Finally. An actual reason to care about your rep in the NRI community.
It seems banks are sprouting up in the US that cater specifically to Indians, according to this Hindustan Times article, which says a dozen such already exist. Indians sans credit history who might be viewed unfavorably at the big banks - where sub-prime angst runs thicker than unclarified butter - turn to these Amma and Appa joints to be properly judged.
Sushil Patel, son of Chan Patel (founder, president, chairman and CEO of the State Bank of Texas) explains:
“Ethnic banks avoid bad loans as they take decisions based on factors like culture, background, social status. They are able to judge a person’s character better than regular American banks, who don’t know their clients as well. We are able to check the guy’s character because of the close-knit Indian community in the US.”
Hmm. So the aggressive pursuit of social standing produces real results these days, not just the downfall of budding young novelists.
The concept seems a bit like microlending in that it gives a chance to people who need it and can’t get it. Only instead of reducing risk by micro-ing the loan, this system pads itself by macro-ing the assessment. It’s a crowdsourcing model along the lines of the Wiki, where the wisdom of a group - in my case, the Kannadiga community in Dallas - acts as a legitimate reference point. I’m not quite sure the ins and outs of how one is judged, but I imagine it could go something like: “Her grandfather was a government officer with my father back in Coimbatore. I think she’s good for it.”
It creeps me out, but I think it’s sort of brilliant. And apart from what I think, it seems to be working.
Chan’s State Bank of Texas is running a major operation, with $500 million in assets and more than $175 per share. Three-quarters of its loans so far have been made to minorities, and it’s projecting more than $85 million in loans for the upcoming years, again, mostly for minorities (all this on its website).
The article cites the richest among the banks to be the Mutual Bank of Chicago, which boasts assets worth $1.35 billion (still a good 1,000 times smaller than the Bank of Amrika).
The Mutual Bank’s site is not nearly so forthcoming about its Indo-American agenda as are the Texas Patels, although it does have a section solely on “rupee remittance to India.” It is, however, on Devon Ave., which is akin to tattoing oneself in white, orange and green laddus. Not too far from it is the Devon Bank, which uses Muslim Sharia law in its lending practices.
The point here is not however, that these banks are targeting South Asians. That concept is not new, as the string of Laredo Banks in Texas proves. The point is that an abstract and central (and often depressing) reality of our ex-patriatic life is being capitalized on. It appears in the bulk of literature and movies we South Asians produce. It drives so many of our conversations. It is this simple fact: that in our communities - from Gibraltar to Kenya to Peoria, IL, in communities 1,000 to 10,000 strong - we can’t hide. We know everything about everyone. Who better to judge whether Such-and-Such Murthy deserves a $30,000 loan than all of us?
The loans seem intended for newly landed Indians, but with banks in straits as dire as they are, ABDs with no credit history to their name - like, well, me - could conceivably find themselves in Chan Patel’s worthy establishment asking to be floated that first down payment.
I assume I’d pass the background check. Then again, what if no one likes me?
