Fintech companies are offering ways for Latinos who can’t get debit cards to transact cashless.
Why is it important: Latinos are among the least banked (no household account) and underbanked (one account, but no access to services like loans) population groups in the United States, according to government data shows.
Drive the news: Many Latinos say they beware of banks or do not have the minimum balance to keep an account open.
- Reports show banks have historically charged people of color higher feesdid it Stronger to enable them to access commercial loans or grant them a higher cost mortgages.
The impact: It’s harder for Latinos without a bank account to access car leases or high-yield savings, gain financial literacy, and develop good credit scores.
- It also leaves Latinos – especially undocumented people – more dependent on predatory services like payday loanswhich have very high interest rates, or cashing checks or money orders, which have high fees.
Instead of banks, Latinos have for years embraced fintech products like PayPal’s Remitly or Xoom for sending remittances.
- New offerings specifically aimed at Latino and Hispanic immigrants include bilingual digital wallets like PODERcard or B9, which are apps with links prepaid debit cards that can be used in stores and ATMs, with no fees or minimum amounts.
- Welcome Tech, owner of PODERcard, is also working on a credit card system and discount offers on telemedicine and prescriptions, company co-founder Raúl Lomelí-Azoubel told Axios Latino.
- Some companies Translate credit history from other countries which might help people not to start with a blank slate.
What they say : “There is this myth that the migrant and Latino community only wants to do cash transactions, but that only happened because there was no other option,” Lomelí-Azoubel said.. “We know that this community wants to save, invest and it needs these financial solutions. »
Do not forget : April is financial literacy month. Resources that can help Latinos understand financial tools include Crediverso, with bilingual tools for guidance and comparison of insurance or loan options, and Latino Wall Street Spanish. Classes.
Editor’s note: This story has been corrected to reflect that Welcome Tech, not PODERcard, is working on a credit card system, as well as telemedicine and prescription discount offerings. He also specifies that Raúl Lomelí-Azoubel is the co-founder of Welcome Tech, owner of PODERcard.
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