4 Credit Unions Join Together to Launch App for Unbanked
"Bank Dora" requires no minimum balance and charges no maintenance fees.
Four credit unions from Minnesota to Massachusetts have launched an app to provide free and completely online checking accounts to people who might otherwise have no banking services.
The name of the online service is Bank Dora Financial, or Dora for short, combining “bank” and cooperative-izing it by referring to credit union pioneer Dora Maxwell (1897-1985), who helped charter hundreds of U.S. credit unions.
The founding credit unions have $20.4 billion in assets and 1.6 million members. They are:
- Affinity Plus Federal Credit Union, Saint Paul, Minn. ($3.5 billion, 224,879 members)
- Digital Federal Credit Union, Marlborough, Mass. ($9.9 billion, 947,597 members)
- Service Federal Credit Union, Portsmouth, N.H. ($5 billion, 334,724 members)
- USALLIANCE Federal Credit Union, Rye, N.Y. ($2 billion, 127,699 members)
USALLIANCE is the smallest of the founding credit unions, but it appears to have a big role. The Dora Visa Debit Card is issued by USALLIANCE and Dora’s managing director is Kristi Kenworthy, whose LinkedIn page said she was appointed to the position in January after 12 years with USALLIANCE, most recently as an assistant vice president.
USALLLIANCE President/CEO Kris VanBeek announced Dora’s launch last week at the virtual conference of Inclusiv, a New York-based group that represents about 400 credit unions with some combination of Community Development Financial Institution, Minority Depository Institution or low-income designation.
In a news release sent out Wednesday the credit unions called Dora “the credit union industry’s first neo-bank strategy.”
“Intended specifically for low-to-moderate income individuals who are currently underserved by the traditional banking industry, Dora combines the best of fintech mobile applications with an affordable checking account to bring modernized banking to virtually, everyone,” the news release said.
The Dora Everyday Checking account features no minimum balance, no monthly maintenance fees, early payday with direct deposit, bill pay and a surcharge-free network of more than 30,000 ATMs nationwide. It is offered in English or Spanish.
Kenworthy said in the release that the credit unions “want to change how people think about access to affordable and fair financial services.”
“Fifty million Americans are not participating in mainstream banking services because of barriers to opening, distrust of the banking system, gaps in awareness, past history or lack of access — including the lack of a fully bilingual digital banking experience,” she said.
Kenworthy said for-profit neo-banks typically don’t cater to these individuals because their balances tend to be lower and their creditworthiness may take time to achieve.
“The credit union movement is really made for offering products at scale that are safe and affordable for them,” she said.
Dora said it continues to seek additional credit union partners.
Dora has been certified with Bank On National Account Standards, which identify critical product features for bank or credit union accounts appropriate to people outside of the mainstream banking system.