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How Comunidad Latina Federal Credit Union Is Empowering Undocumented Immigrants to Achieve Financial Stability

Community PartnersLow Income Designated Credit Union

For many, Azul Sanchez’s story is a familiar one. According to Azul, as the daughter of undocumented immigrants, she was supposed to be another statistic: a Latina who graduates high school and starts working a warehouse job to help her parents. However, that didn’t end up being the case. 

As both a first-generation American and a first-generation college student, Azul enrolled in classes at the same time that she took her first job as a commercial bank teller. It took Azul 16 years to finish college, which she pursued in parallel to her career in the financial sector. Azul transitioned to credit unions and became a branch manager, an assistant vice president, and eventually a director of branch operations. “Being the first generation in this country, I didn’t have any guidance,” she said. “I didn’t know where to start, but I always say that banking turned my life around. I didn’t have a degree, but I had opportunities to keep moving up. I want my team to have the same opportunity I had.”

Azul Sanchez, CEO of Comunidad Latina Federal Credit Union

One of Azul’s mentors is Eric Orellana, the former CEO Comunidad Latina Federal Credit Union. When Eric retired in 2022, Azul applied for the position. Despite not having experience as a CEO, she was drawn to the position because she wanted to be able to give back to her community.

Comunidad Latina Federal Credit Union was started in 2006 with the mission to serve its community “by offering unique, empowering, affordable financial services with compassion, care, and dignity” to individuals who aren’t documented and who don’t have a social security number. Approximately 98% of Comunidad Latina’s members are undocumented; however, not all of the credit union’s members identify as Latino. To qualify for membership, individuals must live, work, worship, or attend school in the city of Santa Ana, or through an immediate family member that is a current member. They must also have a Matrícula Consular de Alta Seguridad, an identification card issued through the Mexican government to nationals residing outside of the country, and an Individual Taxpayer Identification Number (ITIN), which is issued by the IRS to be used on a tax return by those without a Social Security number. Currently, Comunidad Latina has approximately 1,600 members, which is approximately 10% larger than it was in 2022.

Comunidad Latina’s members face a number of challenges, including those that come with being undocumented, DACA recipients, and/or first-generation Americans. Additionally, many of the credit union’s members are either underbanked or unbanked, live paycheck to paycheck, and come from cultures where it’s taboo to discuss finances with others. More than 90% of Comunidad Latina’s members have an annual household income of less than $50,000, and in most cases, its members work two or three jobs to be able to afford their living expenses. “Many of our members don’t trust the banking system,” Azul said. “We have members who literally keep their money under their mattress.”

Team members from Comunidad Latina help a member.

Given those realities, one of the most important things that Comunidad Latina has to do with its members is build trust. The credit union does that by being intentional about whom it hires. For example, each of Comunidad Latina’s five employees, including Azul, understand the challenges of their community because they also belong to the community. Similar to Azul’s own story, two of the credit union’s employees are students. Importantly, Azul tries to instill the belief in all of her team members that if they have a desire to learn and help their community, then one day, they too can become the CEO of a credit union.

Unique Community, Unique Products

Despite Comunidad Latina’s small team and limited resources, the credit union is able to offer high-impact products to its community. One such product is its Share Secured Loans program, which the credit union adopted from, and tailored to, its community’s practices. Tandas are rotating savings and credit associations (ROSCA) popular in many countries around the world, including throughout Latin America. In short, a tanda is a way for people who know each other to collaboratively save and lend money to each other. For example, if 10 friends agree to contribute $100 each month, every member of the tanda will get to collect $1,000 at some point during those 10 months. Depending on which month a member collects their money, tandas act as a short-term, zero-interest loan, a way to plan for a big expense, or an opportunity to save money over time.

Comunidad Latina does something similar to tandas for its Share Secured Loans program: individual members save and lend money to pay-off a loan before they receive it. The reverse loan allows members to not have to worry about coming into the credit union with a deposit to use as collateral for a loan. Additionally, because these loans have an interest rate of 3.5% (compared to between 12% and 20% at big banks), this product also creates opportunities for members to build their credit as they plan for big expenses. “We created these loans, because that’s what our members understand,” Azul said. “Being able to understand our members and to provide guidance while allowing them to preserve their dignity is very important to building trust with them.”

Another way the credit union is able to support its members is by helping them to think beyond their financial wellness to other aspects of their lives. Azul has attended countless resource fairs, where she’s forged relationships with community partners. That has allowed her to build upon Comunidad Latina’s curated database of community resources that range from English courses and citizenship classes, to medical services and college enrollment assistance.

Through those same community partnerships, Comunidad Latina is frequently invited to lead financial literacy classes and workshops to youth and adults in Santa Ana, many of whom have never had a bank account. During their six-week classes, Azul and her team strive to empower participants with skills, knowledge, and awareness about their financial goals and wellness so that they can achieve financial stability. The classes cover topics like credit, savings, and budgeting, but Comunidad Latina also encourages participants to think about how their values align with their financial decisions. 

A large component of these classes involves participant-learning circles, which provide individuals a safe space to ask questions and obtain guidance on how to overcome financial challenges. Each participant is also paired with a mentor, who supports them throughout the entire six weeks. At the end of the class, participants have to present a vision board along with an outline of how they’re going to achieve their goals in order to graduate. 

According to Azul, unlike other financial institutions, the reason why Comunidad Latina leads these financial literacy classes isn’t to boost membership. “We do these classes wanting people to have financial stability and the financial freedom that they need and want,” she said. “If that means they’re going to open a membership at the credit union up the street or at a bank, that’s okay. I just want community members to be equipped with the tools that they need to be able to be successful.” 

Education is Everything

When asked about her vision for Comunidad Latina’s future, Azul shared her three goals for the credit union. First, she wants Comunidad Latina to develop its use of technology so that it can empower community members to take advantage of the digital transformation taking place in the financial services industry. By doing so, the credit union will be able to be more efficient, thus elevating its members’ experiences. Secondly, Azul wants to continue to grow and build trust within Comunidad Latina’s community through new and existing partnerships with other organizations. Lastly, Comunidad Latina’s CEO hopes to be able to one day open another branch somewhere else in Santa Ana so that the credit union can have a second location to serve more members. 

One of Azul’s favorite quotes is from Nelson Mandela, who said: “Education is the most powerful weapon which you can use to change the world.” To Azul, the words capture the work being done by her team at Comunidad Latina. “We’re doing everything we can to educate as many individuals as possible so they can help make this community stronger,” she said. “I ultimately believe with all my heart that that will reflect in a better world. That’s what motivates me. That’s why I work here.”

Comunidad Latina’s Team, (from left to right) Albert, Maria, Azul, Juliana, Diana, Martha.

Learn More:

  • Comunidad Latina Federal Credit Union (CLFCU) is a not-for-profit financial institution serving the community of Santa Ana, California. Their mission is to Serve their community by offering unique, empowering, affordable financial services with compassion, care and dignity.
  • CNote is a women-led investment platform that empowers individuals and institutions to invest locally to further economic equality, racial justice, gender equity, and address climate change.

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