Fewer banks and rising temps are a dangerous mix in Imperial County
Access to banking is an important facet of a community's health and as KPBS, race, inequity reporter Christina Kim finds in Imperial county, a shortage of bank branches and rising temperatures can be a dangerous mix.
Noon is still hours away on a Tuesday and early August, but the streets of El central California are so hot. It feels like the soles of your shoes could melt into the asphalt suffering in this heat. Our lines of people, many elderly outside of bank of America and Wells Fargo's branches, beads of sweat form on the faces of customers. As they wait patiently to use the ATM or talk to a teller
Once they get here is an agricultural worker from Hopeville California. He waited an hour just to use the bank of America ATM during his break. He says, during the high heat season, the weight for an ATM is unbearable because there's no shade. Maria Lopez is retired and lives here in El Centro. She says she nearly fainted. Once when waiting at the bank on a hot day
Russian doors, where it was cooler. But to this day, she can't be out in the heat for long, without getting sick.
The local Wells Fargo branches in El Centro and Calexico have devised systems so that people have access to shade. And someone is always there directing the flow of people. So how did it come to this El Centro as an Imperial county situated on the edge of the Anza Borrego desert state park, but the region is at risk of becoming another type of desert, a banking desert. There are only 12 brick and mortar FDAC insured banks for Imperial counties over 180,000 predominantly Latino and low income residents down from 19 as recently as 2013,
I think we have seen a fair amount of branch consolidation. Um, in the past several years,
That's Beth mills spokesperson for the Western bankers association. She says consumer habits are driving the change, making branches less important.
There's been a lot less people going into branches now with everyone doing mobile banking, not everyone, but a huge
The majority, but Jason Mendoza, the director of the Imperial valley, small businesses development center says not everyone is online savvy and the lack of bank branches can be challenging for the small business owner. She works with
The culture here is very different. Um, I can honestly say most business owners want to sit down and sit in front of a person and know who they're conducting business.
Maria Lopez, who nearly fainted while waiting in line. That one time
Tells me she doesn't know how to bank online and isn't interested.
She wishes there were more banks in the area, so people wouldn't have to wait so long. One Lopez is spokesperson for Wells Fargo who grew up in Imperial county is no stranger to the lines. His own mom likes to go in and talk with the teller. I asked him if he thinks more branches would help alleviate the lines,
Probably not the best person to answer them. But I would say, I would say very strongly.
He does say however that when the branch has started to close in Calexico a few years ago, the lines got longer.
So shutter and leave the community. The lines just get progressively worse because we're the only bank there in Calexico suspicious
Less than a mile from the Mexico border and littered with cash checking places. Calexico only has the single Wells Fargo branch where lions can take up to three hours, California state Senator Ben waySo represents Imperial county. He told KPBS in a statement that banking access is a huge problem in the valley. waySo has coauthored two recent bills that have paved the way for public banking options, which he says are needed because quote, this issue is not going away for now though. People are still lining up at Imperial's few bank branches, no matter what the thermometer reads. Christina Kim KPBS news,
Joining me is KPBS race and equity reporter, Christina Kim, Chris, welcome to the program,
In your report, you say Imperial county only has one bank for approximately every 15,000 residents. Can you contrast those numbers with the kind of access to banks we have here in San Diego?
Sure. So it's hard to compare Imperial county with San Diego county in some respects, just because of the sheer size differences as well as different demographics, but looking purely at the numbers, San Diego county has a population of about 3.3 million people, people, and there's 527 FDI insured banks. So that breaks down to approximately one bank for a little over 6,000 people. It's obviously still like a big disparity when you hear it. But I think it's interesting that, and I want to look at more is where benches clustered. So breaking it down a little more granular they'll Centro, which is an Imperial county has eight brick and mortar branches for the population of over 4,000 people on a beach in north county. And Diego has a much smaller population of 13,000, but they also have eight banks.
Can you tell us more about how bank branches in El Centro and Calexico, how do they try to provide shade and shelter to people waiting on long lines?
Yeah, so most bank branches and Imperial, no that the first week of the month when disability checks social security and paychecks are coming in is going to be hectic. So when I was down there, what I saw was Wells Fargo had really pitched up tents in one instance. And then in El Centro, they had blocked off part of the shaded parking lot. So cars couldn't park park there in order for people to be able to line up. And what I really saw was like a lot of people creating a system to try and process people as quickly as possible. You know, there's somebody on a walkie talkie inside of the bank talking to someone outside. Who's just really trying to get people moving quickly and also giving priority to the elderly and those who really just are suffering in the heat or just can't stand in line for very long
On about how long are those weights,
Right? So these weights really depend on the day, of course, but we've heard cases in which the outlet, the weight can take up to three hours. And that's especially in Calexico where there's only one single brick and mortar brain.
Now in listening to your report, it occurred to me, would offering classes to people on how to access online banking. Would that help the situation?
That's an interesting question, Marine. So what I heard from a lot of the people that I spoke to in banks, including Jason Mendoza, who now runs the small business development center, but used to work at a bank is that banks really are the ones, bank branches are really the ones that are doing that kind of education. So much of it is, Hey, this is how you use an ATM, this is how you might use mobile banking. And we do know according to the Wells Fargo spokesperson, one Lopez that they have seen the use of mobile banking go up, but it's kind of like a chicken and an egg situation Marine, right? If these branches are the ones that are providing this kind of financial literacy, as well as access to online banking help, then there kind of needs to be more right in order for that education or that kind of help with access to be there. And I think in such situations it's important, not necessarily to put the onus on the clientele. So the question is less why can't people just do online banking and more, why are institutions not meeting people where they're at?
And there's only one bank in Calexico now
That's right. And Calexico, there's only one single brick and mortar branch, which is Wells Fargo. And that's where I was saying the lens can get extra long as a result. That's where we're seeing those kinds of three hour wait times at times
Now Wells Fargo has come under a great deal of criticism for the amount of fees and charges. It's recently launched a program aimed at changing that, but it's not been known as a great bank for low income people. So I'm wondering, could check cashing stores be a workable option for some residents,
Right? So to your point, Wells Fargo has been scrutinized for fees and also just not being as present in low income communities where black and Latino people live in may of this year, Wells Fargo launched a ten-year plan or initiative to increase their presence and underserved communities, and really tackle the issue of financial exclusion and really reach out to those that aren't banked at all. So we're going to have to see where that program really goes, but to your question about check cashing options, the fact is that in Calexico and El Centro, I did see several check cashing places as well as payday loan centers and people, especially those that are un-banked or under-banked, which is when someone has a bank, but also uses alternative financial products like check cashing places. They're more prone to use it, but there are really risks and costs associated to check cashing places.
So check cashing places, give you immediate cash for your check, but it's at a price. They charge transaction speeds, which can be very high and over time can really add up. If that's the sole way a person is, you know, banking or doing any kind of financial tracking transactions, moreover funds, there are not insured. And there's a higher risk that clients using check cashing places will be offered a payday loan, which we know have extremely high interest rates and can further push people into a cycle of debt. So yes, it's workable, but I think a lot of folks wouldn't say it's, it's advisable.
Now you say state Senator Ben weso has introduced bills to create public banking options. Tell us what would they be
When I asked, uh, states that are been wasted, a comment on this issue, the first thing he told me is that it's very much a huge problem, right? Banking access is a huge problem in the valley. And then he also noted that he's heard two bills in the last few years that have paved the way for public banking, which I think is this his way of signaling that this is a possible solution. So the first was just signed into law this year, and it's going to create a physical feasibility study for the so-called Cal counts, which provide low-income families with zero interest and zero fee accounts with no minimums that will be regulated by the state that managed your financial institutions. And the goal of this was really, Hey, let's do a study to see how we can get those who are unbanked or underbanked, you know, to get banked so that they're not relying on predatory products.
And the second is the now 2019 law that created a legal framework and pathway for up to 10 public bank charters to be piloted so far, Los Angeles and San Francisco are the furthest ahead, but these would create new municipal owned banks, which again, they're not these bills and public banking are not specific to Imperial valley, but against, you know, his inclusion of public banking seems to be signaling that state Senator waySo thinks that in order to address banking issues in the valley, there's going to have to be some creative solutions down the line, perhaps such as public banking.
I've been speaking with KPBS race and equity reporter, Christina Kim, Christina. Thank you.
Noon is still hours away on a Tuesday in early August, but the streets of El Centro, California are so hot it feels like the soles of your shoes could melt into the asphalt.
When the clock strikes 8 a.m., the temperature is already pushing past 100 degrees.
Suffering in this heat are lines of people outside Bank of America and Wells Fargo branches. Beads of sweat form on the faces of customers as they wait patiently to use the ATM or talk to a teller.
Among them is Juan Siqueria, an agricultural worker from Holtville, California. He drove over 30 minutes to get to Imperial County’s only Bank of America branch and then waited an hour just to use the ATM.
“Now during the high heat season it’s unbearable to stand in line waiting for the ATM because there’s not even shade to ward off the heat.”Juan Siqueria, agricultural worker from Holtville, California
“Now during the high heat season it’s unbearable to stand in line waiting for the ATM because there’s not even shade to ward off the heat,” Siqueria said in Spanish.
El Centro is in Imperial County, situated on the edge of the Anza-Borrego Desert State Park. But the region is at risk of becoming another type of desert —a banking desert.
The largely rural county is one of California’s poorest and home to about 180,000 predominantly Latino residents. Currently, there are only 12 brick-and-mortar Federal Deposit Insurance Corporation (FDIC) insured banks in the county, or one bank per approximately 15,000 people. As recently as 2013, the county had 19 bank branches.
El Centro is the region’s banking center with eight brick-and-mortar branches that serve its over 40,000 residents, plus others from around the county. In comparison, Solana Beach, an affluent city on the coast in San Diego County, has eight branches serving a population of 13,000.
It’s a common sight to see lines that can take up to three hours outside of Imperial County’s bank branches and ATMs. The lines get particularly long during the first week of the month, when people come to cash in their paychecks, social security and disability checks.
The role of climate change
Heat, like long lines, is away of life in this region. But with extreme heat temperatures rising due to climate change, people’s exposure to the heat is becoming increasingly dangerous.
According to the Imperial County Public Health Department, 268 people suffered from heat-related illness in 2021 as of Oct. 2, 2021. During that time period, 22 people died from heat-related illness. And that number is onlyexpected to rise over the next few years.
Maria Lopez, a retiree from in El Centro, nearly fainted while she was waiting to go inside Wells Fargo Bank.
“A lady (in the line) told me that I didn’t look good and then they rushed me inside where it was cooler,” she recalled in Spanish. “I can’t be in the heat very long because I get sick.”
The demand is so high during certain days that the Wells Fargo branches in El Centro and Calexico have devised systems so that people have access to shade.
Lopez wishes there were more bank branches so people didn’t have to wait too long or travel to El Centro from around the county to do their banking. She thinks the limited number of branches in the region contributes to the long wait times.
There are a number of reasons why the county has such a shortage of banks. One is the war on drugs.
A large number of banks along the Mexico-U.S. border began to close from 2013 to 2015 due to what bank officials then said was a crackdown on drug-related money laundering policies.
Beth Mills, a spokesperson for the Western Bankers Association, acknowledges that additional reporting requirements during this time could have played a role in branch closures.
But changes in consumer habits also play a major role, she said.
“I think we have seen a fair amount of branch consolidation in the past several years, just given the preferences for how people bank have changed.”Beth Mills, spokesperson for the Western Bankers Association
“I think we have seen a fair amount of branch consolidation in the past several years, just given the preferences for how people bank have changed,” Mills said. “There's been a lot less people going into branches now, with everyone doing mobile banking.”
Juan Lopez, a regional spokesperson for Wells Fargo, also says he’s seen an increased use in online and mobile banking.
“Everyday banking is going to be and is completely digitized now,” he said. “I personally would guesstimate that the teller line will eventually, probably, go the way of the dinosaur over the next 10 years.”
According to a2019 survey by the FDIC, which regulates banks, more and more people across all demographics are using mobile banking. However, the same study showed that in-person banking is still popular in rural areas. More than 87% of rural households visited a bank branch once in 2019, and more than half visited a branch 10 or more times, the study showed.
These numbers make sense to Jaysel Mendoza, the Director of the Imperial Valley Small Business Development Center. As a native of Imperial County who works with small businesses in the area, she sees first hand the important role brick and mortar branches play in Imperial county.
“The culture here is very different,” she said. “I can honestly say that most business owners want to sit down and sit in front of a person and know who they are conducting business with.”
She said the lack of branches can be a challenge for small business owners she works with who are looking to build relationships with banks. Such relationships are absolutely vital for the economic health of a community, according to some studies.
A 2018 study by the University of Delaware found that branch closures lead to a 20% drop in small business loans. And a relationship with a lender, such as a bank, was a crucial lifeline to applying and receiving Paycheck Protection Program (PPP) loans during the height of the pandemic.
Beyond the needs of small businesses, Mendoza believes bank branches also help with language barriers that can be especially daunting when dealing with financial matters.
“I worked at a bank, I remember I would have individuals come in who didn’t speak English and they would come in and say, ‘I got this letter’ and it wasn’t even related to the bank,” she recalled. “And I would say OK, let me help you.”
Bank branches in the area are in this way providing financial education and serving as community resources. And that’s not a role that Mendoza thinks can be fully replaced by mobile banking or ATMs.
According to Mendoza, the bottom line is the majority of the people lining up at the beginning of the month are older and already used to doing their banking in person.
Maria Lopez, who nearly fainted waiting in line that one time, says she’s not interested in mobile or online banking.
Pointing to KPBS Reporter Cristina Kim's phone, she said: “I don’t know how to do that, mija.”
Even though she’s learned when to come to avoid the worst of the lines and appreciates Wells Fargo’s organized system, she still wishes there were more banks in the area so people wouldn’t have to stand in line.
Juan Lopez of Well Fargo is based out of Los Angeles. But he grew up in Imperial County and is no stranger to the banking lines.
He’s not certain more bank branches would alleviate the wait times, but does acknowledge that when a lot of branches started to close in Calexico, the lines got longer at Wells Fargo.
“As (Citibank and Bank of America) shutter and leave the community, the lines just got progressively worse because we were the only bank there in Calexico,” Lopez said.
Less than a mile from the Mexico Border, Calexico’s sole brick and mortar branch is the town’s Wells Fargo. Some days the lines can take a person up to three hours, according to Lopez.
Bank of America’s Calexico branch closed in 2015. In a statement to KPBS, Bank of America spokesperson Colleen Haggerty, said the decision to close was because 80% of transactions were taking place at the ATM.
When the Calexico Bank of America branch closed it left behind a row of ATMs. On that third day in August 2021, a line of people waits to use them. There’s no shade to block the beating sun.
“This issue is not going away,” said California State Senator Ben Hueso, in a statement to KPBS. “Banking access is a huge problem in the Valley.”
Sen. Hueso noted that he is “grateful to Wells Fargo for rising to meet the challenge” in Calexico, but that there is “still enormous need for banking services.”
He recently co-authored two bills that havepaved the way for public banking optionsat the state and local level and he says banking will continue to be one of his legislative priorities.
For now, however, people are still lining up at Imperial’s few remaining bank branches, no matter what the thermometer reads.