By Prateek Swain

Immigrants are a vital part of the American economy and society, contributing to innovation, entrepreneurship, diversity, and cultural richness. However, many immigrants face unique financial challenges that can hinder their integration and prosperity. Let us explore some of the common financial obstacles that immigrants encounter and how a holistic approach to immigrant finance can help them overcome them and achieve their goals.

Financial Challenges for Immigrants

According to the Pew Research Center, there were 44.9 million immigrants living in the United States in 2019, accounting for 13.7% of the total population. Immigrants come from different countries, cultures, and backgrounds and have different reasons and aspirations for moving to the United States. However, they also share some common financial challenges that can affect their quality of life and economic opportunities.

Some of these challenges include:

Lack of access to banking and credit services: Many immigrants do not have a bank account or a credit history in the United States, which can limit their ability to save, invest, borrow, and build wealth. Moreover, many immigrants face barriers such as language, documentation, fees, and discrimination when trying to access financial products and services.

Lack of financial literacy and education: Many immigrants are not familiar with the U.S. financial system, its rules, regulations, and norms. They may not know how to manage their money, budget, plan for retirement, pay taxes, avoid scams and frauds, or use financial tools and resources effectively. They may also face cultural differences and misconceptions that affect their financial behavior and decisions.

Lack of financial inclusion and empowerment: Many immigrants feel excluded or marginalized from the mainstream financial system and society. They may face discrimination, exploitation, or abuse from predatory lenders, employers, landlords, or other actors. They may also lack social capital, networks, and mentors that can support them in their financial journey. They may not have access to opportunities or programs that can help them improve their financial situation and achieve their goals.

Banking Opportunities for Immigrants

For many immigrants, opening a bank account in their new country is a critical step toward financial inclusion and stability. However, the traditional banking landscape can present challenges, especially when it comes to credit checks, annual fees, and minimum balance requirements. This is where units like Swadesh, Novo, and Wingocard, along with other services tailored for immigrants, come into play.

These platforms simplify the account-opening process, allowing individuals to apply without requiring a credit history check. This is a significant advantage, as it enables immigrants to initiate their credit journey by making everyday purchases. Furthermore, there are no annual fees or interest rates to worry about, making banking accessible and affordable.

Holistic Approach to Immigrant Finance

To address these challenges and help immigrants thrive in their new country, a holistic approach to immigrant finance is needed. A holistic approach is one that considers the whole person, their needs, goals, values, and circumstances, rather than focusing on isolated aspects or problems.

A holistic approach to immigrant finance would include:

Financial education and counseling: Immigrants need access to reliable, relevant, and culturally sensitive information and guidance on how to navigate the U.S. financial system and manage their money effectively. Financial education and counseling can help immigrants learn about financial concepts, products, and services; develop skills such as budgeting, saving, investing, and debt management; set realistic and attainable goals; and make informed and confident decisions.

Financial products and services: Immigrants need access to affordable, accessible, and appropriate financial products and services that meet their needs and preferences. Financial products and services can help immigrants save, invest, borrow, and build wealth; protect themselves from risks and emergencies; access opportunities such as education, housing, or business; and participate in the formal economy. Examples of financial products and services that can benefit immigrants include: bank accounts, credit cards, remittance services, microloans, and insurance policies

Financial inclusion and empowerment: Immigrants need access to opportunities and resources that can help them improve their financial situation and achieve their goals. Financial inclusion and empowerment can help immigrants overcome barriers such as discrimination, exploitation, or abuse; access programs such as citizenship assistance, financial aid, or scholarships; join networks such as cooperatives, associations, or clubs; and leverage their assets such as skills, knowledge, or experience.

Conclusion

Immigrants are an integral part of the American fabric, and their success is essential for the nation’s prosperity and well-being. However, many immigrants face unique financial challenges that can limit their potential and integration. A holistic approach to immigrant finance can help immigrants overcome these challenges and achieve their ambitions. By providing immigrants with financial education and counseling, financial products and services, and financial inclusion and empowerment, we can help them build wealth, create opportunities, and contribute to society.

(Author is CEO & Founder, Swadesh Inc)