CDFI Credit Unions Can Grow And Thrive
Concord Federal Credit Union
Inclusiv and Concord staff
Concord Federal Credit Union is located in Bedford-Stuyvesant, a traditionally Black neighborhood of Brooklyn in New York City. The credit union was founded in 1951 by the Concord Baptist Church; today, it serves a majority population of Black and Hispanic people. In Bed-Stuy, the poverty rate is 23%, which is more than 1.5 times that of New York and almost double that of the United States. Approximately one-in-five households are unbanked and nearly 30% are underbanked, with high usage of expensive check cashing and high-interest predatory loans.
Concord has been an Inclusiv member since 2013. Inclusiv helped the credit union become CDFI certified in 2018 and to successfully secure a CDFI Fund Technical Assistance Grant. As a CDFI, Concord is eligible to apply for other stimulus grants released in 2020 and 2021, which meant funding for their work in the community. “Having that certification opens up resources for the credit union, particularly the opportunity to get grants from the Treasury. It keeps us going, and we’re able to offer more products to our members,” says Denise A. Michaux, President and CEO of Concord FCU.
Concord also received a grant for $125,000 from the CDFI Fund. It helped them to build up their internal support: hire staff that would set their vision into practice and adapt to remote work during the pandemic. As Michaux notes, Concord had to help themselves during these challenges so that they could then help the people and the businesses of Bed-Stuy: “We are members of the community, too.”
Without a doubt, CDFI credit unions know, understand, and serve their community. Darnell Joseph, a 32-year-old entrepreneur also involved in real estate, is a Penn State graduate and started a restaurant, IV Purpose, with three partners. They were in progress with opening and business licenses when COVID hit New York.
Because IV Purpose was technically not open in 2019 but in 2020 and showed no profit, yet, they were ineligible for many loans and grants. In the midst of his search, Mr. Joseph was introduced to Concord FCU through the Bedford Stuyvesant Restoration Corporation, a community development based in Brooklyn.
"The loan process was easy and transparent. Concord was understanding and open with the limitations of the loans, and what I could do and couldn’t do. They guided me throughout,” Mr. Joseph said. “With that money, we paid our rent, increased our inventory, and purchased PPEs."
Some businesses built outdoor dining, often spending $10,000 to $20,000, but that cost had not been part of IV Purpose’s business plan, especially when East Coast winters limited the use of any outdoor spaces. However, with the loan from Concord, they added in some outside seating. IV Purpose is now open seven days a week and does catering and events. “We were able to get a second round of the Paycheck Protection Program, but it was very limited on what we could use it for.”
Mr. Joseph was familiar with credit unions. His aunt had worked with a major financial services group, and she raved about credit unions. But he hadn’t realized that his business was blocks away from Concord. Due to being a part of the neighborhood, and his connection to Restoration to facilitate the loan, he was able to introduce himself and share the ideas of IV Purpose being a community asset.
"At a credit union, you deal directly with your loan officer. There’s a personal connection; he or she understands your story and what you’re capable of doing. I made myself known. And Concord said, ‘If you can make it through COVID, you can make it through everything else.’”
Among other guidance and investments from Inclusiv, Concord has converted to the i-POWER platform, a new core processor, made possible with a partnership between Inclusiv and VisiFi. This launched online banking for Concord’s membership. The credit union also built up products and services to attract new members, including ACH deposits and pre-paid debit cards.
As part of a project with Citi to grow and expand Black credit unions, Inclusiv provided technical assistance to Concord by arranging a strategic planning session, making targeted introductions to address various topics (field of membership expansion, business planning, and financial counseling), helping identify sources of funding and grants, and through monthly calls with the credit union staff and board members.
The pandemic has been challenging for both credit union members and credit unions themselves. While Concord has limited office hours for health and safety reasons, their doors are nonetheless open to members who come in for transactions and loan applications.
Looking back at this last year, Michaux says, “Concord FCU has a great team, senior leadership, and board members. We're building a community-focused structure and have been successful in adapting our action plan so that we are able to operate safely and yet meet our members' needs. It has been challenging, but we're taking it one day at a time."