51 Wisconsin Credit Unions Get OK on Check Cashing Licenses

MADISON, Wis. – Reflecting apparent new interest in check cashing services to aid the unbanked, 51 Wisconsin credit unions now have authority from the state’s Office of Credit Unions to offer such services to non-members. Of the 51, the Wisconsin Credit Union League estimates only about 20 are now offering the service in a follow-up to social awareness pitches pushed forward in recent months by the League and the Filene Research Institute. For more than a year now, Filene has been conducting a pilot program of check cashing CU outlets in seven states including Wisconsin to demonstrate ways CUs can help combat payday loan outlets while also gaining new memberships for CUs. Filene says there are now 19 locations across the U.S. that are part of its pilot project. James Drogue, vice president of operations for the Wisconsin League, said the 51 Wisconsin CUs with check cashing powers shows the attention paid by CUs in the state toward reaching out to low-income individuals through check cashing services. He said check cashing was a topic at the League’s annual meeting last May at which Filene representatives urged CUs to “build relationships” with consumers who have turned to payday outlets. Acknowledging check cashing “is not a real profit center,” the facilities offer an opportunity to “bring new members into the fold,” said Drogue. In a related development, the $285 million CUNA Credit Union of Madison said it will begin offering check cashing “in a month” and is making plans to debut a payroll card and “an alternative product to payday loans” perhaps in July, said Kim Sponem, president and CEO. “We would be the first in our market to offer a payroll card,” she said, noting the decision to offer the product emanated from a two-day board planning session last September where attendees expressed their opinion that the Wisconsin CU should be more responsive to serve individuals “of modest means.” Directors of CUNA CU Board include top and middle managers at CUNA and CUNA Mutual. Among them is Bill Hampel, CUNA’s chief economist. Ginger Larson, supervising examiner with the Wisconsin Office of CUs, acknowledged some new entries into check cashing “which have occurred over the last six months” but added “I wouldn’t call it a rush.” “We have a few credit unions who have had the authority for years,” Larson concluded. -