1 BankOn Referral Network Asset Building Panel Engaging Families for Success Conference October 28, 2013

1. Asset Development Strategies for Municipalities 2. High-Cost Fridge Services: The landscape for unbanked and underbanked consumers 3. BankOn Program Services 4. What Were Learning 5. Partnership: Strengthening the Referral Network 2 Topics

BankOn Referral Network The BankOn Referral Network is a program initiated by the Coalition of Economic Opportunity, including the City of Charlottesville, area nonprofits, and local financial institutions. Formally launched in April 2013, our partnership aims to provide unbanked and underbanked community members with increased access to financial education and safe, affordable consumer banking and lending products. 3

1. Asset Development for Municipalities: Models from the Maryland CASH Campaign and the National League of Cities 4

What is Family Asset Development? An anti-poverty strategy that helps low-income people move toward greater self-sufficiency by accumulating savings and purchasing long-term assets… Examples of long-term assets include a home, higher education and training, and a business. Source: Assets for Independence US Administration for Children and Families 5

Tools for Asset Building Individual Development Accounts (IDAs) Earned Income Tax Credit (EITC) Financial Literacy Children's Savings Accounts College Savings Accounts Source: Assets for Independence US Administration for Children and Families 6

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Six Ways to Start Building Financial Security & Opportunity at the Local Level 1. Raising awareness about available services and consumer protections. 2. Increasing access to financial education through provider networks. 3. Connecting residents to safe and affordable financial products. 4. Mitigating foreclosures by coordinating services and leveraging resources. 5. Preventing predatory lending through local ordinances. 6. Modeling a strong role for employers through benefit structures and human resource policies. 8

City Council Vision Charlottesville: A Great Place to Live for All of Our Citizens A leader in innovation, environmental sustainability, and social and economic justice, and healthy race relations. Economic Sustainability Our community has an effective workforce development system... We have a business-friendly environment in which employers provide well-paying, career-ladder jobs and residents have access to small business opportunities. 9

2. High-Cost Fringe Services: The Landscape for Unbanked and Underbanked Consumers 10

11 High-Cost Fringe Lenders

12 High-Cost Fringe Lenders Source: VaPERL

13 Cost of Being Unbanked Cost of Fees: On average fees are 5% of net income; about $1,000 in fees per year. Public safety: Without a safe place to keep their money, unbanked individuals are more likely to be victims of crime. Disaster preparedness: In the event of an emergency, unbanked families have no safe way to access their money, and any cash kept in the home may be lost. Asset building: Without a bank account, families lack the ability to save for the future, establish credit and access asset-building instruments such as loans for a car, small business or home mortgage. Source:

14 3. BankOn Referral Network: Safe, Affordable Deposit Accounts Alternative Small Dollar Loan Financial Education

15 Affordable Deposit Accounts BankOn or Partner Agency Financial Education Partner Bank or Credit Union UNBANKED BANKED

16 Deposit Account Features Member FDIC Federally Insured by the NCUA Member FDIC Carter Bank & Trust No or low opening deposit, no min monthly balance, no or low monthly fees, three free cashiers checks per month Options for clients with negative ChexSystems history and/or low credit score Some partners offer monetary incentives for completing financial education Some partners offer inclusive ID policies, options for people without SSN

17 Alternative Small Dollar Loan 1. Referral Through BankOn, MACAA, Love INC, or Charlottesville DSS 2. Qualification & Financial Education Clients qualify for the loan by providing proof of income and expenses, completing financial session on budgeting and credit, and creating monthly spending plan demonstrating ability to repay 3. Small Dollar Loan Virginia National Bank Loans of $650 with 18% APR, repayment terms of 6-12 months Member FDIC

18 Agency or Individual BankOn Referral Network Financial Education Provider BankOn Product BankOn Referral Network BankOn Product Financial Education Provider Financial Education Agency or Individual

4. What Were Learning 19

Information Gathering Who are we reaching? How effective are our products and services? What additional products and services would support family economic security? Can we refer clients to these or do they need to be created? What additional challenges are underbanked families facing? 20

Participant Survey Baseline and follow-up survey follows participants collecting data on: Financial goals and behaviors Current finances and financial history Desired products and services 21

Current numbers 22 Financial EducationCity Participants Albemarle Participants Other Counties Participants Locality Data not collected Totals Community Workshops For Unbanked/ Underbanked with referral to product Fin Ed Totals Affordable Consumer Products City Participants Albemarle Participants Other Counties Participants Locality Data not collected Totals Small Loans Bank Accounts Product Totals City Participants Albemarle Participants Other Counties Participants Locality Data not collected Totals Totals, Financial Education and Products

5. Partnership: Strengthening the Referral Network 23

BankOn Partnership 24 How can BankOn best support your clients? Individuals and Agencies: Contact BankOn directly at for more information, for product referrals or to schedule financial education. Agencies: Partner with BankOn to train frontline staff to refer your clients directly to BankOn products.