Serving The Underserved Since 2011

A small Delaware credit union offers insights from its first decade of service.

 
 

A lot has changed for Stepping Stones Community Federal Credit Union ($4.3M, Wilmington, DE) in the years since local organizations banded together to form the cooperative.

The credit union, formed to serve city residents with limited income, received charter approval in October 2011. When CreditUnions.com profiled Stepping Stones in August 2012, it had $347,000 in assets and 115 members. After expanding more aggressively in the past three years, the organization now boasts more than $4 million in assets and serves more than 1,000 members.

A Mobile Approach

The credit union has reshaped itself over the years to serve its community’s distinct needs, and one of the drivers of Stepping Stones’ recent growth has been its proactive approach to community engagement

In 2018, Stepping Stones rolled out a mobile branch — a conversion van retrofitted by Discover and Barclays Bank — to provide a notable presence at community events, offer on-site account opening, and deliver the ultimate in convenience for members and organizations alike.

“The addition of our mobile branch has been tremendous,” says Blanche Jackson, CEO.

With the support of Discover and Barclays Bank, Stepping Stones Community FCU introduced a mobile branch in 2018.

What’s more, the mobile branch has been a vital resource during the past 18 months, allowing the Wilmington cooperative to safely operate throughout the pandemic.

“We parked the van across the street from the branch and did all of our transactions from there so members didn’t have to come inside the building,” Jackson says.

The side of the van opens like an ice cream truck, and members use the window for service. A computer and a card printer inside allow for easy account opening and instant issue ATM cards. The van also is outfitted with a firewall, a router, a virtual private network, and secure internet access; however, it doesn’t hold cash.

Digital And Lending Options

In addition to adding a mobile branch, the small credit union also has rapidly expanded its digital services. Stepping Stones now offers everything from home banking to bill pay, account-to-account transfers (A2A), and person-to-person payments (P2P).

“We had to evolve to serve the community,” Jackson says. “Now, we can meet them wherever they are, whether they want our digital services or want us to bring our van to a community event.”

Loan options have also expanded significantly. After its founding in 2011, Stepping Stones initially focused on payday lending alternatives, but today it offers signature loans, vehicle loans, and share-secured loans. It’s also launching a new mortgage program in late 2021 or early 2022.

“Our hope is to change renters into homeowners and help members who want to purchase a small-dollar home,”

Blanche Jackson, CEO, Stepping Stones Community FCU

“Our hope is to change renters into homeowners and help members who want to purchase a small-dollar home,” Jackson says.

Larger financial institutions might not be interested in smaller mortgages, but Stepping Stones plans to concentrate on them to serve residents of modest means.

Perhaps most impressive, the three-person credit union staffed by the CEO, a manager, and a volunteer board member/teller/mobile branch driver closed more than $3 million in Paycheck Protection Program loans last year.

Even large institutions struggled to navigate the program, and many focused solely on their larger customers; however, Stepping Stones took a different approach. It started with the second round of funding and focused on serving local non-profits and small businesses. Of the 46 PPP loans the cooperative made, 44 of them were less than $150,000. Still, these loans provided a lifeline to the self-employed and others in the community who might otherwise have missed out.

Many Supporters Make The Model Work

Stepping Stones provides most of its digital services through its core, VisiFi IPower. Non-member deposits from local banks, grants through the Delaware Community Reinvestment Action Council (DCRAC), and assistance from local organizations support the credit union’s operations.

For example, DCRAC received a grant from the CARES Act to purchase computers to help bridge the digital divide. DCRAC, in turn, supports Stepping Stones in its efforts to teach members how to use the cooperative’s digital services and provide computers for online banking and other needs, such as completing school forms and arranging for telehealth. Stepping Stones also formed a partnership with Comcast to offer members access to Comcast’s Internet Essentials program at a reasonable monthly cost.

CU QUICK FACTS

Stepping Stones Community FCU
Data as of 06.30.21

HQ: Wilmington, DE
ASSETS: $4.3M
MEMBERS: 1,068
BRANCHES: 1
12-MO SHARE GROWTH: 38.6%
12-MO LOAN GROWTH: 40.4%
ROA: 2.37%

In addition to the above support, this year marks the first year Stepping Stones received CDFI funding. The credit union was awarded grants for rapid response and training and technical assistance to help start its mortgage program and increase support staff.

Overall, Stepping Stones’ business model is to offer products and services its community needs, and it forms partnerships with organizations throughout the community to make that happen. According to Jackson, the cooperative wants to ensure anyone who wants to be banked can be banked without any barriers. Stepping Stones even funds the $5 membership fee for every account it opens.

Building On Community Partnerships

Although Stepping Stones does not have any of its own ATMs, it has partnerships with local banks and credit unions to offer members outsized convenience.

“We have relationships with WSFS Bank, Fulton Bank, and Dover FCU,” Jackson says. “Our members can use surcharge-free ATMs in Wawas and Royal Farms, which are plentiful in our area.”

Its partnerships with local organizations beyond these larger financial institutions also have attracted attention and members. Year-over-year membership growth was 33.5% as of June 30, 2021; loan growth was 40.4%. Jackson attributes much of this growth to the mobile branch.

“We started taking it to different events and developing our partnerships,” Jackson says. “Bringing the van to community groups has become the most frequent request we receive.”

And the credit union’s impact is growing as stories circulate of members struggling under payday loans with interest rates as high as 375% learning of Stepping Stones’ more affordable solutions.

“Even though we’re the smallest financial institution in Delaware, we strive to provide all the same services to our field of membership.”

Blanche Jackson, CEO, Stepping Stones Community FCU

As for the cooperative’s small team, a day in their life is both strikingly different and surprisingly similar to that of a larger credit union. They focus on ensuring current and potential members have access to fair financial services. And with the help of an independent, experienced credit committee, online loan applications, and e-signatures, the team often is able to provide loan decisions the same day or within 24-hours. The manager and CEO both work new member applications and typically can open them the same day with an instant issue ATM card; debit cards are on the horizon.

“I spend a lot of time developing partnerships and implementing projects that will benefit our members,” Jackson says. “Even though we’re the smallest financial institution in Delaware, we strive to provide all the same services to our field of membership.”