Wells Fargo unveils program to help low-income residents build savings
OAKLAND, Calif. (KGO) -- Wells Fargo took a step forward in helping low income residents build their savings. The announcement is being cautiously cheered by some of the bank's harshest critics.
The San Francisco-based bank announced a partnership with a nonprofit to place a financial counselor in some of its branches. The move follows a scandal that nearly knocked the wheels off the bank's iconic stagecoach.
A financial counselor from the national nonprofit Operation HOPE will be placed inside select Wells Fargo branches in 20 cities around the country.
The HOPE Inside program will first be unveiled in Oakland, Atlanta and Houston.
In the East Bay, the money coach will be headquartered at the main branch on Franklin Street.
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Darlene Goins of Wells Fargo says that person's salary will be financed by a grant from the bank.
"They'll help them establish a budget, help to set aside savings for emergency savings or longer term savings. They'll help them improve their credit," Goins said.
The program will target those who currently don't have savings accounts and might rely on payday lenders and check cashing services that charge triple digit interest rates for short term loans from payday lenders.
Kevin Stein of the California Reinvestment Coalition gives that a thumbs up.
"It's a positive thing for Wells Fargo to be partnering with an organization like that that is in the community and trying to help families," said Stein.
However, he points out it was only six years ago that federal regulators found Wells Fargo had set up fraudulent savings and checking accounts for people without their knowledge, oftentimes ruining their credit.
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He accuses the bank of denying loans to African Americans at a disproportionate rate and of hitting customers with $1.4 billion in overdraft fees.
"We have done things like eliminate overdraft transfer fees. We also have eliminated the non-sufficient fund fee," Goins said.
"They are still charging $35 of an overdraft and allowing overdrafts up to three times a day," Stein said.
But Goins says the bank has a 10 year commitment to reach underserved communities.
"We have partnered with other organizations such as Operation Hope to help empower people financially so they can achieve those dreams," she said.
Operation Hope won't wait for people to come to them. It will go out in the community to seek the unbanked out and help them become banked.
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