Learning about the Bottom of the Pyramid

Apologies to readers of this blog (and thankfully there are a faithful few) for the long delay in generating a new post. The chance discovery of financial services available at Wal-Mart, which I discussed in my last post, impressed upon me how much I do not know about existing options for the poor in the U.S. In a recent development regarding Wal-Mart it was announced last week that they have joined the Secure Remote Payments Council, a non-profit industry group that supports the growth, development and market adoption of debit based internet eCommerce and mobile channel payment methods.

I have been thinking about how much else I might not know in this space. Who are all these people categorized by the U.S. government as “under-banked” and how can their needs best be addressed? Twenty-five percent of American households (see previous post) is a lot of people—maybe as many as 100 million give or take a few. This is far more than the just the homeless and illegal immigrant populations, although they would certainly be counted as among the “under-banked.”

Access to financial services is a critical problem whether for poor entrepreneurs in Indonesia or the homeless in the U.S. But it is by no means their only problem. Appropriate remedies need to be based on just where the poor fit on a continuum from the “poorest of the poor” to the “working poor” to people at the lower end of the middle class where the loss of a job or catastrophic medical emergency might lead to a precipitous slide into poverty.

Over the past two weeks I have spent some time talking with people who deal with the lowest end of the spectrum in San Francisco. At St. Boniface in the Tenderloin, an area of the City synonymous with the down and out, I met Laura Slattery who runs the Gubbio Project. Homeless people who have spent the night on the street are welcomed into the church to rest and use the facilities. While her clients stretched out in the pews for a few hours of rest we chatted quietly.

The church was less crowded than usual she explained because it was the first of the month, the day the City hands out checks. Where would they cash their checks I asked; what do they do with their money? Laura wasn’t sure. They probably pay too much to cash their checks and many will use the funds to find solace in drugs or alcohol. Some might get off the street for a few nights by taking a room in a single room occupancy (SRO) hotel. One thing was sure, Laura knew most would be back in the pews before the month was half over.

We walked the neighborhood visiting other programs serving the poor. At Hospitality House we met a woman, herself formerly homeless and a drug abuser, who now counsels others at the Self Help Drop -in Center. We asked if she thought a stored value card that could be acquired at Wal-Mart or Walgreens would be a valuable aid to clients. She didn’t think so. When they need money the most, she explained, it is usually late at night when the urge for a “fix” hits them the hardest. Then they have no option but to use the card to buy something they don’t need to get some cash back to buy their drugs. They’re better off just holding the cash she thought.

Laura suggested we have lunch at St. Anthony’s Dining Room, a facility adjacent to the Church that has been serving meals to the poor for six decades. I felt uncomfortable eating food meant for the poor but as it was the first of the month, demand was less than usual and Laura assured me there would be plenty for everyone. Besides, she said, you should learn what it feels like to receive charity and dine among the less fortunate. She was right. It was a humbling experience. One more lesson about what it means to be poor.

As we exited the dining hall I spotted two neatly dressed men at a table with information for veterans. They were volunteers from the VA providing outreach to homeless veterans. One-third of all homeless, they explained, are veterans. At their suggestion I called later in the day at the VA clinic located South of Market and learned about the Veterans Industries/Compensated Work Therapy program which works on placing homeless vets in jobs. I have some further meetings scheduled with the managers of this program and will no doubt be writing about this in future posts.

The following week when I returned to volunteer at the Gubbio Project Laura introduced me to Sister Carmen at Faithful Fools, a street ministry that, in their words, “…meets people where they are through arts, education, advocacy and accompaniment…” The Faithful Fools seem to act as a bridge between those on the street and those seeking to help. They conduct periodic “street retreats” for people interested in connecting with homeless.

Again we raised the topic of stored value cards for the poor with Sister Carmen. Perhaps it would be helpful for some she said but like the case worker at Hospitality House, she was under no illusions that the product would impede the purchase of drugs. She told us of one enterprising Chinese woman who had a wireless POS device she would use out on the street to provide cash to holders of ETB cards (electronic food stamps). This “innovative” service allows the poor to get cash without having to actually buy items permitted under the food stamp program. While certainly innovative, this hardly the kind of “assistance” the poor need to extricate themselves from poverty.

“Banking on the Poor” will promote the kind of financial access and infrastructure that we hope produces more constructive results. If you have time, check out the Gubbio Project web site. The video clip on the site is really quite moving. Just click on the link I have added to the list on this blog.