Mega Bank Skips Town, Premier America Steps In

The pace of bank branch closures in the United States has doubled since 2020, according to the latest report from the Federal Reserve of Philadelphia. The nationwide trend is leaving more consumers in banking deserts and hits close to home for Premier America Credit Union ($3.5B, Chatsworth, CA). When a mega-bank closed its branch on the California State University Northridge (CSUN) campus just two miles from the cooperative’s headquarters, Premier America realized there was a large need that wasn’t being met.

So, the San Fernando Valley cooperative became the official credit union of CSUN and changed its guidelines to help serve underbanked and unbanked students, tailoring solutions to meet the needs of a diverse student population that includes international students and DREAMers who came to the United States as children.

“One of the concerns we heard from the University was that many students had difficulty opening accounts because they didn’t have acceptable forms of ID,” says Marci Francisco, chief experience officer for Premier America. “The former bank turned them away.”

Today, Premier America accepts current student IDs as a second form of identification to reduce the barriers to opening an account. It also provides educational webinars and seminars in both Spanish and English and recruits bilingual branch staff to connect more authentically with students who might not be familiar with banking terminology or the U.S. banking system.

To meet student needs, the credit union also offers products such as a Bank On certified checking account that charges no overdraft fees or monthly fees and requires no minimum balance.

“With the special savings bonus we provide, students can join the credit union with just $1 and start learning how to build healthy savings habits and manage their money,” Francisco says.

To meet community needs, the credit union is starting to offer Individual Taxpayer Identification Number (ITIN) loans. It also collaborates with several credit union industry partners and the Mexican Consulate to support marginalized communities, going as far as to visit strawberry and onion fields to meet people where they are and provide access to financial services. Elsewhere, the cooperative works with the local juvenile justice system to bring financial education to detained youth. It also serves foster youth via a collaborative program through which the credit union provides financial advice and money management to those who are aging out of the system.

It’s all part of the credit union’s efforts to welcome all members.

“Every year, we’re seeing the communities we serve here in Los Angeles and Ventura counties and in Harris County, TX, become more diverse,” Francisco says. “It’s important to us that when consumers walk into our credit union, they can see themselves here and feel they belong.”

That environment extends to all of the cooperative’s locations, especially as it focuses on extending its footprint into more underserved markets.

“In the near, mid, and long term, we want to get into more of the banking deserts that surround us and serve those communities,” Francisco says.

Although many factors drove Premier America’s decision to expand its footprint with an on-campus branch and pursue a long-term partnership with CSUN, the support of its board was a critical factor.

“The University powers the economic engine of the Valley,” Francisco says. “CSUN’s mission to empower and uplift the community through education is incredibly aligned with our mission as a cooperative. There’s a great synergy in what we both want to accomplish.”

From a strategic perspective, forming early relationships with college students as many establish their first checking account is an ideal way to drive healthy and sustainable growth for the institution. Indeed, although 2023 marked the first full year of the on-campus branch, the CSUN partnership is a couple of years old and, so far, membership growth has been nearly five times higher than the credit union’s initial projections.

That’s impressive, but Francisco challenges credit union leaders to look beyond the quantitative and take qualitative factors into account when deciding where to expand their branch footprints.