From both sides of Mount Pleasant Street, where faces and accents reveal childhoods spent in El Salvador, Ethiopia and Vietnam, a daily battle is being waged for immigrants' pocketbooks.
Western Union's yellow awning is squished between a pupuseria (a restaurant that sells El Salvador's signature dish) and the Dos Gringos cafe. The wire-transfer outlet's sign has a Spanish subtitle: Dinero en Minutos. Its walls are plastered with posters advertising legal services and international phone card rates.
Across the street is a Bank of America branch where three of the four tellers speak Spanish and the cheery credit-card ads on the wall show more brown faces than white ones.
The two businesses are local adversaries in a national fight for business of immigrants from Latin America and the Caribbean. Last year, that growing group sent more than $30 billion to their home countries, according to preliminary estimates by the Inter-American Development Bank, headquartered in Washington.
Wire-transfer companies such as Western Union Financial Services Inc. and Travelers Express/Moneygram dominate the remittance business, which brings in $3 billion to $3.5 billion a year in transfer and currency conversion fees. But the business is changing. Banks, which transmit only a tiny fraction of that torrent of cash, want more of the money-sending market. They see it as a gateway to a group whose interactions with financial institutions are often fleeting or nonexistent.
Only half of Latino immigrants in the United States have bank accounts, according to the Inter-American Development Bank. Some are afraid to open an account because of their immigration status; others are turned off by recurring fees or minimum monthly balances.
By forging an initial relationship through remittance services, banks hope to persuade those elusive customers to open basic checking accounts and apply for credit cards, car loans, and mortgage loans.
"Baby steps," said Brahim Rawi, the manager of Bank of America's Mount Pleasant branch.
Major commercial banks in the United States are developing ties with Latin American banks, especially banks in Mexico. The U.S. banks are trying to lure customers from wire-transfer services with new, and often cheaper, remittance services.
"Western Union is really outrageous," said Tania Gomez, 27, an accountant who emigrated from Peru eight years ago. She said she paid $11 to send $100 to her aunts and uncles in Lima in January. In February, she managed to send $120, but had to pay a $22 fee. She understood that the company's fees were somehow related to the amount of money sent, but not in enough detail to minimize the monthly expense.
She said she hoped that Rawi would tell her about a cheaper way to help her relatives, perhaps through the bank -- after she got advice about how to apply for a home equity loan.
From November 2001 to November 2002, when several mainstream banks began going after the immigrant Latino market, the average cost to send $200 to Latin America declined 9 percent, said Manuel Orozco, who studied remittances extensively as project director for Central America at the Inter-American Dialogue, a policy research group.
Ten to 15 percent of the money sent home by Latino immigrants is eaten up by transfer and foreign exchange fees.
Part of the reason banks can undercut wire-transfer prices is that they offer remittance services that often are linked to a checking account, and can disburse funds through automated teller machines. Once a customer enrolls in the program, an order to send money can be executed over the phone or the Internet.
The trick is to get more immigrants to establish real banking relationships in exchange for cheaper remittances.
Bank of America in May launched a pilot program called SafeSend, which allows a recipient to pick up money from one of 20,000 ATMs in Mexico using an access card, which can be tied to the sender's credit card or checking account. The accounts do not have to be with Bank of America.
As with most money-transfer services, there is a flat fee for each transfer. SafeSend users are charged $10 for each transfer up to $1,000. Citigroup's Citibank subsidiary has a similar service with the same fee called C2it, that uses branches of Banamex, a Mexican bank that Citigroup bought last year.
Orlandi Valuta, a subsidiary of Western Union that caters to Latin American immigrants, charges $14.99 for transfers up to $300.
The banks' offer what could be only a 1 percent transfer fee, but the average amount sent is typically between $200 and $300 and often smaller. Even taking into account average transaction sizes, bank fees for remittance services usually end up being lower than those charged by wire-transfer firms.
That puts pricing pressure on the wire-transfer services. In Spain, where banks offer Latin American immigrants more sophisticated remittance products than those here, Western Union has been forced to reduce its fees by 50 percent in recent months to remain competitive, said Donald Terry, manager of the Multilateral Investment Fund at the Inter-American Development Bank.
"They'll have to come up with new products," said David Robertson, publisher of the Nilson Report, a newsletter on the payment industry. He said the most likely candidate is a card service that competes directly with systems such as SafeSend. "But they do have the benefit of inertia," Robertson said. "They have been the provider to this community for decades. It isn't as if their customers are going to walk out the door en masse."
Western Union still has a major advantage in the number of agent outlets, both here and in Latin America, said Ruairi O'Neill, an analyst at PNC Advisors.
While the commercial banks focus on the Mexican market, transfers to Mexico are only 2 percent of the total profit of Western Union's parent company, First Data Corp., O'Neill said.
Fifty-seven percent of El Salvadorans, Washington's largest immigrant group, send money home, compared with 45 percent of Mexicans.
San Francisco-based Well Fargo has offered Intercuenta Express, a service for Mexican immigrants that requires both the sender and recipient to have bank accounts, since 1997. Jane Hennessy, a senior vice president in Wells Fargo's international group, said that she spends at least one day a week talking about expanding the bank's remittance services beyond Mexico.
"El Salvador and Guatemala are probably the two that fit best with our market although we're looking into certain Asian countries as well," Hennessy said. The bank, which was the first to allow immigrants to use the Mexican government's "matricula consular" card as identification when opening a bank account, now accepts a similar card issued by the Guatemalan government.
FleetBoston is also developing a money transfer service based on an ATM network, but it won't be available this year, spokesman James Schepker said.
What Western Union, its subsidiary Orlandi Valuta, and Moneygram do not have, and may never have, is a way to fight the banks' latest weapon -- a growing army of bilingual tellers, loan officers and bank managers who spend as much time cultivating basic American financial literacy as they do cashing checks or closing loans.
Banks are also teaming up with local organizations to provide workshops on basic financial skills, such as reading credit card statements or filling out loan applications. In Washington, Wells Fargo, Citigroup, and Bank of America sponsor seminars at the Latino Economic Development Corp., said Erick Gutierrez, the group's director of housing.
But bank branches in neighborhoods like Mount Pleasant, pulsing with diversity, are taking the lead.
Rawi has neat packets of basil seeds stacked in the corner of his desk -- a marketing ploy for that afternoon's homebuyer workshop. "Los semillas del conocimiento," the envelope reads. "Seeds of knowledge."
"If they grow, we grow," he said.