Media Notes Maine CUs As “Viable” Alternative For Mainers Stuck In Debt Trap
July 22, 2014
A recent editorial that ran in most of Maine’s daily newspapers pointed to credit unions as a viable alternative to the growing number of Mainers “who are turning to high-interest alternative credit, including pawnshop loans, rent-to-own contracts and payday loans. Across the country, including in Maine, local government agencies, credit unions and other financial institutions have joined forces to offer low-cost accounts, eventually enabling consumers to build a credit history and access more affordable credit sources.”
According to the most recent figures analyzed by the Federal Reserve Bank of Boston, 7.5 percent of Maine households used alternative financial services - 25 percent more than the U.S. average and nearly double the rate in New England. The Maine Credit Union League’s President John Murphy said the findings indicate that Maine credit unions “may have an opportunity to build new relationships with a percentage of the population who are not using a financial institution for borrowing or, in many cases, financial services at all. With our continued investment in our statewide awareness campaign and new and creative ways to reach different audiences, we can build new relationships with this segment of the population.”
Gene Ardito, President/CEO of cPort CU and the Board Chair of Community Financial Literacy (CFL), which does significant work with the immigrant populations in Portland and Lewiston on financial services and literacy, agreed, adding, “Once they understand the cooperative model of credit unions, immigrants and others find credit unions very appealing. I’ve learned in working with Claude Rwaganje, Executive Director of CFL, that many refugees and immigrants come from cash-based societies and struggle to understand the complex American financial system. The lack of understanding and access to U.S. financial institutions is a primary barrier to economic and social integration into the local community.”
The Maine CU League is a significant partner of CFL and a number of credit unions are supporters as well.