EMBA capstone becomes real-world business plan: providing financial services to the underserved

Jeff Ivey and EMBA teamThe capstone project marks the end of the EMBA experience–unless the business idea is put into play, which happened for a team from the class of 2017.

Taking an idea from Jeff Ivey, a team consisting of Marilyn Romano, Tobi Crabtree, Evan Thomas, Diana Shalabi, and JP Zbylut was put together to work on how to better reach and serve the financially underserved and unbanked households in a market, and how to combat the proliferation of payday lenders and other predatory companies that rip these individuals and families off.  “As the only ‘banker’ in the group, I knew I needed a broad perspective of different experiences in order to develop a solid plan,” said Jeff. “This team provided exactly that.”

Each team member brought a different vantage point to the plan. In addition to published research, Tobi and JP actually stood outside a payday lender and surveyed people that went in, basically asking them why they were using a payday lender. Evan and Marilyn visited with local non-profits that served individuals that were struggling financially, and operating outside of the mainstream financial system. Diana pored through volumes of research and statistical data to assist in developing an approach that made financial sense, while Jeff documented his 25+ years in the industry with examples of why banks do not focus on these individuals and families, and what the economic reality would be for a bank or credit union that did make that their mission.

Not long after graduation, Jeff accepted the position of President/CEO of River City Federal Credit Union in San Antonio, a company that was in dire need of a financial turnaround. Approximately 12% of the 1.9 million people in San Antonio are financially underserved or unbanked, and the opportunity to put the business plan into place made this an easy decision for Jeff. The credit union’s mission statement was changed to “We believe that everyone has a basic right to affordable, sensible financial products, regardless of citizenship status,” and the results speak for themselves. The credit union is having its best year in, well, forever, has gained recognition by the City of San Antonio and the National Credit Union Association for its mission and strategic plan, and most importantly is making a bigger impact with its members. Jeff reports that “one of our staff relayed a story to me yesterday about a loan we just did. They called over to one of the numerous payday lenders in our city to get a payoff. The person at the lender said ‘River City? You guys keep paying us off and taking our customers.’ That is absolutely music to my ears. I think about the business plan our team wrote as part of the capstone project every day, and we’re definitely putting it to good use. And it never would have happened without the team that worked on it at UW. People that find themselves in financially challenging situations just need someone to work with them, and for too long our industry has been ‘strike one and you’re out’. We are changing that.”