Resource One Credit Union
Resource One Credit Union (R1CU) has been helping hard-working Texans achieve their financial goals since 1936. R1CU is one of the largest 10 minority-designated credit unions in Texas, and the largest CDFI and minority credit union in Dallas.
Originally founded to serve employees of Sears Roebuck and other companies, they continued to expand the credit union by converting to a community charter. R1CU now has 11 branches serving communities throughout Dallas and Houston.
A critical community resource
The need for fair and responsible financial services in Texas continues to grow. According to the Center for Responsible Lending, the state ranks highest in the country for predatory lending. This amounts to more than $1.67 billion in fees and interest on payday and title loans from low-income and unbanked communities.
Due to the correlation between race and banking status, much of these fees are being extracted from households of color. Accessible and equitable financial services from CDFIs and community development credit unions like R1CU is critical for preventing predatory loans and supporting asset and wealth building opportunities for under-resourced communities.
Increased funding for meaningful lending
To assist in the effort to reduce predatory lending and to continue serving their community at the highest level, the credit union recently applied for and received new grant funds. In 2021, they were awarded the CDFI Rapid Response Program grant.
“This grant will help us look for new ways to provide meaningful lending to all of our members,” says Tracey Jackson, Chief Financial Officer of R1CU. “One way is to provide small dollar loans to help our members who find themselves in the payday lending cycle.”
R1CU has also been granted $5 million from Inclusiv’s Southern Equity Fund—a $45 million fund that invests capital in credit unions serving low-income and communities of color in 17 southern states.
Thanks to Inclusiv’s Southern Equity Fund, R1CU will further expand its reach and commitment to servicing marginalized minorities and low-income populations. This additional money will go toward increasing lending through the credit union, and therefore reducing the number of Texans relying on usurious payday lending options.
“The urgency of the racial equity gap and need for inclusive, community based solutions is clear,” says Cathi Kim, Director of Inclusiv/Capital. “Resource One is an excellent example of how organizations can both grow and promote change and move beyond commitments to action.”
Kim explains that Inclusiv's Southern Equity Fund invested in R1CU to support their leadership, demonstrated impact, and vision for helping realize the unmet opportunities and economic empowerment in communities of color.
“By designing innovative and inclusive products and cultivating relationships to strengthen community based and led change, Resource One demonstrates leadership in advancing racial equity and financial inclusion within the credit union and in partnership with the communities they serve,” says Kim.
Securing these funds is a win for the credit union, but also for the R1CU community and surrounding cities. Reducing the amount of payday loans circulating the community means fewer people are trapped in a dangerous—and sometimes unrecoverable—cycle of debt. Less debt can lead to more savings, the ability to buy and maintain a home, improved financial wellness, and a more positive outlook on the future—all of which can, in-turn, benefit the community at large.
Connecting racial equity, growth, and sustainability
A theme that remains consistent across this work to reduce predatory lending and improve the community is the need to grow and sustain racial equity.
“It’s important to us at Resource One to focus on racial equity, growth, and sustainability because they are interconnected,” Jackson says. “These should be core tenets for diversity, equity, and inclusion (DEI) in the credit union space.”
One way that R1CU practices what they preach is through the makeup of its staff, of which 75 percent is comprised of people of color.
“In order for our credit union to grow and to have sustainability, our staff needs to be able to do the same,” explains Jackson. “Studies have proven that a diverse leadership team has helped improve institutions’ success rates. We believe in training our staff for professional development. We will continue to strengthen our team by providing even more resources for their development and opportunities for growth.”
An industry-wide commitment to DEI
Jackson also serves as a board member and treasurer of the African-American Credit Union Coalition (AACUC), and says they have been very successful in providing thought leadership through their endorsement of the Eighth Cooperative Principle, which commits credit unions to DEI.
“Credit union professionals are leaning in and finding ways to support and eliminate racism, and to also reduce the racial wealth divide,” she explains. “I am very encouraged by the number of credit unions and credit-union-related organizations that ask AACUC for assistance and guidance on reducing the racial wealth divide.”
“Together with the AACUC’s Commitment to Change: Credit Unions Unite Against Racism Initiative, not only can we provide a credit union solution, we can help eradicate the racial equity divide.”
Community partnerships to fulfill dreams
Capital funds will also go toward delivering loan products such as citizenship loans to help R1CU’s Hispanic members fulfill their dreams of becoming American citizens. This will be accomplished in large part through the credit union’s new partnership with Dallas Area Interfaith—a non-partisan, multi-ethnic, multi-issue group of religious congregations, schools, and other nonprofits in the Dallas metropolitan area.
The goal of this partnership is to work within the community to implement systemic societal changes and to help the Hispanic community—part of the credit union’s colored majority—not only fulfill their dreams of becoming citizens, but also owning homes and accessing financials services they are unable to get elsewhere.
Other key partnerships for the credit union include one with Vogel Alcove—an organization that provides daycare services for children in homeless shelters while their mothers look for employment.
“Once our CEO Mary Beth Spuck found this organization, she made it our objective to partner with Vogel Alcove to help them in their mission,” Jackson says. “This partnership is another way Resource One gives back to our community.”