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Chapter 1

CREDIT UNIONS SERVING HISPANICS: A NATIONAL PERSPECTIVE 5

ccording to theUnited States2000 Census, 35 million Hispanicpeople live in the

United States, accountingfor 12.5% of the popula-tion. Latinos are the fastestgrowing demographic seg-ment in the country. Butwhat does this statisticmean, who is considered"Hispanic" or "Latino" andhow can credit unions bestserve this growing market?

Defining the Hispanic population

Like any term used to describe aparticular group of people, there'sconsiderable debate about themost appropriate term to describeand identify the group. The mostwidely used and accepted termsare "Hispanic" or "Latino,"although some people incorrectlyuse the terms "Spanish" and"Mexican."

Hispanic: The term "Hispanic" isgenerally applied to all Spanish-speaking people and implies a cul-tural heritage or lineage fromSpain.

Latino: "Latino" refers to peopleoriginating or having a culturalheritage from Latin America. Thisterm does not imply Spanish her-

itage, but rather the manyromance languages derived fromLatin (Spanish, French, andPortuguese) that are spoken inLatin America.

Spanish: Many people in theUnited States refer to any Spanish-speaker as being "Spanish," howev-er, this term should only be usedfor people from the actual countryof Spain. Using this term to groupall Spanish-speakers is like callingeveryone who speaks English, bethey British, American, Australian,or Canadian as "English."

Mexican: Because of the largenumber of people in the UnitedStates who have Mexican origins,people sometimes refer to anygroup of Spanish-speakers as"Mexicans." Again, use this termonly to refer to people actuallydescended from the country ofMexico.

Chicano: Another term that isgrowing in popularity in someparts of the country is "Chicano."This is a relatively recent term thatmany Mexican descendants haveused to reflect their unique cultur-al mix. Mexican-American activistsused the term to refer to them-selves during the '60s and '70s and"Chicano"—once a derisive term—has now become a more wide-spread term among Mexican-Americans.

The terms "Hispanic" and"Latino" are the most acceptableterms and they are often usedinterchangeably. Some people may

prefer one term to another, but theterms are both used equally bygovernment organizations, com-munity groups, and educationalinstitutions.

All of these terms describe agrowing number of people in theUnited States who speak Spanishin all or part of their daily interac-tions; participate in holidays andspecial events specific to Spain,Central or South America, or theCaribbean; possess cultural beliefs,behaviors or other factors com-monly attributed to people fromthese areas; and are descendantsfrom countries in these regions.The term Hispanic does not includerace as a factor, Hispanics includepeople who may have whiteEuropean features as well as Afro-Caribbean features and indigenousfeatures.

Each country in Latin Americahas its own holidays, dialects andsocial, economic and politicalissues. The Hispanic community inthe United States is very diverseand most individuals will describethemselves not as Latinos, but asmembers of their country of origin(Mexican, Puerto Rican,Panamanian, Salvadoran, Cuban,Colombian).

Describing the Hispanic culture

More and more service providersare realizing that each countryincluded in the grouping of"Latino" or "Hispanic" has its own

What the HispanicPopulation Looks Like

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cultural traditions, festivals, andbeliefs. All of these beliefs and tra-ditions influence how peoplebelonging to this culture maketheir decisions, how they run theirhomes, and what they purchase.It’s important to understand thatprevious interactions in their homecountries, and their treatment in

the United States, influence howthey feel about and interact withfinancial institutions and publicservices like health care, the police,and schools.

The Hispanic community hasmany traits typical to the culturesof their original countries, some ofwhich were detailed in a survey

conducted in 2000 by YankelovichPartners. Nearly all of the peoplesurveyed were extremely proud tobe Latino. They believe that theyhave stronger family ties thanmost other Americans and that aperson's main responsibility is tothemselves and their family.

Other Hispanic cultural

CREDIT UNIONS SERVING HISPANICS: A NATIONAL PERSPECTIVE 6

In the past 10 years, the Latino community in theUnited States has doubled in size and become a majornational influence in everything from music to food,clothes, books, and movies. The Latino community hasincreased in size and scope--in areas such as theMidwest, where it previously had a minimal impact—tobecome a significant influence in both the public andprivate sectors. As a result, more and more businessesare finding it important to have fluent bilingual Spanish-English speakers. Businesses are also realizing the needfor cultural translators, people who are not only bilin-gual, but bicultural. Those individuals can provide creditunions and other service-providers with more insight tobetter methods for reaching and improving servicesoffered to the Latino community (Figure 1).

Since 1990, the Latino population in the United Statescoming from Central or South America grew 5.6%,while the percentages of people originating fromMexico, Puerto Rico, orCuba decreased slightly.Mexicans still comprisethe vast majority of theHispanic community(more than half).

Latinos of Mexicanorigin live mostly in theWest and the South,Puerto Ricans in theNortheast, and Cubansin the South. MostCentral and SouthAmericans live almostequally in the Northeast,the South, and the West.For example, Hispanicsmake up 30% of thepopulation in California.California has a large

population of immigrant Mexicans as well as a growingmiddle-class of Mexican-Americans. The number ofHispanics from El Salvador and Guatemala in Californiahas also increased.

In Texas, the majority of Hispanics are of Mexican ori-gin, but don't associate themselves with their Mexican-American neighbors in California. Instead, they claim aculture all their own. Like California, places such asHouston are seeing an increase in Guatemalan immi-grants.

In Chicago, the largest percentage of Latinos is ofPuerto Rican descent, although Chicago has a largeMexican population as well.

Puerto Ricans also represent a large percentage ofthe Latinos in New York. However, the percentage ofimmigrants from the Dominican Republic, Colombia, andCuba has increased significantly in New York.

In Miami, Cubans make up a large percentage of theHispanic and of thecity's total population.Miami also has a grow-ing number ofNicaraguans andColombians, Peruvians,and other SouthAmericans.

Credit unions nation-wide need to evaluatethe Hispanic market.While Latinos in theUnited States are stilllargely concentrated instates such as Californiaand Texas, the Latinopopulation in midwest-ern states has doubledsince 1990.

Other Hispanic 6.5

Cuban 3.7

Puerto Rican 8.6

Central andSouth American 14.3

Mexican 66.9

Figure 1Hispanics by Origin: 2002(In percent)

Source: U.S. Census Bureau, Annual Demographic Supplement to theMarch 2002 Current Population Survey.

Growth of the Hispanic Population

Less than 5% 5%-12%

25%-42% 13%-20%

distinctions are:• Hispanic cultures

avoid uncertainty andambiguity by nottolerating ideas andbehaviors that goagainst their popularbeliefs and norms. Thisphilosophy carries intobuying trends. In manyways, Hispanic con-sumers are much morelikely to endorseupward status ormobility, making themvery brand and trendconscious.

• In most Latino cul-tures, people will avoidmaking decisions with-out consensus. Often aLatino individual maygive a response theybelieve someone isexpecting, rather thanrisk stating an opinionthat may be contradic-tory. This tendency isespecially true whendealing with an unfa-miliar or more educatedperson.

• The concept ofsaving face is also veryprominent. In manycases, Latinos wouldrather risk not com-pletely understanding somethingthan risk looking uneducated oruninformed. It is imperative forcredit unions to take the extra stepto make sure information is bothclear and understood.

• Because most Hispanics in theUnited States come from countriesthat lack trust in government insti-tutions or where voicing opinionscarries serious consequences, theyare more likely to believe that

power and authority are facts oflife. Hispanics are also more likelyto accept that people are not equaland, in most cases, do not believethat class situations can be sur-passed.

• Another factor very importantfor credit unions to understand isthat, as a culture, Latinos are morefocused on the present than thefuture. Their needs are more imme-diate. They are more focused on

day-to-day living.This affects attitudestoward saving moneyand planning foreducation or otherfuture expenses.

• Recognize thatfacial expressions orgestures are muchmore common com-munication tools inmost Hispanic cul-tures. In their culture,people tend to havesimilar experiences,belief systems, andcommon understand-ing of class and edu-cational differences.There is less need forexplicit communica-tion within the cul-ture. In the UnitedStates most peopleand businesses putmore emphasis onmore elaborate com-munication.

Considering thesecultural differences,Latinos will have dif-ferent expectationsfor their interactionswith credit unions. Tobuild a better rela-tionship with theHispanic community,

it is important that credit unionsunderstand not only the Spanishlanguage, but all of these culturalaspects as well.

Of course, there are many vari-ances and exceptions in theHispanic culture. This informationis to give credit unions a betterbackground and understanding ofHispanic cultures, but should by nomeans be considered the onlyinformation source.

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Less than 5% 5%-12%

25%-42% 13%-20%

Figure 3U.S. Hispanic/Latino Population: 2000

13.3

20.5

7.7

27.0

34.8

33.3

44.2

19.2

Non-Hispanic White

Hispanic

West

South

Midwest

Northeast

Figure 2Population by Hispanic Origin and Region of Residence: 2002(as a percent of each population)

Source: U.S. Census Bureau, Annual Demographic Supplement to theMarch 2002 Current Population Survey.

Source: U.S. Census Bureau

Identifying the Hispanic market segments

According to David Grace, of theWorld Council of Credit Unions Inc.(WOCCU), three important targetmarkets are described.

• Target market one: recentimmigrants. This market includesLatinos living in the United Statesfor one or two years. Better thanfour of ten (44%) in this marketare without financial services. Theyneed materials in Spanish. Thismarket group has a lower incomethan does the average American.

• Target market two: long-termimmigrants. This group is com-prised of Hispanic people whohave been living in the UnitedStates for about 20 years. Thisgroup speaks Spanish—and limitedEnglish—but may not be able towrite it. This market does not nec-essarily need materials written inSpanish.

• Target market three: Hispanicheritage. This group may or maynot speak Spanish, but they con-duct their business in English.

For most credit unions, reachingthe first two markets is most diffi-cult and the reason for informa-tional guides such as this one.

Avoiding stereotypes in America

Webster's New CollegiateDictionary defines stereotype as "astandardized mental picture that isheld in common by members of agroup and that represents an over-simplified opinion, affective atti-tude, or uncritical judgment."

Often people fail to recognizetheir own behavior as stereotyping.However, every person is guilty ofstereotyping others, whether theybe members of a particular ethnicgroup, such as Hispanic, those whobelong to a specific religiousgroup, University students, busi-nessmen, the elderly, single par-ents, or blondes.

Stereotypes will always exist,but they can be dangerous if theyaffect how we treat one another orif they take the place of actualfact. Especially after the Sept. 11

attack on America, there has beena large nationalist movement thatputs anything that is not main-stream in danger of being criti-cized, ridiculed, and subject toprejudicial treatment.

Foreigners: For example, one ofthe main stereotypes is that allLatinos are foreigners. People maythink that Spanish names aresomehow not American. In fact,many cities and other places havenames of Spanish origin like LosAngeles and Santa Fe. Additionally,many long-standing Irish, German,and French names are now consid-ered American.

Recent immigrants: Anotherstereotype is that all Hispanics arerecent immigrants, even thoughthe latest United States censusshows three out of five Latinos areborn here. Some of the oldest set-tlements in this country are ofHispanic origin. In fact, one of theoldest cities under the Americanflag is San Juan, Puerto Rico.

No economic benefit: The ideaof people being foreign may also

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The Hispanic population in the United States is veryyoung. The median age of Hispanics (25.8) is more thana decade younger than that of white, non-Hispanics(38.6), according to an American Demographics analy-sis of Census 2000 data (Figure I). Nearly half of allHispanics are younger than age 25.

Between the 1990 and 2000 censuses, the growth inHispanic youth age 15 to 29 years increased 54%,while the white, non-Hispanic population of the sameage decreased 11%. More telling is the growth differen-tial for children age 0 to 14, where Hispanics grew 62%and white, non-Hispanics decreased 9.5%. Because theHispanic population is so heavily weighted toward theyoung, credit unions should expect a prolonged trend ofincreased Hispanic influence in popular culture, theeconomy, and public life.

Hispanic Age Groups

Baby boomers(35-54)23.4%

Generation X(25-34)18.4%

Generation Y(5-24)37.9%

Generation Z(under age 5)10.5%

Seniors(65 and older)5.0%

Empty nesters(55-64)4.8%

Figure I35.5 Million Hispanic Americans

Source: American Demographics

lead to the stereotypicalbelief that foreignershave no stake in this sys-tem and therefore do notcontribute to buildingthe country. Contrary topopular belief, immi-grants contribute muchmore to the UnitedStates economy than thebenefits they receive.According to theNational Academy ofSciences, the averageimmigrant contributes$1,800 more in taxesthan he or she receives inbenefits. The federal gov-ernment receives approx-imately two-thirds ofimmigrant tax dollars.However, state and local govern-ments provide the bulk of servicesimmigrants use, including educa-tion, health, and public assistance.As a result, states and localities areoften left with the task of provid-ing services without sufficient rev-enue.

Job stealers: A more recentprejudicial belief is that foreignerscome to America to take jobs awayfrom 'real' Americans. It's a myththat immigrant workers take jobsaway from native workers.Immigrants usually take jobs thatother people don't want. Mexicanworkers have also been intermit-tently welcomed in this country.During World War I, the UnitedStates encouraged Mexican work-ers to work here to offset wartimelabor shortages. Then, during theGreat Depression, our governmentdeported approximately one-halfmillion people to Mexico, many ofwhom were American citizens. Thesame practice occurred duringWorld War II.

Illegal immigrants: Another

misconception about immigrants inthe United States is that they allcome illegally through the Mexicanborder. Most immigrants here enterlegally with visas. Those who areillegal usually enter with visas andthen overstay them, or come across the relatively unregulatedCanadian border. Nearly half of allHispanics live in central citieswithin a metropolitan area.

Spanish-speaking only: Anotherstereotype is the belief that allHispanics can only speak Spanish.According to the 2000 YankelovichPartners study, 64% of theHispanics surveyed consideredthemselves Spanish language dom-inant, 21% used English andSpanish equally, and 15% wereEnglish language dominant. Whilemost Hispanics use Spanish astheir first language, they may beoffended when others wronglyassume that they do not speakEnglish.

Associative stereotypes: Alongwith these misconceptions arecommon associative stereotypes.

For example, thatincludes ideas such as"all Mexicans eat tacos"and "eat spicy foods andlove beans." Ideas such asthese diminish the varietyand diversity of Hispaniccultures. It also diminish-es the importance andvalidity of their cultures,reducing a multi-leveled,complex culture into asimple stereotype. Thinkof it this way: There's apopular European beliefthat all Americans eatMcDonald's every day.

These types of stereo-types are seen in adver-tising or marketing whenbusinesses use stereotyp-

ical images about Hispanics, likesombreros, in their promotionalmaterials. Rather than encouragingthe Latino community to use aproduct or service, such advertisingfeeds biases and reinforces dis-crimination.

Recognizing the new AmericaCredit unions have the opportu-

nity to become leaders in providingfinancial services to the fastestgrowing segment of the country.It’s important to understand cul-ture, trends, needs, and differencesin the community so that yourcredit union can best serve thisimportant, growing segment of thenew America that has emerged inthe past decade.

The United States is a country ofimmigrants and few people canclaim to be truly American. Nearlyeveryone here is a descendant ofimmigrants. No matter where yourcountry of origin or for what rea-son your ancestors came here,immigrants founded this country.With immigrants arriving still every

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day, this rich heritage continues.Compared to the percentage ofpeople born outside of the UnitedStates in 1870(14%) or in 1910(14.7%), today'simmigration levelsaccount for about11% of the popu-lation.

The Hispaniccommunity isexperiencing a dif-ferent process ofacculturation thanthe immigrants ofthe 19th century.In the past, immi-grants faced an imperative assimi-lation to survive. Today's immi-grants, however, are not limited tothe choices or opportunities pre-sented by the American meltingpot of the past. It is no longer nec-essary for immigrants to sacrificetheir cultures and language.Maintaining their culture ratherthan assimilating to the dominantculture greatly affects their finan-cial needs and the services creditunions provide the Latino commu-nity.

In the United States today, there is a dominant culture, andmany co-cultures. In the past, thedominant culture established thenorms and standards for society.But starting with the civil rightsmovements of the 1950s and '60s,these norms have been increasing-ly influenced by other co-cultures.

The United States is experiencingLatinization as Jorge Ramos calls itin his book, "The Other Face ofAmerica." America is no longer acountry made of whites. It is amulti-cultural and multi-racial nation.

As long as there are jobs in theUnited States and unemployedworkers in other countries, immi-

grants will continue to come here-legally and illegally. Here a mini-mum-wage worker can make in

one hour what itwould take him orher one or twodays to earn inMexico, ElSalvador, orNicaragua.

It’s ironic that acountry founded byimmigrants, strug-gles to embracethe new wave ofimmigration. As theHispanic communi-ty grows, America

will face problems caused bystereotypes, racism, and cross-cul-tural misunderstandings.

While many businesses andcommunity leaders have expressedpositive support of the growing

Latino community, there has beenopposition by a group called theAmericans for ImmigrationMoratorium which campaigns formore strict immigration laws.

As anti-immigrant groupsemerge, more immigrant-advocacygroups develop as well, such as theImmigrants Support Network orthe Lutheran Immigration andRefugee Service. Communities andschools are also becominginvolved, providing public educa-tion campaigns about immigrantsand the Hispanic community. Thetelevision media is also involved in numerous public service cam-paigns and documentaries, such as "The New America" on PBS. Thenew America is not a melting pot,but as some groups are calling it, a salad tossed full of differentingredients that contribute to itsbeauty and appeal.

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ResourcesThe content provided in this segment includes information from the following sources:• The Hispanic Population in the United States:

March 2002, issued June 2003, U.S. Census Bureau• The Hispanic Population, Census 2000 Brief,

issued May 2001, U.S. Census Bureau• Hispanic Market Secondary Research Executive Summary,

May 2003, Pam Schnagl, CUNA Mutual Group• David Grace, World Council of Credit Unions Inc.• Hispanic Agenda for Action (HAA), Office of Minority Health,

U.S. Department of Health and Human Services, Washington, D.C., more information can be found at www.haa.omhrc.gov

• The “Other Face of America,” Jorge Ramos, HarperCollinsPublishers Inc., 10 East 53rd Street, New York, NY 10022

• The NewsHour with Jim Lehrer, February 16, 1998,MacNeil/Lehrer Productions transcript can be found at www.pbs.org/newshour

• The City/La Ciudad, PBS documentary series, moreinformation can be found at www.pbs.org/itvs/thecity

• Hispano Mundo, www.hispanomundo.com

• For a list of Hispanic events, go to www.aviso.net/dir/usa/hispanic/

events

In 10 years, the Latinocommunity

has doubled.