Independent Banker - May 2020 - 49

agency partners, such as the United Way, that already have
relationships with unbanked consumers refer their clients
to participating institutions.
" They are the ones saying to the folks, 'You need a bank
account. Here is a vetted list of four banks that won't
charge fees,' " Williams says. " I can't stress enough how
important community partners are. It's that coalition
partner they trust that's bridging that gap. "
Modeled after the national Bank On movement that
began in New York and San Francisco and took root
in urban areas, Williams sees the Bank On Arkansas+
initiative as a natural extension of Southern Bancorp's
mission as a community development financial institution
(CDFI) in a state that exceeds national statistics for the
unbanked and underbanked. " [The initiative] answers a lot
of the reasons why they don't choose to use a bank, " he says.
Southern Bancorp has opened more than 220 Bank
On accounts so far. As Bank On customers become
comfortable with the bank, staff are trained to ask
questions and feel out whether that customer or
community member might be open to other bank
services, such as debt management, budget building, and
homebuyer and credit counseling. Williams adds: " All our
employees know how to pull a credit report and go over it. "
While Southern Bancorp is reaching the unbanked
" Every community banker
I know really cares deeply
about the places they serve
and wants those places to
continue to thrive. "
-Darrin Williams,
Southern Bancorp
and underbanked through community partnerships,
$375 million-asset Lead Bank in Kansas City, Mo., is
seeking to help people with limited or nonexistent credit
by partnering with Self, a fintech innovator in Austin,
Texas, to provide online Credit Builder accounts.
The phrase " credit invisible " describes the 26 million
U.S. adults who lack a credit history with at least one of
the national credit bureaus, according to the Consumer
Financial Protection Bureau. Another 19 million are
" unscorable " due to thin or stale credit histories.
Lead Bank's Credit Builder account and savings program
helps consumers build a credit history by combining
an installment loan with a certificate of deposit, or CD.
Consumers borrow money to invest in a Lead
Bank CD. Each payment is reported to the
credit bureaus, allowing the consumer to
build a positive credit history in a financially
responsible way. Once the loan is paid off, the
customers will have a CD equal to the amount
they borrowed.
" In any of our small towns we serve, we are
seeing people trying to establish credit and
struggling, " says Josh Rowland, Lead Bank's
CEO. " It fits the mission of community banking
and our community bank to find innovative
ways to reach people. "
Launched in 2018, the program is popular;
the bank opens approximately 600 accounts
a day. Self reaches out to consumers without
a credit score and markets the product via
Facebook and Google, helping Lead Bank reach
customers nationwide.
Credit Builder is also very profitable. The
loans don't generate credit risk, since they are
secured by the deposit, making the default rate
inconsequential, Rowland says. If people stop
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Independent Banker - May 2020

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