• by Laurie Sullivan  @lauriesullivan, August 14, 2007

J.P. Morgan Chase, MasterCard and Telemundo kick off a seven-day tour Tuesday to educate Hispanic consumers in Chicago, Dallas, Houston, Phoenix and San Jose on financial responsibility.

A financial expert from the international television network Telemundo morning news show "Cada Día" will provide financial advice and tips. Attendees also have the opportunity to meet with Telemundo celebrity guests, such as Natalia Streignard, who stars in a popular Spanish soap opera.

Both Chase and MasterCard will provide information to help attendees plan for and achieve their financial goals. Chase spokesperson Tanya Madison sees the opportunity as a way to reach out to an underserved market to strengthen financial literacy.

"Hispanic consumers need to learn the financial system in the U.S. because it's different from other Latin countries, namely Mexico," says Sandro Oré, director of U.S. brand development for MasterCard Worldwide. "We want to teach the community how to get started with financial services in the United States."

For MasterCard, the service targets the 69% of the estimated 20 million Hispanic adult consumers who either have a U.S. checking or savings account, Oré says.

Wall Street analysts have mixed views on risks versus benefits when it comes to educating consumers on financial responsibility. Some believe that credit card companies have zero responsibility or moral obligation to provide insight. And institutions that do try to educate consumers sometimes go beyond the call of duty.

While some analysts believe that brands can't possibly benefit from the good deed, others suggest that informed and educated cardholders will make companies more profitable over time. "You can milk fees from the cardholder if you want to try and capitalize on uneducated consumers, but in the long run it will catch up to you," says HSBC Global research analyst Nicolas De Smet. "In the analyses we've done, if you look at the Hispanic community, they don't trust banks. They view banks as fee-income-generating machines."

The Hispanic community typically makes cash purchases. De Smet says educating consumers about the benefits of using credit cards to make payments will prove beneficial to credit card companies over time.

The service expands on educational programs already in place. MasterCard has worked with the Hispanic College Fund for more than a decade, providing direct scholarship support to more than 50 Hispanic college students. In 2004, the "MasterCard Hispanic Excellence Award" debuted, providing assistance to young Hispanic scholars. Its "Debt Know-How" program extends consumer education and credit management resources to Spanish-speaking Americans on its Web site.

Similarly, Chase has participated in efforts to provide Hispanic consumers with financial products and services. Chase recently launched "Rapid Cash," a free service to help U.S. customers send money to family members in Mexico. Chase also offers Spanish-language services, such as bilingual branch employees and customer service, credit card applications, new cardmember materials and card statements in Spanish.

Chase has a partnership* with the social network site Facebook to provide college students with tips on managing money. The company also works with Freddie Mac as the exclusive advertising sponsor in select markets of "Nuestro Barrio" (Our Neighborhood), a Spanish-language TV mini-series about Hispanic life in the United States. This series combines story lines with educational messages about important financial issues, including money management, credit and home ownership.

* Editor's note: This article has been amended since publication.