ConnectHome Nation Webinar Using the Community Reinvestment Act to - - PowerPoint PPT Presentation
ConnectHome Nation Webinar Using the Community Reinvestment Act to Close the Digital Divide Presenters : Jordana Barton, Senior Advisor, Federal Reserve Bank of Dallas Yolanda Davila, Texas Community Relations Executive, BBVA September 26, 2017
September 26, 2017
Presenters: Jordana Barton, Senior Advisor, Federal Reserve Bank of Dallas Yolanda Davila, Texas Community Relations Executive, BBVA
What is CRA? Digital Divide Best Practices The Case Opportunity Case Study Role of Banks
“Closing the Digital Divide: A Framework for Meeting CRA Obligations”
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What is CRA? Digital Divide Best Practices The Case Opportunity Case Study Role of Banks
▪ A law that encourages banks to make loans and investments and provide services in low- and moderate-income (LMI) communities. ▪ Passed in the 1970’s to address redlining—the denial of credit to individuals based on where they live. ▪ Lending, Service, and Investment Tests. ▪ Intended to be broad, flexible and responsive to changes within communities. ▪ Every year CRA helps bring over $100 billion in capital to LMI communities across the country.
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What is CRA? Digital Divide Best Practices The Case Opportunity Case Study Role of Banks
▪ Broadband is included as a form of infrastructure investment—an essential community service. ▪ Under the CRA service test, banks should show evidence that their “alternative delivery systems” using online banking and financial technology are being adopted and are effective in providing services to LMI individuals. ▪ Economic development: ➢Workforce Development, already an integral part of CRA; added workforce development/job training examples. ➢Small Business Development, already an integral part of CRA; added an example of supporting technical assistance for businesses in the use of technology.
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What is CRA? Digital Divide Best Practices The Case Opportunity Case Study Role of Banks
▪ Essential Infrastructure ▪ Workforce Development and Education ▪ Access to Financial Services ▪ Small Business Development ▪ Affordable Housing ▪ Health Care
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What is CRA? Digital Divide Best Practices The Case Opportunity Case Study Role of Banks
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What is CRA? Digital Divide Best Practices The Case Opportunity Case Study Role of Banks
▪ Digital skills & access to broadband required for accessing jobs & training. ▪ 70% of jobs are posted online. ▪ Job training programs increasingly offered online. ▪ 8 in 10 middle skills jobs require digital skills (32% of labor market demand). ▪ Digitally intensive middle skills jobs have grown twice as fast as other middle skills jobs in the past decade (higher wages). ▪ The skills mismatch in the expanding digital economy.
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What is CRA? Digital Divide Best Practices The Case Opportunity Case Study Role of Banks
▪ 1/3 of households with incomes below $50,000, with school age children, do not have high speed internet access at home (40% of all families with school-age children). ▪ Only 8% of households with incomes of $50,000
at home.
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What is CRA? Digital Divide Best Practices The Case Opportunity Case Study Role of Banks
Reserve System, 2016).
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What is CRA? Digital Divide Best Practices The Case Opportunity Case Study Role of Banks
2016)
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What is CRA? Digital Divide Best Practices The Case Opportunity Case Study Role of Banks
To achieve success, it is critical to invest in community programs that include all of the “three legs of the stool”
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What is CRA? Digital Divide Best Practices The Case Opportunity Case Study Role of Banks
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What is CRA? Digital Divide Best Practices The Case Opportunity Case Study Role of Banks
▪ When there is an opportunity, banks can blend or layer the types of investments they make in broadband to include the “three legs of the stool”. ▪ Measure outcomes to identify what works. ▪ Digital inclusion programs need to consider the barriers to adoption people experience. ▪ Training programs for youth and adults should cover the subject of internet safety and security. ▪ Communities should consider the internet speed that will meet their economic development goals. ▪ Local governments should create their digital inclusion plans as part
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What is CRA? Digital Divide Best Practices The Case Opportunity Case Study Role of Banks
Part four of the new publication includes: ▪ Helpful tips on preparing your case ▪ A overview of critical sections of the CRA Q&A ▪ A list of CRA Reference Guides
Source: “Closing the Digital Divide: A Framework for Meeting CRA Obligations”
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What is CRA? Digital Divide Best Practices The Case Opportunity Case Study Role of Banks
Part five is a template your financial institution can use to tailor its own community development story and recognize ways to demonstrate leadership, responsiveness, and innovation.
Source: “Closing the Digital Divide: A Framework for Meeting CRA Obligations”
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What is CRA? Digital Divide Best Practices The Case Opportunity Case Study Role of Banks
Understanding the “Performance Context”: What are some ongoing projects to close the digital divide in the community?
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What is CRA? Digital Divide Best Practices The Case Opportunity Case Study Role of Banks
The likelihood that a household has a broadband connection varies greatly depending upon its location.
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What is CRA? Digital Divide Best Practices The Case Opportunity Case Study Role of Banks
Of the 381 metropolitan areas in the U.S., those with the lowest rates of computer
Internet use include three Texas border metro areas.
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What is CRA? Digital Divide Best Practices The Case Opportunity Case Study Role of Banks
▪ A community-led initiative to design and implement an effective replicable model for closing the digital divide in the Rio Grande Valley on the South Texas Border. ▪ A middle mile, inter-governmental network demonstration project with Pharr-San Juan-Alamo School District (PSJA) and the City of Pharr. ▪ A digital inclusion program at PSJA for parents and students. ▪ 2017-Two new ConnectHome PHA’s
DO4RGV
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What is CRA? Digital Divide Best Practices The Case Opportunity Case Study Role of Banks
▪ Improve educational opportunity and results for Pre-K through 12 grade students and their families across the Rio Grande Valley region (close the "homework divide"). ▪ Improve access to workforce
and job opportunities. ▪ Improve access to healthcare and telehealth/telemedicine.
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What is CRA? Digital Divide Best Practices The Case Opportunity Case Study Role of Banks
▪ Improve access to the Internet and
in the region and increase the ability to attract business. ▪ Improve access to financial services and online banking. ▪ Improve financial literacy through access to the BBVA Compass Financial Literacy Program including mobile and online banking. ▪ Develop a replicable model for expansion across the border region.
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What is CRA? Digital Divide Best Practices The Case Opportunity Case Study Role of Banks
▪ Studied impact of internet access on unbanked & underbanked low-income consumers ▪ Internet access has the potential to increase the number individuals with a bank account by 10% ▪ 2013 FDIC National Survey: 50% of unbanked households do not have internet access
Source: Technology, Opportunity & Access: Understanding Financial Inclusion in the U.S.
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What is CRA? Digital Divide Best Practices The Case Opportunity Case Study Role of Banks
▪ Test ways BBVA Compass can make an impact on financial health of the unbanked and underserved communities ▪ Using internet access & mobile technology ▪ Maintain affordability w/o compromise in quality or convenience
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What is CRA? Digital Divide Best Practices The Case Opportunity Case Study Role of Banks
▪ Launched July 2016 ▪ Austin, TX ▪ Riverside, CA ▪ Birmingham, AL
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What is CRA? Digital Divide Best Practices The Case Opportunity Case Study Role of Banks
▪ Bilingual curriculum ▪ Homebuyer ▪ Personal Finance ▪ Small Business ▪ 3 platforms for workshop delivery
workshop delivery
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What is CRA? Digital Divide Best Practices The Case Opportunity Case Study Role of Banks
Curriculum Overview
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What is CRA? Digital Divide Best Practices The Case Opportunity Case Study Role of Banks
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What is CRA? Digital Divide Best Practices The Case Opportunity Case Study Role of Banks
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What is CRA? Digital Divide Best Practices The Case Opportunity Case Study Role of Banks
▪ Income and wealth inequality are at the highest levels since the Great Depression. ▪ The Digital Divide creates a structural barrier to closing the income and wealth gaps—and a barrier to LMI individuals’ ability to move up the economic ladder. ▪ Investing in broadband infrastructure and digital inclusion can help us promote upward mobility and prevent downward mobility. ▪ By working with PHA’s, nonprofits, and other local partners to bring broadband access and adoption to LMI communities, banks can have a powerful impact on the “infrastructure of opportunity” in this country.
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September 26, 2017
Jordana Barton, Senior Advisor, Federal Reserve Bank of Dallas, Jordana.Barton@dal.frb.org Yolanda Davila, Texas Community Relations Executive, BBVA, yolanda.davila@bbva.com