FINANTA Seeks to Make Banking Local in South Kensington - Generocity Philly


May 22, 2015 11:11 am

FINANTA Seeks to Make Banking Local in South Kensington

Community lender FINANTA seeks to launch a credit union

Until 2011, the Borinquen Federal Credit Union offered residents of South Kensington a local banking option where they could open a savings account, apply for a loan, or seek financial assistance, all in their own neighborhood.

Then the 35-year-old institution ran into some financial and legal trouble, ranging from mismanagement to outright fraud.The National Credit Union Association, which insures savings at credit unions, took over the bank in the summer of 2011 and shut it down less than a month later.

Since then, nothing has taken its place. Not entirely anyway.

FINANTA, a community development financial institution (CDFI) located just off American Street in South Kensington, has provided financial capital to the area for the last 18 years in the form of business loans, mortgages and technical assistance. But Finanta is not a bank, and it’s unable to provide certain crucial services.

That could be about to change as FINANTA works on forming its own credit union, which are member-owned, generally community-based banks. It would provide access to basic financial services and products, such as debit cards, checking or savings accounts and check cashing.

“FINANTA doesn’t offer traditional banking services,” said Chris Ortiz, an intern for FINANTA who is spearheading the effort to form the credit union.

Anyone who lives, works, volunteers or goes to school in the area roughly bound by Olney Avenue on the north, Spring Garden Street on the south, 10th Street on the west, and Front Street on the east will have access to the credit union.

“Finantia is a CDFI and it’s doing great work, but it’s mostly on the finance end,” said Will Gonzales, executive director of Ceiba. This is great, he added, but the low-income, largely Latino population living in this area is still very much in need of basic banking services.

Ceiba is a coalition of community-based, Latino organizations, including Esperanza, FINANTA and the Norris Square Community Alliance. Many of coalition’s members were also members of Borinquen.

From our Partners

“We worked very closely with [Borinquen],” Gonzales said, adding that it was “oasis of financial services in the community.”

When Borinquen first set up in the community, Gonzales explained, there was a lot of predatory lending and unregulated procedures at large banks such as overdraft fees that had the effect of “nickel-and-diming” low-income people.

This can still be a problem today, Ortiz said.

“From what I’ve heard so far from the community, the traditional banking system has some fees and barriers that prevent the community from accessing those services,” he said. “Most credit unions do not have some of those membership or user fees, like transaction fees, or they are lower at credit unions.”

The process of forming the credit union could take anywhere from nine months to a year and a half to complete. FINANTA is currently circulating a survey to gauge the interest of stakeholders.

Next steps in the process are to assess the demand, understand the needs of the community and prepare a business plan, as well seek out potential board members. All of this information is sent to the National Credit Union Association for approval, which then grants FINANTA the right to create the credit union.

Photo via Alex Vuocolo


From our Partners

Nonprofit AF: Stop expecting nonprofits to merge. It’s annoying

Can EITC be a tool for poverty alleviation or wealth building in Fairhill?

Tech used for public safety elicits mixed emotions in Norris Square and beyond


Generocity Philly

Inscripción Doble en Congreso: Lo que trae el futuro

Philadelphia and Bala Cynwyd

JFCS of Greater Philadelphia

Youth Engagement Program Coordinator

Apply Now
Philadelphia, PA

United Way of Greater Philadelphia & Southern New Jersey

Chief Knowledge Officer

Apply Now
Philadelphia, PA

Campus Philly


Apply Now

The memo barring immigrants from being included in the Census is ‘further motivation to be counted’

Al igual que las organizaciones cambian el modelo de promotora para lidiar con COVID-19, las fundaciones cambian su patrocinio

As nonprofits using the promotora model pivot due to COVID-19, so do their funders


Generocity Philly

Dual Enrollment at Congreso: Where does it go from here?

Philadelphia, PA

The Pew Charitable Trusts

Senior Officer Pew Fund

Apply Now

Neighborhood Gardens Trust

Development and Communications Manager

Apply Now
Philadelphia, PA

Friends of the Rail Park

Public Programs Manager

Apply Now

Sign-up for daily news updates from Generocity