Things to Do Now

Credit unions continually need to be changing and improving. In no particular order, here are four things which I think most credit unions should be considering right now.

 
 

Credit unions continually need to be changing and improving. In no particular order, here are four things which I think most credit unions should be considering right now.

1. Ramp up Political Action. There is no way for us to protect the turf we have without knowing the Congress and state legislatures would not dare take some of it away from us. The only way to do this is to be the prevailing lobbyist.

The way I propose to do this is to seek $1 from every credit union member. With this, we can lay claim to an effective lobbying effort.

We need more people to do the political work. We have to remind politicians that we are very rich in members and that members cast votes.

2. Get All Mortgages. We have to make it a top priority to get the mortgage of every member. We have to go after those mortgages, to buy them or persuade the member to switch, in other words to do whatever it takes to get 100% of the mortgages of our membership. We should be making mortgages the bedrock of members' relationship with the credit union.

This doesn't mean forgetting about the members who don't have a mortgage; our message to them is that by reeling in 100% of mortgages we make the credit union stronger for everyone.

Fortunately, 1) people increasingly do not see mortgages as a lifelong thing, and 2) technology is making it easier to help people switch mortgages to a credit union. See the next point.

3. Vastly Improve Small Business Lending and Small Business Accounts. Again, we need to acquire the expertise for this; it has to be in our future. Every year more and more of our members are small business people. Other members -- and non-members -- are making new small businesses every day. We need to attract them to the best servicing financial institution for small business, namely credit unions.

4. Market a New Message. Here is what we should be marketing: ''We are the country's best kept secret, and you can join.''

For too long, we let on that credit unions were exclusive, that only certain people (fortunate ones) could join. We have to reverse this entirely. We have to say that we are not exclusive any more, that the barriers to membership are very low. We have to say that these days, it is not the fortunate person who can join but that nearly anyone can, that it is the rare person who cannot.

We should be doing these things now. They will make your credit union stronger. They will make the movement stronger.

 

 

 

Dec. 30, 2002


Comments

 
 
 
  • Same mentality of S&Ls in the 80's. They went for services that were out of their "niche" and look at what happened. I was a S&L executive in those days, I don't want to see it repeated in the credit union industry. The S&L's that stayed with Savings and Mortgage Loans and didn't get into the "business" activities are still with us today.
    Anonymous
     
     
     
  • But remember -- you cannot be ALL things to ALL people. Credit unions are expanding their fields of membership all over the country. And yes, credit unions have been the best kept secret forever -- but don't confuse field of membership with your target audience. If you expand to include your entire State (for example) who within that State are you going to target? What's your niche? Figure out what you do best, crank it up, and forget about the rest!
    Anonymous
     
     
     
  • However, Mr. Callahan should have used some qualifiers on mortgage loans. For example, credit unions should not be loading up on low rate mortgages and holding those on their books. They should be selling them and possibly retaining the servicing. I believe this might be what his credit union is doing. For him to make a blanket statement to make all the mortgages you can could be interpreted by some credit union managers incorrectly.
    Anonymous
     
     
     
  • How about marketing to the largest growing minority group in the country...Hispanics? I translate marketing materials for credit unions. If interested in having your marketing message available in Spanish, email mfalcon13@prodigy.net.
    Anonymous
     
     
     
  • I agree that mortgages are a core product and can help retain a member's business - however - this should not be done regardless of price/rate. In today's low rate environment, fixed rate, long-term mortgages can cause future problems if not handled appropriately. E.g., Mr. Callahan should mention a few more details such as, fixed rate or ARMs, what happens after originating the mortgage (selling w/ servicing retained, or leveraging w/ FHLB borrowings, etc.). If a credit union has 20%-30% of its assets in long-term fixed rate mortgages, its strategy probably should not be to get every mortgage of every member.
    Anonymous
     
     
     
  • Interesting concept on Mortgages
    Anonymous
     
     
     
  • Credit Unions also need to understand how to hire and train their people to sell these concepts to their members.
    Anonymous