Make no mistake about it. With an ongoing de-regulation environment, intense competition among mega-convenient banks, and price category killers, credit unions must innovate to survive. Those on the cutting edge are securing market share by appealing to the fast-growing percentage of Internet users, while educating their established member base about new ways to engage. Credit unions that have approached this opportunity strategically have also cut costs in the process.
Melinda Ma has a vision for Southland Credit Union ($344M in Downey, CA). As the director of e-commerce, she believes in the "virtual branch." The credit union most recently launched UPost, the online technology that allows qualified users to post deposits on the web to their account for immediate credit and mailing in the deposited check. "We're turning the PC into an ATM," she says.
The eDeposit program has significantly reduced the amount of travel time for members, in some cases eliminating travel time completely. The eDeposits program is part of a coordinated marketing campaign that includes multi-channel e-marketing, automated requests and customer surveys.
While certain technologies such as online banking are a “no-brainer,” emerging technologies challenge credit unions to evaluate their online channel on many levels beyond integration with core processors. Whether they are early-adopters or conservative observers, fast growing credit unions are taking innovative approaches to evaluating online technologies. Before even proposing the new addition, they carefully consider the strategic and operational risks, member adoption potential, staff education, and marketing.
After a five-year flat growth period, Vonda Burkart, CFO of Employees Credit Union ($49M in Dallas, TX) and the ECU executive team decided that one component of adding services and growing would be to make almost all services available through their website . Through instant online member enrollment, account-to-account and other online vehicles, the credit union has seen faster growing loans and assets than its peer group – all without increasing staff. Burkhart believes these technology decisions should not be based on ROI and other such methodical indicators. “It’s not about, ‘How do I get more members?’ It’s about how you serve your current members. And it’s not the number of bodies. It’s what those bodies are doing.”
On the more conservative side, Chris Jenkinson, IT manager of Citizens First ($261M in Oshkosh, WI) takes a methodic and structured approach that considers how the new technology fits with all other departments and projects.
“We begin with our primary credit union goal, then determine deliverables to reach that goal, and then determine critical measurements to track every month.” Jenkinson uses the project management tool Connections Online to track technology initiatives and sees implementation as a continuous process. “The biggest thing is follow-up and continued monitoring,” says Jenkinson. “It’s not just install it and hand the key to someone else.”
As technology continues to evolve at faster speeds, credit unions’ ability to strategically choose what technologies it adopts will be the most critical survival skill.