There are only three financial institutions in Austin, serving over 90,000 residents: The Great Lakes Credit Union at Leaders Network Financial on Madison Street, a BMO Bank on North Avenue, and a U.S. Bank branch on Madison Street.
“I would say, for at least 10 years, there’s been one bank in Austin, which is ridiculous,” Austin native Michelle Collins told Austin Weekly News of the U.S. Bank facility.
Collins is a retired community development banker, who helped give home and commercial loans to Austin residents for over 25 years. She was also instrumental in getting the Great Lakes Credit Union’s Leaders Network branch to open last year.
Just west of Austin Boulevard, Austin’s western border, Oak Park has a U.S. Bank and the Self-Help Federal Credit Union. These institutions contribute to Oak Park having about three times more banks than Austin, for just over 50,000 Oak Park residents.
“Austin is very underbanked,” Athena Williams, executive director of the Oak Park Regional Housing Center, told Austin Weekly News. Williams was born and raised on the West Side and initially part of the Leaders Network committee to get the Great Lakes Credit Union to come to Austin.
“Not just Austin, but West Garfield, North Lawndale – they’re all financial deserts,” Collins said.
That’s because, for better the better part of 50 years, Austin has been actively disinvested from by many sectors, including banks. Also, while Austin is one of the largest Chicago neighborhoods, it is not as densely populated as others.
But more banking options are on the horizon.
Forty Acres Fresh Market, expected to open this year, plans to include a PNC Bank branch. BMO Bank plans to be a tenant in the Aspire Center for Workforce Innovation, which will have its grand opening later this year.
And the Oak Park Regional Housing Center has had several banks submit letters of intent, wanting to move into the development at the old Laramie State Bank. Construction to develop the lot’s apartment buildings is underway and expected to wrap next February. The original bank building, which will include office and retail space, is expected to open after the apartments do and will include a financial institution.
Doubling Austin’s banking options within the next year is something that the community has been working toward for a long time.
“The future now looks brighter than it has looked in the last 10 years,” Collins said.
“Banks are starting to show an interest in being located on the West Side,” said Darnell Shields, executive director of nonprofit Austin Coming Together and board member of Growing Community Media, the parent company of Austin Weekly News. “In the last, I would say five years, we’ve seen more banks have a greater presence in the community of Austin.”
Shields said he recently heard from people at Wintrust that the bank is interested in having a presence on the West Side, and he said that JP Morgan Chase may be interested as well. He largely chalks that up to work that’s been done in the community to attract developers and those who want to invest in the West Side.
“Having a lot of economic activity and economic growth will help convince banks that they ought to be located in the Austin community,” said Ed Coleman, former CEO of Bethel New Life and West Side Forward, who was recently named executive director of the Austin Chamber of Commerce.
As with any business, Coleman added, it’s necessary to show banks that there’s a market in Austin, “that there are people and businesses with the resources that will make it worth their while to open up a facility.”
What does a community lose in a financial desert?
“The greatest source of wealth is basically access to capital,” Collins said. And without enough banks and credit unions, Austin residents don’t have access to that capital.
Collins added that, if people don’t have a place to save and borrow money, or have a debit or credit card, it’s difficult to buy a home or get a car loan.
Because of Austin’s lack of financial institutions, residents who use banks and credit unions often go to neighboring communities, saving and spending their money elsewhere.
“When people go to the bank, they’re going to naturally spend their money near where they’re banking,” Williams said. “We have a huge situation where a lot of the residual income from Austin goes to Oak Park.”
Aside from keeping money within the community, having more banks in Austin would increase equitable access to financial institutions on the West Side.
“You shouldn’t have to have a car and drive some place that is maybe unfamiliar to you and where you don’t feel welcome,” Collins said. “You want to be able to walk from your apartment or your home, drive right around the corner and get to know your local banker.”
While Austin has been underbanked for decades, it became especially apparent during the pandemic, according to Coleman.
In 2021, the government launched the Paycheck Protection Program to give federal grants to businesses that were struggling after Covid-19. Coleman said he saw many large banks that administered PPP loans weren’t very receptive to engaging with local business owners, preferring to support their existing clients or larger ones.
Coleman said that could partially be because some smaller local businesses aren’t operating with all the necessary documents – something he saw often at Bethel New Life and West Side Forward.
“They need to have records and paperwork and all the things that these institutions are requesting,” Coleman said. He added that, as a part of the Austin Chamber of Commerce, he plans to work with these businesses so they have the necessary documents to apply for future grants. And that local financial institutions will be necessary if there’s another widespread sickness like Covid-19.
“If anything like a pandemic were to hit, having community banks available to support businesses in particular is a great thing to have,” Coleman said.
How to get more financial institutions in Austin
Though there’s a handful of banks that plan to have an Austin presence within the next year, local shareholders say they must continue partnering and having conversations with financial institutions if they want more of them in their communities.
“We can’t just sit back and hope some bank will say, ‘I think I’ll go to Austin,’ or ‘I think I’ll go to Garfield,’ or ‘I think I’ll go to Lawndale,’” Collins said.
Instead, organizations and shareholders need to come together to get these institutions to the West Side. It’s what Austin is currently seeing as the Leaders Network partnered with the Great Lakes Credit Union, and with the three banks moving into Austin within the next year.
“We’re saying, ‘We’re here. This matters to us. Let me show you the value of coming to bring these services,’” Collins said.
“I think what would really help some of the bank partners become even more intentional about investing in communities is being able to understand where the opportunities are for their shareholders and their services that they provide,” Shields said. He added that they can learn about where there is land or vacant building space by talking with those in the community.
But there’s also an onus on Austin residents to get more banks in their neighborhood.
“We have to make sure we use the banks, and we have to make sure that we support the banks to keep them in our communities,” Williams said.
Collins said parents can help with this effort by starting their children out with student accounts, teaching them how to manage money and access capital at a young age.
Williams said that’s what her parents did when she was young, and her father took her with him to go to the bank.
“When he went to the bank, the whole family went to the bank,” Williams said. “A family that banks together, grows wealth together.”
Correction, March 24, 2025, 2 p.m.: An earlier version of the article gave the incorrect number of financial institutions in Austin. There are four, including the Old Second Bank. We apologize for the error.
