James Gutierrez knows what it’s like to live on the edge of poverty and to not have access to the financial tools and systems that middle class and affluent Americans have. That’s why he’s dedicated his life to helping the underbanked in America. Underbanked people are working people without a checking or savings account, without a relationship with a bank that can help them with a loan or a line of credit to see them through short-term financial challenges. Gutierrez says that this describes nearly 25 percent of the American population.
Overcoming the challenges of the underbanked
Not having access to traditional banking tools makes it much harder for hard-working poor people to succeed and to break out of the cycle of poverty. Gutierrez explains that there are many reasons for people not to have a bank account. Maybe they don’t have enough for the initial deposit. Maybe they’ve had credit issues and can’t pass the basic credit check necessary to open an account. Or, maybe it’s something as basic as transportation, that they don’t have easy access to a bank, or they simply don’t know how to open an account.
Without a bank account, people pay high fees to cash payroll checks, as well as fees to buy money orders. That’s not even taking into account the security risk of carrying around an entire paycheck worth of cash. Gutierrez explains that the average underbanked household spends about 9.5 percent of their income on fees for alternative financial services.
Fighting for change
James Gutierrez has a long history of fighting for the underbanked. His venture, Oportun, helped largely-Hispanic households from 2005 to 2012 have access to short-term loans. During those years, Oportun helped more than 500,000 people get the money they need to advance their lives and their careers. Gutierrez has also championed the need for Community Development Finance Institutions (CDFIs) and Minority Depository Institutions (MDIs), especially in minority neighborhoods. His latest venture is creating a new inclusive mobile-first platform to connect these communities to insurance and banking solutions. According to Gutierrez, this new venture aims to provide “reasonable, affordable and accessible options to make purchases, build credit and establish financial security”.
About James Gutierrez
In addition to his work with the underbanked, James Gutierrez is the CEO and co-founder of Insikt Ventures, an early stage investment fund. Just a few of the companies that Insikt has invested in include Listol, StubHub and OKCupid. Gutierrez also sits on the executive boards of the Silicon Valley Leadership Group, Talent Inc and his daughter’s private school.
Gutierrez earned a BA in economics from Yale University and a MBA from Stanford Graduate School of Business. He has served on the San Francisco Federal Reserve Board’s Centennial Advisory Committee and its Consumer Advisory Council. In 2010, “Business Week” magazine named Gutierrez on their list of the most promising social entrepreneurs of the year.