Customers’ new division focuses on underserved
It’s not unusual for a bank to employ a multicultural officer or lender on staff. Customers Bank isn’t stopping at one person though.
The West Reading-headquartered financial institution put together an entire team dedicated to working with underserved communities.
Customers Bank introduced its multicultural banking group in January 2020 with a vision of expanding access to capital for small and minority-owned businesses.
What that means, exactly, is providing economic opportunities for potential borrowers who might otherwise go overlooked by banks, explained Miguel Alban, senior vice president and director of multicultural banking at Customers Bank.
“It’s the right thing to do,” Alban said. “But also we see this is going to be the future of opportunity for a financial institutions.”
Alban possesses 15 years experience in multicultural banking, so he recognizes the need in many communities, not only for expanded access to banking services, but to commercial lending in particular.
The idea is to be more inclusive, both in service of building stronger businesses and communities while simultaneously finding bringing in new accounts to the bank.
“We don’t exclude or limit,” Alban said. “We have a lot of clients who are white, but our intention was to reach out to these minority-owned markets and businesses in a way nobody has in the past.”
What does a multicultural banking division do?
At its most basic level, the goal of Customers Bank’s multicultural group is to provide loans and other financial services to business owners who might not qualify at another bank, or didn’t even know where to begin.
Maybe the business is successful but the owner is based in a
low-income area and lacks collateral. Or perhaps there is a language barrier that makes filling out the paperwork or understanding the process seem daunting.
Customers Bank just wants to level the playing field.
“For many, many years, they’re being left out,” Alban said. “Nobody gives them a hand. Nobody supports them gives them or gives them an opportunity to grow. These businesses just need a little push.”
Alban pointed to local success stories to demonstrate examples of how the bank’s program works.
“We helped a lot of small businesses achieve their dreams of expanding,” Alban said. “Commercial property purchases, businesses that have been renting for years and years, now they have a chance to own the building.
“We recently helped an auto body shop in Reading. This guy was renting forever, then got the opportunity to buy the building he was in. He went to other banks, they said, ‘No,’ for X reasons. We saw that this is a Latino man, he has a clientele, he has a story, we’re gonna make it work. Now he’s not renting anymore.”
The group has also done a lot of the heavy lifting behind making Customers Bank No. 5 in the
nation for providing PPP loans during the coronavirus pandemic, partnering with nonprofits and CDIFs to ensure small lenders are getting a fair shot.
With an average PPP loan size of $22,000 at Customers, Alban believes it’s proof the money is generally going where it’s needed most.
“When your average loan size is $22,000 and you’ve done over 100,000 loans, that just says how we care about people.”
‘Do the right things ... get the right results’
A huge aspect of multicultural banking, of course, is not only helping people who deserve an opportunity who might not otherwise get it, but humanizing them as well.
“On the team we have African American lenders, Hispanic lenders, we have a lender from India,” Alban said. “So when we meet with these customers, we try to meet from the cultural perspective.
“I like to say every credit has a story. We need to understand each business and not put them all in one bag.”
Yet, there’s also a strong belief at Customers Bank that doing good in communities and doing
good business will inevitably intersect.
Creating more economic prosperity for underserved and minority business owners is a way to strengthen families, neighborhoods while simultaneously reducing inequities in society. From the perspective of a financial institution though, it’s also sound strategy.
“If we do not reach out to these segments right now, we’re gonna lose them,” Alban said. “These markets are very loyal and it’s gonna be too late. They’ll already be with another bank.”
That’s why Customers Bank is looking at expanding the division’s presence in other markets — likely New York City and Boston first, but eventually in Florida and Texas as well.
Alban says it’s important to pay attention to these multicultural groups wherever they are, because when everybody succeeds, the opportunities will ultimately flow both ways.
“They might be saying, ‘I’m profitable, I’m ready to open a second shop, to buy a house, to grow, and this is the bank,’” Alban said.
“Everything else will come along. We believe if we do the right things for the right reasons, we will eventually get the right results.”