Four other loans tested had mixed results:

• Automobile refinance loans targeted to households based on data mining.
• QCash small-dollar loans relying on rapid underwriting and disbursement via a mobile application, and using relationship factors other than credit scores.
• Community microfinance small-business loans.
• Payday Payoff installment loans designed to consolidate high-rate payday loans or other debt into one affordable payment by leveraging alternative data for underwriting.

With grant support from Visa and the Ford Foundation, Filene began the research phase of the incubator project in August 2015, and completed the tests in December 2017. It recruited 40 credit unions, which issued 58,482 loans worth $84.8 million.

George Hofheimer, Filene's chief knowledge officer, said lenders can play a leading role in reducing the disparity of African Americans, Hispanics and other minorities in their access to basic financial services.

"Meeting the needs of financially vulnerable populations and pursuing financial stability do not have to be mutually exclusive pursuits," Hofheimer said. "Providing products like those tested in the incubator program can be a win-win-win for the customer, financial institution and community."

The ITIN loans proved to be popular among lenders and immigrant borrowers, 99% of whom were minorities. Two-thirds of the borrowers were new to the credit unions. Among borrowers surveyed, 97% said they would recommend an ITIN loan to family and friends. Twelve of the 13 credit unions planned to continue offering the loans after the test period ended, and all said they would refer ITIN lending to other credit unions. Their combined return on assets (ROA) was 3.81% on the program, compared with a movement-wide 0.75%.

Filene said it moved ITIN lending from the "lab" phase of its incubator program to the "factory" phase based on the program's financial viability, ease of use, consumer impact, and demand.

The think tank is working to develop an implementation toolkit in partnership with the National Federation of Community Development Credit Unions and Coopera, a Hispanic marketing company based in Des Moines, Iowa, serving credit unions. The toolkit will be used to promote the launch of ITIN Lending on a larger scale.

Additional funding from Visa will allow Filene to conduct long-term qualitative research into ITIN lending and small-dollar consumer lending, which will include both QCash and Payday Payoff loans.