A Latino impact on the financial industry

Financial institutions are a fantastic business model to learn from when considering changing market conditions. Its traditional target markets are stable, but due to the needs of an emerging market, the Latin market is extremely underserved. It is certainly not for lack of money. Many Latinos have zero debt and healthy savings habits. The question arises: are financial institutions doing enough to serve this population? Are they adapting to Latino needs? The answer is complicated.

There are two types of Latinos in the United States. You are the immigrant looking for a better life and wanting the American dream, whether he came through the right channels or not is irrelevant. The second is the Latinos who are born here. These are two very different groups of people with different needs and goals. Most immigrants bring their culture, traditions, and customs to the US Those born here develop a mixed culture that is both Latino and American.

Financial institutions are taking notice and taking great strides to adapt to this economically influential population. The main reason is that there is a lot of investment in education and trust development. An incalculable detail is that in Latin countries, people do not trust banks and financial institutions due to corruption. Everything is paid for in cash and there are no traditional debts or credit scores. This means that the Latino community has cash, probably kept under your mattress or in a shoe box. This is very dangerous considering that a house fire could burn a lifetime’s savings. Another scenario is that they could become a target for theft. This is a strange concept for Americans. What is happening is a huge learning curve, educating them about the process of building credit, saving their money at a financial institution, getting loans (mortgage, car, etc.), and most importantly, having confidence in financial institutions. .

The younger generations born here learn from their parents and their environment. There is still a disconnect from the importance of financial products, credit building, and how that process works. Many of these young people are only translating for their parents, explaining financial products and becoming intermediaries to conduct business. You will notice an increase in bilingual support at many financial institutions for this reason. There is still much work to be done in this regard and this process will take time.

However, more and more financial institutions offer specific products for Latinos. Information is available in Spanish and more financial institutions are hiring bilingual and multilingual speakers. It will be interesting to see how we, as a country, adapt to this important demographic. It is truly an untapped market that plays an important role in our economy for growth and stability.

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