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A Matter of Dignity
Recently a friend shared a recent banking experience. My friend, Clara, is an undocumented worker who makes her living cleaning houses. Her current employer is a wealthy woman with an 8 bedroom mansion in an exclusive suburb in Silicon Valley.
Her employer recently paid her by check before leaving town. Clara and her co-worker, the other cleaning woman (it takes two women to clean this house every week), went to the local bank from which the check was drawn thinking that would be the most efficient way to get their money.
The teller asked for a social security card and a drivers license. Having neither, Clara presented her Matricula consular and credit cards. The teller, apparently unfamiliar with the Matricula called up on the branch manager. The branch manager then instructed the teller that the check could be cashed upon two conditions - that Clara be photographed and her full fingerprints taken.
When I heard this story I was taken aback. All that was lacking was the number held up to her chest to make it a full mugshot. All to cash an $80 check.
Often, experts wonder why immigrants refuse or are reluctant to engage with banks. Are they ignorant? Are they financially illiterate? Don't they know that check cashing facilities exploit them?
Perhaps they behave the way they do to avoid the humiliation.
I read in Business Week a while ago that undocumented hispanic people are a target market for the mortgage industry. And the matricula card that you mentioned was cited as an acceptable ID to purchase mortgages.
So I suppose policies vary by bank, by region and by the type of financial service.
Having once been a Chinese immigrant (I think I'm pretty well assimilated by now), I am surprised that you friend even accepted a check, went to the bank and presented her various forms of ID. It used to be that new Chinese immigrants, documented or not, would never engage with the establishment, remembering what woe can befall them for invoking the establishment 'back home.'
Felipe,
as a matter of fact, the market will sort this out. As a result of working on Indigo and learning more about the banking problems of people like Clara, I and my co-founders have started a new enterprise called m-Via, which allows for crossborder payments and peer to peer money transfer through a DEBIT card and cell phone. We use a debit card because many people like Clara don't have credit.
m-Via is creating a service mark (look on the back of your ATM card - you'll see Star, Maestro, Cirrus) that mobile enables existing debit cards and creates private label debit cards for MVNOS, retailers and civil society organizations (like hometown associations, church groups, MFIs, etc.) that want to provide financial services to their existing customers.
Unlike other money transfer products like Western Union, etc. m-Via enabled debit cards are compatible with each other - you could send money from your Wells Fargo m-Via card to a Citibank m-Via card or to your hometown association m-Via card.
And unlike other money transfer operators, you can transfer money from the privacy of your cell phone. You look up your friend or family member, enter the amount to be sent, enter your pin number and m-Via sends a message to the recipient informing them that you have sent them money. The money is instantly transferred to their card. All for a flat fee.
Since it is also a regular debit card, you can use your m-Via enabled debit card to withdraw cash from any ATM in the world.
You can use your debit card to make purchases at stores or online. Previously, the unbanked didn't have a way to make online purchases - you typically needed a credit card. Online retailers do accept debit cards but don't accept cash.
Your employer can direcrt deposit your paycheck to your debit card, avoiding the need for checks or check cashing facilities.
Margarita Quihuis
Co-Founder, m-Via
Founder, www.indigofinanciera.com
Co-Founder, TechPlaza Ventures, www.techplaza.typepad.com
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