Transformational Deposits
Click Here to Learn More or to Make a Transformational Deposit
Traditional banks use low/no-cost checking and savings accounts to fund their lending activities. However, Hope Credit Union serves one of the nation’s most impoverished regions, a place from which wealth has been extracted for generations, and where families have limited ability to build savings and other assets. Consequently, HOPE’s ability to secure local deposits is constrained.
For example:
- HOPE is the only depository institution in Itta Bena, a small, majority Black Mississippi Delta town with a poverty rate of 42%, median household income of $20,400 and total community deposits of approximately $1.2 million. HOPE has approximately 58% of the local deposit market share – roughly $700,000.
- On average, an individual HOPE member has between $1,000-2,000 on deposit with HOPE. By comparison, American households with savings accounts have a median balance of $7,000 and an average balance of $30,600.
Consequently, HOPE must import capital into communities like Itta Bena to finance small businesses, housing, healthcare and other vital needs. Previously, this has been in the form of certificates of deposits, often from depositors seeking a high rate of return. As a result, HOPE’s overall cost of funds is 1% higher than banks and credit unions that operate in affluent markets, with ready access to low-cost checking and savings accounts.
To address this challenge, HOPE seeks to import $100 million in low-cost, federally insured Transformational Deposits into opportunity deserts across the Deep South.
| |
Share Certificate |
Money Market Account |
| Description |
Credit Union Equivalent of a Bank Certificate of Deposit |
Hybrid Checking and
Savings Account with up to
6 Withdrawals per Month |
| Minimum Deposit |
$1,000 |
$1,000 |
| Term |
12, 24, 36, or 60 Months |
Demand Deposit Account |
| Rate1 (APR/APY2) |
.10%/.10% |
.10%/.10% |
| Interest Earnings |
Paid Monthly, Quarterly, or Annually
Reinvested as Principal
Contributed to HOPE as a Tax-Deductible Donation |
| Federal Insurance |
Up to $250,000 Per Depositor |
Just five fully insured $250,000 Transformational Deposits would exceed the deposit base for entire towns like Itta Bena, fueling catalytic development in low-wealth communities. They also fortify HOPE’s ability to be a first-responder to help the underbanked navigate crises such as Hurricane Katrina, 2008 Financial Crisis and the COVID-19 pandemic.
Potential Transformational Depositors and Allies: Individual and Institutional depositors; Financial Advisors, Family Offices; Banks (with CRA benefit); foundations (with IRS benefit i.e. PRI); All who desire to Create Opportunity Where it is Needed Most.
You can see how your support makes a differences for families and communities across the Deep South by checking out our latest Impact Report or Quarterly Report. You may also want to learn more about other ways to support our work.
Download HOPE Transformational Deposits Brochure.
Click Here to Learn More or to Make a Transformational Deposit
1Rates subject to change.
2APY is Annual Percentage Yield.
