valuable, said Cisneros: an alternative to the predatory payday lenders that proliferate on Mission Street.
“A lot of folks think that if they need $300 fast, they have no other option than to go to a payday lender, where they might have to pay 300 percent interest,” said Cisneros.
Such lenders cost the community an estimated $2 million in fees each year. While a $300 loan from a payday lender could end up costing close to $800 with fees, the same loan from the credit union would not cost more than $400, according to credit union staff.
MissionSF also offers free financial counseling through its affiliated non-profit, MissionSF Community Financial Center. Kids under 18 can join their own separate youth credit union, run entirely by teenage volunteers.
Sabrina Rabaneh, 11, joined the youth credit union when she was 4 and has already saved $1000 for college. She is now the credit union’s youngest volunteer, working to recruit other youth members.
“I think it’s really good for young people who have to earn money for important stuff like college,” she said. “My family thought it was weird when I started to work here but now they see it’s good for my future.”
