POLO ROCHA: A 55-year old construction worker named José is walking out of a check-cashing shop at a strip mall in northern Virginia. It’s a rainy Friday evening, and it’s busy here. I stopped him as he left and asked him about his bank.
JOSÉ: Sí, es el único problema, que no tienen personal que hable español, solo inglés.
ROCHA: José banks at PNC, and he tells me the only problem with his bank is that they don’t have Spanish-speaking staff. Only one staffer at his local PNC branch speaks Spanish – and even then, he speaks only a little.
JOSÉ: Solamente hay uno que sí habla un poquito, pero muy poco.
When he goes to his PNC branch, he’s connected to a translating service and gets help that way. But he says it’d be better to talk to someone in-person who’s bilingual.
JOSÉ: Es mejor que haiga una persona bilingüe.
ROCHA: José says it’s not a huge issue, and it’s more of an inconvenience. But consumer advocacy groups say his story is part of a bigger problem in the banking industry: language barriers force small business owners, homebuyers and other potential bank customers to borrow from more expensive lenders or to not do business at all. After the crisis in 2008, immigrants faced higher rates of foreclosure, which some attribute partly to language barriers that prevented homeowners from getting help.
Banks and their regulators are well aware of this problem, and they’re trying to fix it, especially with Spanish speakers. But why has it taken so long, and what more can the industry and the government do to tackle this issue?
From American Banker, I’m Polo Rocha, and this is Bankshot, a podcast about banks, finance and the world we live in.
ROCHA: Some 25 million people in the U.S. are not fully proficient in English. The vast majority of them speak Spanish, according to the Census Bureau, but many others speak different dialects of Chinese, Tagalog, Vietnamese, Arabic, French or Korean, to name a few. And across different parts of the country, Indigenous peoples speak their native languages at home.
In Rochester, New York, where Marlene Cortes lives, there’s a large number of people who speak Spanish, Somali, Arabic and Nepali. And it has one of the biggest deaf and hard of hearing populations in the country.
Cortes works at the Empire Justice Center, which gives legal assistance to consumers in New York State. She says some in her community just don’t feel comfortable at banks or understand their products – and so they go to check-cashers, where they can rack up fees just for cashing their paychecks or take out more expensive loans.
CORTES: The check cashers, they know their market. They know who comes through their doors. They know the demographics, so they know how to, how to communicate.
ROCHA: A recent study from the Roosevelt Institute, a progressive think tank, interviewed English and Spanish speakers at branches in California to see whether people were able to accomplish what they needed. The study found that 37% of Spanish-speaking visitors were turned away during their visit, compared to 15% for English speakers.
And a 2018 study from the Urban Institute found that limited English skills are linked to lower homeownership rates.
ED GOLDING: Having English as a second language was a significant factor and depressed the homeownership rate, more than we had expected.
That’s Ed Golding, a co-author of the study and the former head of the Federal Housing Administration. Golding, who now teaches at MIT, is a former executive at Freddie Mac. Nonbank lenders — think Rocket Mortgage or PennyMac — now account for most of the mortgages in the U.S. But traditional banks still have a big share of the market, and Golding has some ideas for how banks can help reduce these disparities.
GOLDING: It’s where you locate your branches. It’s who you hire to be the manager of that branch. It’s which media you advertise in. So there’s a lot of things that they could do in their day-to-day business strategy to focus on these communities.
ROCHA: The biggest banks in the country told me they’re working hard to help customers who speak in other languages. They said their mobile apps have Spanish language options, and that they’ve also translated their websites into Spanish.
PNC — that’s José’s bank — told me that its customer service team employs bilingual consultants in all areas of consumer servicing and that it has a dedicated call-center line for Spanish-speaking customers.
At branches, when PNC employees can’t provide in-language help — as in José’s case — PNC uses a service called LanguageLine, which has translators that specialize in banking.
PNC got praise for one aspect of its Spanish-language outreach at a House hearing last year. Democrat Sylvia Garcia asked about a PNC initiative where the bank basically turns buses into branches and parks them at different underbanked communities. The buses go to urban and rural areas, and they offer services in both English and Spanish. Here’s PNC CEO Bill Demchak at the hearing.
DEMCHAK: We have a fleet of mobile branches that is growing every day. And the financial economics make sense because it can cover multiple communities out of one — it’s fancier than RV — but out of one big truck.
ROCHA: At Bank of America, nearly 4.5 million customers say Spanish is their primary language. Almost 70% of its 3,900 branches have Spanish-language capabilities, including on-site marketing and Spanish-speaking employees.
And at JPMorgan Chase — the country’s biggest bank — its call center supports more than 100 languages, with non-Spanish language services being done with the help of an outside translation vendor. A spokesperson said that when a customer comes into a branch and requests a translator, the bank makes “every effort to accommodate them either in person or by phone.”
Like other banks, Chase translates its website into Spanish. But some of the promotional material on its Spanish home page remains in English — like a message alerting credit cardholders to a bonus they can get for referring friends, or a button that says a home lending advisor is ready to help customers explore their options.
The Chase spokesperson said that like other online experiences outside Chase, sometimes its content is “not fully available in Spanish and we display messages to alert customers that they will see it in English.”
I also talked to Rebeca Vargas, a top marketing executive at Wells Fargo whose division includes marketing to diverse populations and unbanked consumers. Vargas told me that reaching Spanish-speaking customers is a priority.
VARGAS: Even among those Latino consumers who are bilingual, or are English-dominant, even they appreciate when a bank or a corporation is able to serve their relatives and their community in Spanish.
ROCHA: Wells Fargo offers Spanish services in any basic consumer banking operation — at branches, on the phone, on its website, in its statements, or in its app.
And one reason why the bank is focused on Latino consumers lines up with what community groups have told me — that it’s an under-tapped and fast-growing market. The country’s Hispanic or Latino population rose from about 50 million in 2010 to 62 million in 2020. And it’s a highly entrepreneurial one — Hispanics own 1 in 4 of the new businesses in the U.S., according to a congressional report from 2021.
But Wells Fargo also wants to reduce the amount of people in the U.S. without a bank account. The numbers have improved, but Black and Hispanic households are still overwhelmingly represented in the unbanked population. The most recent survey from the FDIC shows about 9% of Hispanic households were unbanked in 2021, compared to just 2% of White ones.
VARGAS: There is still a level of intimidation when it comes to establishing a relationship with a financial institution, particularly with banks. So it’s important for us to make sure that Latinos know that we are here ready to serve them in their language of choice and more importantly, offer them the products and services that they need.
ROCHA: But what’s stopping banks from going further? When will speakers of non-Spanish languages have access to these same capabilities?
Lawyers who work for the industry say it partly comes down to resources. Banks are highly regulated, and they need to ensure they’re treating different groups of people fairly. That can open up banks to major penalties from regulators if their communications to non-English speakers are subpar or accidentally misleading.
Chris Willis, a lawyer at the firm Troutman Pepper, says that means banks set up multiple lines of defense for any product they roll out. There’s the customer-facing team — which sells products and interacts with customers. But there’s also a compliance team to make sure the bank isn’t breaking any rules — either in the customer interactions, in training material or written disclosures.
And on top of that, there’s the audit team — which makes sure that everyone did their job right.
WILLIS: That’s behind the scenes, and a lot of people don’t see that. But it’s done for the purpose of regulatory compliance, and at the insistence of the banks’ regulators. And so they can’t just casually launch things like that. It takes a lot of personnel and training and thought before you can roll something like that out.
ROCHA: But the industry’s main concern over the years has been that regulators just haven’t given them clear guidance. Willis and other lawyers say banks want to do more — and they have been. But they say they haven’t gotten enough guidance from regulators on how to serve non-English speakers without getting in trouble.
That’s particularly the case with the written documents banks send to customers. Even if customers don’t read every word, those written translations are where a lot of potential problems can pop up. Words in one dialect might make sense to one person but not to another. Or regulators might decide that a certain translated phrase is wrong and penalize a bank for sending it.
Willis says regulators are doing more to address these concerns — including by putting out model translated forms that the industry can use. But it’s taken years for these efforts to get going.
WILLIS: If there’s not a model form in another language, then the bank is at much greater peril of trying to guess what the right words are, and then wondering whether that will be acceptable to the regulator or will be understood by consumers later.
And at least in Spanish, there’s lots of room for error, says Vincent Ruiz, a lawyer who’s worked with banks on translations since the 1990s.
Here’s one example. In English, if a contract says a company can cancel something at its “sole discretion,” that means it’s the company’s choice to cancel and no one else’s. But if you translate that literally in Spanish — a su sola discreción — discretion more often implies someone being discreet or prudent.
That’s just one example of a potential misunderstanding — but big errors could get banks in trouble.
RUIZ: I’m able to assure that any subtleties are picked up and that any potential errors — or worse, any potential misleading statements, which could become problematic with one of the regulators, especially the CFPB.
ROCHA: Under its new director, Rohit Chopra, the CFPB has not shied away from penalizing banks and criticizing them publicly.
He hasn’t made major waves on language access, but that doesn’t mean the agency isn’t watching and prodding the industry in that direction.
Meina Banh is a senior advisor at the CFPB’s Office of Financial Education. She tells me the agency is focused on consumers with limited English proficiency — known as LEP consumers.
BAHN: We believe that all consumers deserve equal and fair access to a transparent marketplace and to be able to be empowered to hold institutions accountable for their actions, and this includes LEP consumers. So certainly, we think that there could be more done in this space.
ROCHA: The CFPB has worked on this issue for years, and it released some guidance on the topic in the closing days of the Trump administration.
Willis, one of the lawyers we heard from earlier, says there’s been a slight shift in the agency’s tone under Chopra. Before, the CFPB was looking to clear up hurdles or uncertainties and encourage banks to offer multilingual services. And now the tone seems to be moving a bit away from encouragement and more toward making language access an expectation.
To help banks with the process, the agency has created model forms in Spanish for lenders to use. That includes new documents for prepaid card disclosures and information for those who have been denied for a loan. The plan is to translate more disclosures in Spanish and other languages as well.
BAHN: We want to make things as plain language as possible. So again, easy to understand, easy to interpret, an ability for them to know exactly what my rights are, and where to turn to if I’m running into trouble.
Already, the agency has translated its website landing page to several languages, and it’s created glossaries of common financial terms. Banks, consumers and other agencies can use these translated glossaries if they’re translating phrases like annual percentage rate or cash advance fee.
And these documents are all user tested, to ensure people aren’t tripped up by a certain phrase and that the language is clear. The agency is basically telling banks right now – “Use these tools.”
BAHN: At least with CFPB resources, not only have we translated them, we’ve audited them, and we’ve also done user testing. So they should feel free to go ahead and utilize that.
ROCHA: But community groups say there’s also a role for other bank regulators to play. The three major federal bank regulators — the Federal Reserve, the FDIC and the Comptroller of the Currency — are currently making major revisions to the Community Reinvestment Act.
Congress passed the CRA in 1977 to reduce discrimination in lending. Lawmakers had already passed laws prohibiting discrimination based on race, but the CRA was meant to extend the prohibitions to lower-income consumers as well. The idea is that if banks take deposits from a geographic area, they should extend services to all members of that area, not just the most profitable ones. The agencies enforce that law by periodically examining banks just to make sure they’re complying with that requirement.
Community groups generally think that regulators could take a stronger stance in enforcing the CRA – and language access could be one part of that.
The three agencies released a massive 679-page document last May outlining their proposed changes. But a specific mention of language access is nowhere to be found.
ANDREW MENOR: It can be very difficult to understand and complete a lot of basic but key financial documents, it can be difficult managing bank accounts, resolving issues with financial products, and really conducting everyday financial affairs that are technical and challenging to navigate.
ROCHA: That’s Andrew Menor, who until recently worked at the Thai Community Development Center in L.A., which has the largest Thai population in the U.S. He says that language barriers cause many in the community —– whether they be consumers or small business owners —– to be shut out of the banking system. But this happens nationwide, he says, and regulators need to take stronger action as they finalize a new CRA.
MENOR: This is an issue that afflicts LEP populations across the entire country, which is why we believe federal regulators and agencies need to play a larger role in ensuring that commercial banks and institutions across the country do better.
Paulina Gonzalez-Brito, the CEO of the California Reinvestment Coalition, says regulators could give credit to banks during their exams if they’re serving customers well in languages beyond English. They say that would give banks a stronger incentive to roll out more in-language help or financial literacy information.
GONZALEZ-BRITO: This would be a really good outcome of CRA reform in order to prioritize and to incentivize banks to serve these populations.
ROCHA: They also say bank mergers give regulators a chance to improve language access. When banks want to merge, they have to get approval from regulators. And during that process, groups like the CRC negotiate community benefits agreements to make sure that the merger leads to tangible benefits for underserved communities.
Basically, the agreements often lead to banks pledging to fund more affordable housing projects, make more mortgages or small business loans in the community and agree to limit their branch closures.
But these negotiations are optional for a bank, and Gonzales-Brito says regulators should require them before banks merge, since that would give communities a chance to renegotiate their relationships with their local bank.
GONZALEZ-BRITO: One of the things that community benefits agreements do is they allow for community members and community organizations to be able to sit down across from a bank, and talk about what the community needs are. And often those needs include language services.
ROCHA: Community groups negotiated a language provision in an agreement with First Citizens BancShares, which last year merged with CIT Group. The bank has agreed to provide financial literacy tools in multiple languages, and Gonzales-Brito hopes that will become a feature elsewhere.
They also had their own story to share on language barriers in the system. They went with their father to open an account at a major bank — and the teller wrongly told him that he needed to sign up for an account where overdraft fees are possible if people don’t have enough money for a purchase.
Gonzalez-Brito knows these policies in and out, and told the teller that the bank actually has an account that lets consumers opt out of overdrafts and avoid the fees. They blamed this on a lack of training for branch employees, but it ultimately took about a half hour to resolve the issue.
GONZALEZ-BRITO: I was thinking, you know, if I didn’t speak English — like my dad doesn’t speak English — and I was by myself, how much harder would it be to get the kind of bank product that I need and to ensure that I wasn’t going to be charged these exorbitant fees that would then ultimately, potentially, push me out of banking altogether and into high-cost alternatives?
ROCHA: In researching this podcast, I went back to old congressional hearings, transcripts and CRA exams to see what’s changed over the years.
In 1973, Texas’ first Hispanic representative to Congress, Henry Gonzales, said on the House floor that Spanish speakers were facing language barriers in the credit system. And he gave credit to Sears for publishing a booklet for Spanish-speaking customers explaining how revolving credit lines and monthly statements work.
Gonzales would later become the chair of what’s now as the House Financial Services Committee and retired in 1998. Fun fact for Federal Reserve history fans — he’s also the reason why we get transcripts of the Fed’s monetary policy meetings after five years.
In some CRA exams from the 1990s and early 2000s, regulators talked about how the banks they reviewed offered some multilingual services. One bank even had ATM services in Spanish, Chinese, Korean and Portuguese.
Here’s former Fed Chair Ben Bernanke talking about language access at a hearing in July of 2008.
BERNANKE: There are still many people, disproportionately immigrants, who do not have a checking account, do not have a savings account. In not all, but in many cases those people would be better off with a banking relationship. They might be able to avoid high fees for remittances, for example, or high fees for check-cashing if they were associated with a bank.
ROCHA: And of course, there’s a long history of banks that cater specifically to immigrant populations struggling to get credit. Although some parts of the company are older, Bank of America got its start in San Francisco in 1904 as the Bank of Italy.
And there are over 100 minority depository institutions in the U.S., including some that focus on Hispanic and Asian American customers. The largest such bank is Pasadena-based East West Bank, which has over $60 billion in assets and bills itself as the premier financial bridge between the U.S. and Greater China.
There are also community development financial institutions and credit unions that focus on immigrant communities. The Inclusiv network, for example, has a certification called Juntos Avanzamos — that means together we advance – for credit unions that do a good job serving Hispanic customers.
I asked Vincent Ruiz, one of the lawyers we heard from earlier, about how he got his start in reviewing the legal accuracy of bank translations.
RUIZ: I literally fell into this.
It started in the 1990s, when he was working with a client that did business in Mexico. A lawyer on the opposite side of a case reached out later to say — hey, this auto manufacturer I know needs somebody to look at an ad they’re translating in Spanish. He reviewed the legalese at the bottom of the screen, just to make sure it was accurate. And that’s when bank clients that he worked with started asking him to do the same thing.
RUIZ: Then, other clients that I was dealing with at the time and representing asked me to start looking at some of their materials, because they began to provide Spanish language translations of, again, disclosures contract material, mostly credit card and mostly small business and consumer banking.
And here’s how Rebeca Vargas, the Wells Fargo marketing executive, got into this.
VARGAS: The census 2000 was coming out. And it was already pointing out to the importance of the Latino community, and the growth of the segment and, and its purchasing power.
Vargas was born and raised in Mexico City and worked in banking, where she helped launch Mexico’s derivatives exchange. Then she came to the U.S. to do her MBA and got a job at Citigroup, right around the time that Citi bought the Mexican bank Banamex.
VARGAS: I raised my hand and I suggested to the CEO of the Consumer Bank at the time that we had the opportunity to serve Latino customers in a unique way, since we had the bank on the other side of the border.
She led a team responsible for multicultural marketing at Citi and spent years doing similar work at Chase. Wells Fargo hired her in 2021. She says the industry has evolved over that time.
VARGAS: I think there are now more financial institutions that are able to offer end-to-end servicing in language. Back then, there were not that many. Now, I think we all realize that it’s a must, that it’s a priority.
Here’s a radio ad that Wells Fargo ran ahead of last year’s Men’s World Cup. It’s basically a guy buying tickets to a soccer game — when his friend notices he’s paying with a Mexican national team Wells Fargo debit card.
WELLS FARGO RADIO AD
ROCHA: Wells Fargo is the official financial services sponsor in the U.S. of both the men and women’s Mexican national teams.
VARGAS: Those are ways in which we are trying to reach Latino customers, not only in Spanish, but more importantly, I think, in a culturally relevant fashion.
Cortes, the Rochester consumer advocate we heard from at the start, says cultural competency is critical and that it needs to be present at every level of a bank — up to, and especially including, the CEO.
CORTES: It shouldn’t just be the tellers having cultural competency training, understanding language justice work. It has to be all the way to the top.
ROCHA: She says she saw a lot of language barriers after the financial crisis, when she worked as a paralegal for clients who were facing foreclosures and didn’t understand the documents they were receiving.
Years later, she co-founded a local language access coalition. She did so after thousands of Puerto Ricans relocated to Rochester after Hurricane Maria and had trouble opening bank accounts.
But she says there’s more to language access than just translations. It’s also about mirroring the communities banks operate in and making sure that people feel comfortable.
Cortes is Puerto Rican and says she doesn’t go to the bank branch near her house.
CORTES: I went one time, and it felt really uncomfortable. I was treated with as if they were scared to talk to me, and I’m thinking: I bank here. My money’s here. And that was the last time I went to that bank that was by my house.
At a different branch closer to her work, she had a much different experience. And that’s partly because of a woman who worked there named Rosa.
CORTES: Everyone in the bank would — because of my engagement with Rosa — knew who I was. So there was a friendly atmosphere when I walked in that made me feel welcomed. If I had any issue, they were like, oh, let’s sit down. Let’s figure it out. What’s happening? Even giving me extra lollipops – here, take extra lollipops for your kids.
ROCHA: For now, Cortes will work so that others can feel welcome at their banks, too.
CHANA SCHOENBERGER: This episode of Bankshot was written and produced by Polo Rocha. Our executive producer is me, Chana Schoenberger, and our sound engineer is Kellie Malone. Special thanks this week to the Empire Justice Center, Wells Fargo, PNC, Chase, Bank of America, MIT, Troutman Pepper, the Ruiz Law Group, the CFPB, the Thai Community Development Center and the California Reinvestment Coalition. If you liked the show, please like and subscribe, or do yourself a favor and visit www.americanbanker.com/subscribe to get some of the best news and analysis out there. For American Banker, I’m Chana Schoenberger, and thanks for listening.