PHILADELPHIA — “You know that line about 'if you build it, theywill come?'” asked Oscar Torrealva, branch manager at the $1.3billion TruMark Financial Credit Union's branch in the financiallystrapped Eastern North Philadelphia. Torrealva said that conceptwas nonsense, “at least when it comes to this sort of work. If youwant to help low-income and underserved people start to use yourfinancial services, you can't wait for them to walk in your door,you have to go to them.”

Torrealva, a tall, intense looking Peruvian-American recountshow many meetings the credit union staff held with neighborhoodgroups and local nonprofit agencies in the first days after TruMarkopened the branch two years ago. He also recalled how many streetfairs the staff attended, how many school presentations they madeand how many small businesses they visited.

“People will not trust you until you show that you are notcoming at them from outside but are really here, part of theirworld and that they can know you,” he added.

With their history of being organized by people who alreadyshare some sort of common bond, whether in the workplace,geographic area, place of worship or other interest, the notionthat they might be seen as “outsiders” in a low-income communitycan surprise and even rankle credit unions seeking to serve a newlow-income area, according to Pablo DeFilippi, director ofmembership development for the National Federation of CommunityDevelopment Credit Unions and former executive with the Lower EastSide People's Federal Credit Union in New York.

Nonetheless, if a credit union wants a branch in a low-income orunderserved area to succeed, it needs to acknowledge thatparticular gap and take steps to address it, he said.

That gap looked particularly wide when it came to the part ofNorth Philadelphia where TruMark located its branch.

At least 29% of the area's residents lived beneath the povertyline in 2009, compared to 12% for the Philadelphia metro areaoverall, according to the U.S. Census Bureau and ThePhiladelphia Inquirer. Forty percent of the area's childrenlived in poverty, compared to 16% in the metro area generally.Almost 24% of residents had no high school diploma.

The gap might have been too great for TruMark to overcome exceptthat the area also had already established the sort of organizationthat DeFilippi said almost any credit union seeking to establishitself in an underserved area would need to have.

The Asociación Puertorriqueños en Marcha was founded in 1969 bya group of Puerto Rican-born activists, primarily in the healthfield, who recognized their community's need for organization andoutreach if it was ever going to be considered part of thePhiladelphia mainstream. In the more than 40 years since, theorganization has grown to a leading community developmentorganization that also offers health services, housing services andeducational services. And it became the chief sponsor of TruMark'sarrival in the area. The organization led the effort to find afinancial institution willing to put a branch in the economicallyembattled neighborhood after being rejected by several banks beforefinally finding TruMark and financing most of the construction ofthe credit union's branch.

But even with as strong and well-known a backer as APM,Torrealva pointed out, TruMark staff still had to go to the peopleof the neighborhood and introduce themselves and show them whyworking with the CU would be different than working with a bank.They also had to show they were willing to listen to the communityabout the sorts of products and services they needed the most.

“Sometimes there are some assumptions about the products andservices that lower income communities are going to need most,”DeFilippi said. “In some cases, those assumptions might be ontarget, but in many cases they will not be. Once a credit unionmeets the community it wants to serve, the next step is to listento what the community wants.”

In TruMark's case, Torrealva said, the community was clear thatit wanted a CU branch that looked like TruMark's other branches andthat it wanted the community to have access to the same productsand services as other branches. That meant that when TruMark laidout and decorated the interior of the branch, the credit union madesure it picked up on familiar themes, decorations and furnishings,Torrealva explained. The CU also made sure that the full range ofproducts and services were available, including mortgages andcredit cards, but not remittances, an item that many credit unionsbelieve they almost have to offer in underserved areas.

“Our most popular products are the share-secured credit cards,”Torrealva said, noting that the card allows CU members to haveaccess to credit and build up their credit scores while exposingthe CU to little or no additional risk. By contrast, he reportedthat the branch does not offer remittance services, noting that themoney transfer service did not score very high in member surveysand that there were other, lower cost options for that service inthe neighborhood.

Once a credit union has met and listened to its members orpotential members from a low-income area about what financialproducts and services they want and need, the next task is toprovide them–and to do so with patience, DeFilippi explained.

“The likelihood is that the CU is going to find itself withmembers whose basic knowledge about financial services and how usethem are all over the map,” said DeFilippi. Helping low-incomemembers access and use those products and services may takemarkedly longer than with other members.

Torrealva said this has become very evident in the area ofchecking accounts, one of the credit union's most basic services.In many cases, the credit union finds that its low-income memberswill not be able to open a checking account because of a black markwith one of the check account qualification programs such as ChexSystems. But where other potential members might not have blackmarks at all, or might be better positioned to correct any theyhad, TruMark often has to work with members to help them understandand rectify the negative report.

It is not unusual for a new member at the branch to not be ableto open a checking account, Torrealva explained, but instead ofsimply denying the application, TruMark will help the member findout where the outstanding balance remained and get it paid off.

TruMark has added 1,300 members through the branch, Torrealvareported, and although the branch still lagged others in terms ofdeposits and loan balances. it has outpaced the others in terms ofimpact.

DeFilippi encouraged mainstream credit unions that areconsidering serving an underserved area more deeply to take thetime to put the three steps of meeting, listening and then workingwith low-income members into effect. Over time, he pointed out,these initial hurdles will diminish and the credit union will findit has become an integral part of a community that is both hungryfor growth in general and growth in financial services inparticular.