Here’s a look at how credits unions are making business members’ dreams come true.

A Multi-Sector Collaboration Takes Shape In St. Louis

St. Louis Community Credit Union ($433.6M, St. Louis, MO) is expanding affordable business lending thanks to a multi-sector partnership with some of the biggest employers in the community.

The three anchor institutions — BJC Health System, SSM Health, and the James S. McDonnell Foundation — are supplying nearly $15 million in low-cost deposits to SLCCU’s Community Impact Deposit program, boosting access to working capital, equipment, and real estate loans for underrepresented businesses.

Since its launch in 2022, the program has attracted more than $30 million in new deposits across private, public, and philanthropic entities. In turn, the credit union has used this money to fund a portion of the more than $40 million in business loans it issued during the same period.

The Missouri cooperative is a CDFI in addition to being a Black-owned Minority Depository Institution (MDI), and a full 90% of all business loans issued during this period have assisted Black-owned businesses.

In-Branch Kiosks Provide Valuable Visibility

City & County Credit Union ($1.2B, St. Paul, MN) has long used its branch locations as more than just transactional spaces. For more than a decade, several of its branches have sponsored a “Business of the Month” kiosk program that invites local businesses and nonprofits to display their offerings, interact with members, and build community awareness.

The program operates with careful structure: Participating businesses must include a call to action, such as QR codes or drawings, and meet weekly check-in standards for their display and engagement. Although the credit union doesn’t formally track ROI for the kiosk effort, leadership says the program has helped raise its brand awareness, sharpen its small-business product focus, and deepen its ties to the local entrepreneurial ecosystem.

Learn how the in-branch business kiosk reinforces a commitment to community prosperity in “Small Business Meets Big Community At City & County Credit Union.”

Support For Reno Entrepreneurs And Innovation

Greater Nevada Credit Union ($1.7B, Carson City, NV) will maintain its top-level sponsorship for Nevada’s Center for Entrepreneurship and Technology (NCET) in 2026 while also sponsoring NCET’s Innovation Summit during Reno Startup Week.

As a nonprofit organization, the NCET relies on this partnership and others to continue offering programs, events, and networking opportunities for the Reno business community. The Innovation Leader sponsorship level is only available to two entities each year.

John Ahdunko, senior vice president of member success, says the cooperative is proud to be a part of a partnership that supports entrepreneurs and technological innovation.

“This collaboration aligns with our passion to help more Nevadans live greater by fostering innovation and local business growth,” he told Nevada Business magazine in August.

More Grant Programs. More Grant Money.

It’s difficult to overstate the impact of grant money on small businesses and startups. The support not only reduces the pressure of debt and the risk of failure but also enables job creation, contributing to the overall health of the local economy.

InRoads Credit Union’s ($333.2M, St. Helens, OR) small business grant program launched this fall gives local entrepreneurs the chance to apply for one of 11 grants ranging from $1,000 to $5,000. The credit union will award $25,000 in total funding. Applicants must have been in business in Columbia County for at least one year and generate an annual gross income of less than $1 million.

To further its commitment to local entrepreneurs, InRoads also waived all small business loan origination fees from Sept. 15 through Nov. 15 across its entire field of membership.

Meanwhile, Verity Credit Union ($769.3M, Seattle, WA) is expanding its popular micro grant program to include both nonprofits and microbusinesses.

In a press release, CEO Tonita Webb says the goal of Grants For Growth is to empower local businesses and nonprofits to grow in a way that honors their values and strengthens the region.

“Through this initiative, we seek to give business owners and nonprofit leaders support, building confidence and camaraderie,” she says.

The microbusiness grant ranges from $7,000 to $10,000 in flexible funding and relationship support for businesses with less than $1 million in revenue and fewer than 10 employees. Eligible applicants include BIPOC-,LGBTQ+-, and veteran-owned businesses that have been operating for less than five years.

The nonprofit grant offers up to $5,000 in funding and support for grassroots 501(c)(3) organizations with assets less than $250,000 that serve historically marginalized groups. Applicants should focus on advancing social justice, environmental justice, equity, or financial wellness.

Your Next Great Idea Is A Roundtable Away. Credit unions are responding to the evolving needs of members with a variety of products and services. Callahan Roundtables put leaders in the same room to share solutions, solicit feedback, pose questions, and more. Learn more about Callahan Roundtables.

The post 3 Ways Credit Unions Showed Up For Small Businesses In 2025 appeared first on CreditUnions.com.

A CDFI since 2018, Lake Trust’s microloan offerings include business vehicle loans, signature loans, lines of credit, secured loans, and business credit cards — all designed to address critical funding gaps in small business lending. Since launching these programs in 2019, Lake Trust has provided more than $22 million in loans, fostering the growth of local entrepreneurs like custom bow-tie maker Nikhil in Detroit and Marcus Leslie, whose cheesecakes transitioned from farmers’ markets to major retailers.

By simplifying the lending process and building relationships within the community, Lake Trust continues to empower small businesses to thrive.

Watch the video to hear more inspiring stories and learn about the credit union’s innovative approach to advancing Michigan’s entrepreneurial spirit.

Compare Your Lending Strategy Against True CDFI Peer Groups. Are you a CDFI struggling to find meaningful comparisons for performance benchmarking? Callahan’s Peer Suite allows users to create a custom peer group of CDFIs in minutes and compare key metrics like membership, loan, and share growth. Let us show you how. We’ll even provide a free performance report for you to keep at the end of the session. Learn more today.

The post Michigan Microloans Empower Small Business Success appeared first on CreditUnions.com.

Helping women to build financial security is a strategic focus for Summit Credit Union ($6.9B, Cottage Grove, WI). For years, the cooperative has offered financial education, training, and support for male and female consumers and small business owners. But in November 2023, Summit partnered with the startup StartingBlock to launch Fellowship for Women Entrepreneurs, a one-year program that provides mentorship, workspace, workshops, and training for female business owners.

The Right Fit, Right In Summit’s Backyard

The fellowship aligns with Summit’s mission and financial education offerings that help retail and commercial members in areas such as wealth management, home loans, and financial security.

Through conversations with StartingBlock, a startup hub for Madison-area entrepreneurs, Summit learned about the hub’s desire to create a curriculum specifically for women entrepreneurs. From there, both organizations worked together to launch the program.

“We saw a strong parallel between the fellowship and a program called Project Money that we offer on our consumer side,” says Ric Mathias, chief services officer at Summit. “Through that program, we help families build credit, decrease debt and increase savings in a 12-month period.”

How It Works

StartingBlock created a foundational curriculum for all fellows, and Summit acts as an additional resource to help business owners move from ideation to action.

“We act as a sounding board based on where their business is,” Mathias says.

During the program, fellows learn about how to scale and grow their businesses. However, because participants are at different stages of the business cycle, the support they receive from their mentors is highly customized.

“We mold our support to each entrepreneur,” says Vincent Rice, vice president of community and business impact at Summit. “Mentors from the credit union include marketing, operations, learning and development, and more. It’s all predicated on that entrepreneur’s current needs.”

Rice, who leads the initiative for the credit union, meets with StartingBlock monthly. Mentors attend quarterly sessions with their mentees to ensure they remain aligned with the core curriculum. These formal meetings usually include a lunch to engage all parties and encourage conversations.

“We don’t want to inundate the fellows with too much information or force things,” Rice says. “How mentors and fellows communicate in between meetings is driven by those quarterly interactions.”

The credit union also wants to make sure mentors are providing sound advice that doesn’t supersede StartingBlock guidance or unnecessarily narrow the scope of conversations.

“As a business owner, you might get multiple recommendations as you wrestle with certain decisions,” Rice says. “Ultimately, it’s up to the fellow to take in as much insight and feedback as they can and make the best decision for their business.”

So far, mentors — who take on the volunteer responsibility in addition to their day job — report fellows are appreciative of the advice they are receiving.

Still, the needs of a fellow might necessitate the credit union nudge its leaders with specific skillsets who might not yet have raised their hand to volunteer. To that end, Summit is focusing on ensuring mentors have a strong understanding about what they need to bring to the table. For example, the cooperative will be developing FAQs to help mentors and fellows alike better understand the boundaries of the relationship and the level of support the credit union can provide.

Success Measures And Impact

Currently, seven women entrepreneurs are participating in the program. StartingBlock is tracking the number of training sessions they complete, other startup hub events in which fellows participate, and the overall engagement level of participants.

Summit plans to measure the program’s success in a few different ways, including how it’s helping the credit union reach its target market. Specific metrics will include improvements in the lifetime earnings and savings of women, the number of businesses starting up within the community, the success and growth of fellows moving beyond the program, and future commercial lending or business services opportunities.

One of the fellows is already a Summit Credit Union member with a loan, and Mathias and Rice expect the credit union will have more opportunities to serve commercial lending and other business needs down the road.

According to the Summit leaders, programs like this help cooperatives get closer to those they serve and identify hurdles they encounter. The feedback from the fellows will enable Summit to ensure it has the right educational resources, tools, and product solutions to help all its members succeed.

For startups, the sheer number of resources available to them can be overwhelming. Summit’s goal is to help them figure out where to start, which resources to use when, and how to build on the core curriculum StartingBlock has developed.

“Programs like these are powerful examples of putting strategy and tactics into real-life scenarios,” Mathias says. “As a parallel example, serving on the consumer side as a Project Money coach was one of the most rewarding experiences I’ve had.”

Best Practices

Rice advises others interested in creating a similar program to be clear about expectations from the beginning.

“Things can get unwieldy if you try to do everything for everyone,” he says.

That applies to not only mentors and mentees but also the larger partnerships, such as between the credit union and StartingBlock. Clearly defining the program’s scope, desired outcome, and the roles and responsibilities of all parties helps ensure everyone is living up to expectations and maximizing the value of the program.

The post Women Take A Bite Out Of Business In The Badger State appeared first on CreditUnions.com.

Top-Level Takeaways

• Business lending can be an important component of a balanced loan portfolio.
• Such lending, however, requires specialized talent to serve deserving, underserved borrowers.
• For some credit unions, SBA lending serves as a jumping-off point for working with small businesses.

Credit unions across the country are committed to helping business owners thrive. Such a stance helps cooperatives improve their capabilities for and deepen their relationships with enterprises both small and large.

In Utah, America First Federal Credit Union ($19.3B, Riverdale, UT) counts approximately 80,000 businesses among its total membership of almost 1.4 million. Its business loan portfolio of $1.4 billion currently includes 296 SBA loans with a total balance of nearly $250 million, of which roughly 75% is guaranteed.

“The guarantee allows us to work with borrowers who have a good business but lack the strength that having their own capital provides,” says Blake Weathers, senior vice president of commercial lending at America First. “It makes it possible for small businesses or less established businesses to grow.”

Across the country, Arlington Community Federal Credit Union ($468.3M, Falls Church, VA), has been offering business loans since it gained a community charter in 2009. Its SBA engagement reached a peak during the pandemic, when it funded 283 loans through the Paycheck Protection Program. It currently has approximately 950 business members.

“This effort allowed us to support numerous businesses that were unable to get assistance from their banks,” says Kevin Sheffield, the Virginia cooperative’s business lending manager.

Sheffield has been with Arlington Community for seven years and transferred from another business unit to help the credit union handle the PPP crush. Since then, he’s gained an appreciation of the differences between SBA and conventional lending. SBA loans, for example, require detailed business plans, financial statements, and other documentation around eligibility and ability to repay. In exchange, the lender gets a government guarantee and the borrower often gets lower down payments and longer repayment periods.

Meeting Guidelines, Acquiring Talent

The SBA loan process can be complex. Documentation, requirements, and review can be quite extensive compared to conventional loans, Sheffield say, and it’s up to lenders to understand the intricacies.

“We have a team of experienced professionals who specialize in SBA lending and have established partnerships with key players in the SBA lending community,” Sheffield says. “This allows us to quickly identify loans that will or will not qualify, streamlining the process for our members.”

America First, meanwhile, has been involved with small business lending since Weathers joined the credit union in the mid-1980s. As the head of business lending — the credit union split lending from business services approximately three years ago — Weather leads a team that is scattered across the credit union’s home state of Utah as well as the other five states in which America First has a field of membership. According to Weather, SBA lending requires specialized talent to keep up with the “ever-changing” government program. That type of talent is difficult to cultivate internally.

“Trying to have someone learn SBA lending in-house has never worked for anyone as far as I know,” Weathers says. “We had to acquire and pay for people that work in that specific industry.”

Do’s And Don’ts For B2B Success

Indeed, working in business lending and services is a specialty that deserves its own level of attention, from developing and sustaining the appropriate range of products and services to ensuring the right people are in place to build and sustain relationships with those members.

According to Weathers, that starts with having a strategy.

“Hire and pay talent to develop and execute a plan of action,” the lending SVP says. “Along the way, check your markers of success and adjust as needed. Treat it like a business on its own instead of having an employee add it to their already busy job.”

Sheffield at Arlington Community offers further insight into business lending.

Do:

• Collaborate with consultants or partners to establish robust policies, procedures, LOS, underwriting, and other essential frameworks.
• Develop a clear strategy and niche to guide the credit union’s operations and services.
• Listen attentively to members to understand their needs and challenges, then offer personalized solutions and services that cater to small businesses’ specific requirements.

Don’t:

• Neglect the importance of building strong relationships with members.
• Offer one-size-fits-all solutions that might not meet the needs of small businesses.
• Ignore the impact of industry trends and regulations on the credit union’s offerings and operations.

Serving Businesses Serves The Community

Serving businesses serves the entire community, and the reach can be broad. America First’s business members include accommodation and food services companies, health care and social assistance providers, construction, manufacturing, retail, transportation, and warehousing, “just to name a few,” Weathers says.

“We do small loans for Visas and lines of credit in the hundreds of dollars up to commercial loans in the multi-millions,” the veteran Utah lender says. “Each business is different and run differently and each has their own needs and wants. Relationships need to be built over time and the business owner needs you to understand their business. The better we as lenders do, the better we can help them.”

Arlington Community’s business members are a similar mix of enterprises. Sheffield says its largest is a real estate holding company with a loan of more than $1 million and the smallest is a nonprofit with a $20,000 loan.

“It’s worth noting that our niche is small business lending, an area often overlooked by larger commercial banks that primarily focus on larger loans,” Sheffield says. “Although we do have larger loans in our portfolio, we strive to serve and support the typically underserved small business sector.”

Affordable financial solutions and personalized service helps those small businesses succeed — and that contributes to the community’s economic vitality, Sheffield says.

“This commitment reflects ACFCU’s core values of community service and member empowerment, driving positive change for all members,” he says.

Is It Time To Evaluate Your Lending Strategies?

Use industry data to determine how your credit union performs against others, uncover new areas of opportunity, and support your strategic initiatives. Callahan’s credit union advisors are ready to show you how — are you ready to see how you stack up?

Request A Demo

The post The Power Of Business Lending And Services appeared first on CreditUnions.com.

• In the past two-and-a-half years, Tulsa Federal Credit Union has expanded business lending from approximately 15 members with $12 million in balances to 250 with $100 million.

• This growth does not reflect activity via the paycheck protection program, for which Tulsa FU was the top credit union lender in Oklahoma.

CU QUICK FACTS

Tulsa FCU
Data as of 06.30.20

HQ: Tulsa, OK
ASSETS: $838.6M
MEMBERS: 55,232
BRANCHES: 14
12-MO SHARE GROWTH: 6.5%
12-MO LOAN GROWTH: 0.6%
ROA: 0.16%

To combat the potential long-term deleterious effects of the coronavirus on the American economy, U.S. lawmakers passed the Coronavirus Aid, Relief, and Economic Security (CARES) Act in March 2020. The act established a $659 billion fund to provide businessloans to cover staffing and other costs.

On July 6, the Treasury Department released data about lenders as well as borrowers who participated in the Paycheck Protection Program. Callahan & Associates has published information about the number of jobs credit unions helped save through PPP lending more than 11 million as well as the top credit union PPP lenders by state and the top credit union PPP lenders by asset size.

Callahan also hosted a panel discussion with five credit unions that have participate in PPP lending. These cooperatives of varying sizes and geographic regions discussed how the paycheck protection program helped strengthen their business relationshipsand how cooperatives can support small businesses moving forward.

Now, lenders are turning their attention to the next big PPP hurdle: loan forgiveness.

Here, Brendon Maguffee, chief lending officer for Tulsa Federal Credit Union($838.6M, Tulsa, OK) talks about his credit union’s approach to forgiveness and offerinsights from Tulsa FCU’s PPP lending experience.

Talk about the credit union’s history of offering business loans.

Brendon Maguffee, CLO, Tulsa FCU

Brendon Maguffee: The credit union wasn’t in that space prior to my arrival two-and-a-half years ago. However, when the NCUA ruling changed in January 2017 to allow credit unions to compete more closely with community banks on commerciallending, Tulsa FCU saw it as a great opportunity to start a commercial line of business.

I was attracted to the credit union’s focus on people over profits and was able to bring my banking industry background to the table. Since then, we’ve grown from approximately 15 business members and $12 million in commercial loans to approximately250 business members and a total of $100 million in commercial loans. This doesn’t count the new PPP members.

Offering PPP loans was a challenge for many organizations. How did your credit union adapt quickly to serve members?

BM: It was definitely a challenge. This was a program that impacted more than 6 million businesses nationwide and happened within a three-month span. However, we were able to facilitate a good experience for our business members and actuallyhad larger banks referring business owners to us because they knew our team would take care of them in a timely manner.

We’re processing the forgiveness applications as we receive them. This is something some of the banks just aren’t doing they’re not accepting forgiveness applications even if a business owner wants to get a jump on it.

Our team has expanded over the past two-and-a-half years from one individual focused on commercial lending to eight, including two commercial lenders, a credit analyst, two commercial loan specialists, a post closer, and a director of treasury and businessservices

I reached out to a previous colleague who is an SBA loan officer, and he walked me through E-Tran [the loan servicing portal of the U.S. Small Business Administration] so I could train all my loan officers. When the second round came out, we pounded outapplications as fast as we could. We were up at 1 a.m. or 2 a.m. for multiple days. We processed 254 PPP loans, most in a two-week timeframe, with only four exceeding $150,000. Whereas I don’t envy any of us, it was our job as partners in ourcommunity to facilitate this.

What are you doing about PPP loan forgiveness?

BM: We’re working through the forgiveness portion now and moving forward even as it might continue to change. We just sent a tailored email to every PPP recipient that we serviced letting them know they have 10 months from theircovered period and it might be advisable to wait and see if legislation on forgiveness changes. However, we want to serve our members who choose to be proactive, and we have made the forgiveness applications and instructions available on our website. We’re processing the forgiveness applications as we receive them. This is something some of the banks just aren’t doing they’re not accepting forgiveness applications even if a business ownerwants to get a jump on it.

We have started processing our first few forgiveness applications. Based on the volume and expanded timeframe, we’re doing them directly ourselves. We also have 60 days from receiving an application to make a decision, so we can stagger them accordingly.We are still advising members that it might be beneficial to wait, but some might want to get started or just put this all behind them. Regardless, we’re pointing every member to the new, free, online PPP forgiveness tool, www.pppforgivenesstool.com. It is intuitive and allows members to print a PDF with all their supporting documentation.

How has the paycheck protection program helped Tulsa FCU build new relationships with small businesses or strengthen your existing relationships?

BM: Probably 75% of the PPP loans we made were for non-members. The message to the community was clear: we were able to facilitate these when their FI couldn’t do it in a timely manner. It’s already a challenge to keep up,frankly, as dissatisfied bank clients move their home loans and other accounts to us after having a positive PPP experience. The increased amount of business on top of normal operating activity is not something I could have predicted, but it is positive for the membership and our employees.

What are some lessons you learned from your PPP experience that might be applicable to other credit unions as they try to serve small business members in the future?

BM: It’s imperative to have a relationship with the SBA. That’s one of the reasons we were successful our representative helped us navigate PPP. It’s not very cumbersome to become SBA express approved, so I recommendfamiliarizing yourself with that process, especially if you want to spur economic development in the community and be certified for new programs it might launch down the road.

It’s also important to have a back-up plan. We learned through PPP that CUSO or vendor partners might not always have the infrastructure needed to serve members. Credit unions must have a response if their vendor can’t facilitate a solution,even if it’s just a referral to another lender. You can often preserve the larger relationship if you’re honest and give them a warm hand-off to someone else who can serve their immediate needs in a timely manner.

The post Tips To Prepare For PPP Forgiveness appeared first on CreditUnions.com.

• Despite challenges, credit unions found ways to adapt and meet the needs of their current members and local small business owners.

• From funding more loans than any other lender in its state to approving 100% of applications, each of these vastly different-sized institutions had an outsized impact on their local communities.

• All five have seen additional commercial accounts move to the credit union as small businesses recognize and benefit from the relationship-driven cooperative difference.

After analyzing Treasury Department data on the number of jobs saved by credit union lending and publishingan overview of the top cooperative lenders by state and nationally for the Paycheck Protection Program (PPP), we spoke at length with five credit unions of various sizes and geographic regions to learn how the program has helped their institutions strengthen business relationships moving forward.

A History of Serving Small Businesses

One thing all five credit unions have in common is a history of offering business services, specifically loans and deposit accounts.

CU QUICK FACTS

Mountain America Credit Union
Data as of 06.30.20

HQ: Sandy, UT
ASSETS: $11.0B
MEMBERS: 915,673
BRANCHES:97
12-MO SHARE GROWTH: 23.7%
12-MO LOAN GROWTH: 20.3%
ROA: 1.31%

Mountain America Credit Union($11.0B, Sandy, UT) has offered business loans for over 25 years and business deposit accounts since 2002. With roughly 60,000 business members and over 9,000 commercial loans, one of the largest credit union PPP lender notes that they have seen many repeat borrowers over the years.

VyStar Credit Union($9.5B, Jacksonville, FL) has been serving small business for about 10 years, though its specific focus on business lending has calcified in the past five years. Through its concerted efforts, the cooperative’s business loan portfolio has grown from $200 million in 2018 to nearly $800 million today.

Idaho Central Credit Union ($6.0B, Chubbuck, ID) has been offering business loans and services since 2008. Their current portfolio consists of over $800 millionin member business deposits and over $700 million in business loan exposure. The cooperative has more than 20,000 business accounts with a good percentage of those members using Idaho Central as their primary financial institution.

BHCU ($194.2M, Ridley Park, PA) has been offering business services for nearly five years. Their Delaware County field of membership is full of traditional small businessesand the credit union serves approximately 500 of them. Its business members include mom and pop shops, plumbers, electricians, and contractors, businesses that are most likely to be underserved or underbanked by larger financial institutions. Thecooperative provides these members with more than just a loan, as delivering real value for businesses is part of its brand promise.

Platinum Federal Credit Union ($179.2M, Duluth, GA) is a relatively young credit union established twenty years ago to serve the small business community. A highpercentage of their approximately 1,200 business accounts are used as primary checking accounts by retail businesses with heavy cash needs, including local small businesses that sell money orders. This has led the cooperative to partner with armoredservices, offering same day credits and cash pick-ups. Platinum believes these are much-needed services that many banks have eschewed in recent years, providing an opportunity for credit unions.

Addressing Immediate Needs, Overcoming PPP Challenges

It taxed all of us and took courage to be the first to launch, says Mike Turner, CLO for Mountain America. Even without complete information from the Small Business Administration (SBA), the cooperative began using its own application. Inaddition, its leaders reached out internally for reinforcements to handle the volume. Training was quickly rolled out and all areas of the credit union lent support. We rallied the troops and just did it, Turner says. Those troops workedaround the clock for several weeks; knowing that the intense pace would not last forever, MACU also tried to support staff by bringing food in and ensuring breaks were taken along the way.

It was a lot of blood, sweat and tears, says Jenny Vipperman, CLO for VyStar Credit Union. Despite its status as an approved SBA lender, the credit union had never originated an SBA loan prior to PPP’s beginnings. Instead, the cooperative relied on a vendor partner to handle SBA originations and planned to do the same with PPP as all their internal business lending resources were supporting a partnership with the city of Jacksonville. A single day into PPP, however, that partner couldn’t handle the volume and had to shut down. Our chief experience officer, chief information officer, and I got together and decided that we were going to originate these ourselves, says Vipperman. That meant leaders spent nights and weekendsworking with programmers to create a new application process utilizing bots a team of 20 held calls several times a day to make it work. But once the newly developed app was up and running, there was another curveball for the credit union to address: the SBA had shut down the use of bots.

We had a great staff of commercial underwriters, processors, and loan officers that were able to learn the program and get it off the ground fast. As we began to see a flood of applications, we mobilized employees from throughout the organization to assist the commercial team in processing them.

At that point, we had 75 people take on the manual work, says Vipperman. Again, that required working nights to manually enter applications in the SBA’s system, which was crashing during the day. My CEO, myself, so many of uswere doing this because we had to serve our members, she says. This was especially important as some members who applied early on through the credit union’s vendor had to reapply. It wasn’t until current business members and VyStar’s 750,000 retail members were squared away, that the cooperative opened PPP applications to the entire community. We encouraged everyone to apply, whether they had one employee or 500, notes Vipperman. A small-business friendly process whereby applicants picked up a pack through the drive-thru in the afternoon, returned it the following morning, and received funding that same night resulted in 4,500 approvals by mid-June.

For Idaho Central Credit Union, its executive management’s ability to devote time and resources to PPP, along with help from an in-house team, made all the difference. We had a great staff of commercial underwriters, processors, and loan officers that were able to learn the program and get it off the ground fast. As we began to see a flood of applications, we mobilized employees from throughout the organization to assist the commercial team in processing them, says Jarom Campbell, vice president of commercial credit administration at the Gem State cooperative.

CU QUICK FACTS

VyStar Credit Union
Data as of 06.30.20

HQ: Jacksonville, FL
ASSETS: $9.5B
MEMBERS: 721,138
BRANCHES:77
12-MO SHARE GROWTH: 27.2%
12-MO LOAN GROWTH: 20.1%
ROA: 0.79%

To put the PPP volume in perspective, Idaho Central makes approximately 1,300 business loans per year. The cooperative,which made more PPP loans than any other lender in its state,

BHCU was also ready to move quickly with seasoned commercial lenders on staff. We were already in the process of becoming an SBA-approved lender and I’m a commercial guy by trade, says Gary Golden, the credit union’s CEO. His personal experience, along with the expertise of credit officer, Jerry Dorn, allowed the Pennsylvania cooperative to pivot without much difficulty. They also leveraged relationships with other financial service companies, including Member Business Financial Services (MBFS), to get the applications processed quickly.

Platinum FCU’s decision to become an SBA lender in 2020 a process they began in 2019 made for a seamless process and allowed them to quickly jump into the PPP. We were able to email members about PPP before the official launch date because we were already SBA members, says Kabir Laiwalla, Platinum’s CEO. The credit union’s consumer lending manager, chief lending officer, and the CEO himself were able to distribute the work and create a supply chain whereby one person took applications and the others reviewed them and communicated with business members. The Georgia cooperative also made use of third parties such as Leverage and MBFS to assist with the SBA side of the process, allowing Platinum to remain focused on their members. Laiwalla notes that becoming an SBA lender is much easier today than when he first considered it back in 2005. We applied at the beginning of 2020 and got our license and approval in 2-3 days, he says. I highly recommend other credit unions consider it.

Cementing Existing Relationships & Opening The Door To New Ones

CU QUICK FACTS

Idaho Central Credit Union
Data as of 06.30.20

HQ: Chubbuck, ID
ASSETS: $6.0B
MEMBERS: 405,589
BRANCHES:38
12-MO SHARE GROWTH: 33.6%
12-MO LOAN GROWTH: 21.9%
ROA: 1.43%

MACU saw the PPP loans as a clear way to live their mission of being there for members. The cooperative funded 7,000 loans with an average amount of $50,000 for both existing and new members alike. It was rewarding when we received countless emails and letters thanking us for being there when other financial institutions were not, says Turner. And because of that positive experience, many credit unions saw interest from those businesses, who wanted to know more about what their cooperative could offer.

It absolutely helped us bring new business into the fold, says VyStar’s Vipperman. The commercial team has since been reaching out to those who got first-time loans through PPP and already has dozens of businesses interested in refinancing other loans and moving their relationship to the credit union. Overall, 97% of the loans VyStar funded were under $150,000 with a few large loans going to local non-profits. A stark contrast to stories of large chains receiving millions in funding from big banks.

Idaho Central has also received an overwhelming response to their involvement. We have received stories from all over the state about how we were able to help save jobs, help save businesses, and help save Idaho, says Campbell. As one of the first financial institutions in the state to get up and running, word spread like wildfire across the business landscape and non-members began asking for help from the credit union when their banks weren’t up and running. As a result, Idaho Central helped more than 800 new business members secure a PPP loan. Those businesses are now in the process of moving over their entire relationship. We are hearing the same thing from our existing business members, that we stepped up and helped save their business, Campbell says.

We couldn’t have done this with just my lending team, we had representation from every single department who all stepped up and volunteered to help us.

BHCU’s PPP loans were split nearly 50/50 between new members and existing members. We solved a big problem for them, especially those who came to us after getting nowhere with their primary bank, says Golden. For the credit union,this was a huge source of new business and an opportunity to showcase the cooperative difference. After approving every single application, BHCU has found that they not only have new business members, but new retail members joining. When you’re there for someone in a crisis, they remember that, says Golden. He’s seen first-hand business members who are now also moving their personal accounts to BHCU and encouraging family and friends to do the same. While the effort was herculean and involved midnight and 2 a.m. emails responding to members, it was worth it according to the Pennsylvania cooperative. Now, businesses want to hear from BHCU and understand they are an organization built on service and relationships, not just transactions.

Of the more than 500 PPP loans Platinum FCU funded, about 150 were new business members. We had several members who only had personal accounts. We’ve already started working on new SBA loans from those new business member relationships, says Laiwalla. Since the credit union mainly serves smaller businesses, their average loan size was just $25,000 and the smallest loan they funded was $1,200. After processing the first and second waves of PPP, the credit union focused its efforts on educating members to ensure smaller businesses, who may not be used to taking loans at all, clearly understood what they could use the funds for and what they could not.

Lessons Learned, How to Serve Small Businesses In The Future

CU QUICK FACTS

Platinum FCU
Data as of 06.30.20

HQ: Duluth, GA
ASSETS: $179.2M
MEMBERS: 10,032
BRANCHES: 5
12-MO SHARE GROWTH: 52.0%
12-MO LOAN GROWTH: 24.7%
ROA: 1.50%

Despite ongoing economic uncertainty, MACU’s philosophy is still to serve all members, including small businesses. Unlike some institutions who decided to stop making certain types of loans, the Utah-based cooperative is making slight adjustmentsto loan-to-value ratios and looking more closely at potential loans to protect member assets and serve business needs responsibly. We look for ways to make loans, not pull the rug out from under small businesses, says Turner. The abilityto make local decisions and act nimbly are two advantages of working with MACU.

VyStar has always been a conservative lender and is continuing to do their part to protect both members and the institution particularly on the real estate side of its portfolio. We’re focusing on members’ existing loans andmaking sure we work with them on forbearances or modifications to keep them in a good place, says Vipperman. Overall, the PPP experience taught the chief lending officer that no one can go it alone when it comes to meeting immediate memberneeds. We couldn’t have done this with just my lending team, we had representation from every single department who all stepped up and volunteered to help us. The credit union’s philosophy of making what’s importantto the members important to the institution helped clear the way for this proactive assistance. None of this we could have accomplished if people didn’t work together. That’s how all of us are going to get through this, saysVipperman.

Upcoming Webinar: How To Serve Small Business – Insights From Successful PPP Lenders

Join us for a webinar on August 27 at 2:00 p.m. ET to learn how credit unions can help local business owners during their time of need while showcasing the credit union difference.

Register Today

For Idaho Central, having a competent business and treasury management team, along with over 10 years of business banking experience and cutting-edge IT resources have been key to success. Business members are worried. We need to be there for themas they navigate this new financial landscape we all find ourselves in, says Campbell. The top in-state PPP lender learned several valuable lessons centered around automation for loan applications, and tweaked their process almost daily withthe IT department as its internal teams searched for ways to do things quicker and more efficiently. This was a game changer for us and allowed us to help even more Idaho small businesses, he says.

BHCU hasn’t made any philosophical changes to their business lending model, but is asking more questions than years past to understand and evaluate new loans. You can’t simply look at 2018 and 2019 performance, especially in industrieslike food service. You need to understand what cash flow looks like today and what the expectations are now, says Golden.

The PPP process, while challenging, validated the ability of credit unions like BHCU to compete with the larger banks and differentiate with small businesses. The way many banks treated smaller businesses some even telling them to comeback in a month to apply for a non-PPP loan proved my point that we’re a good alternative, says Golden. The Pennsylvania cooperative didn’t tell anyone to wait or turn away a single small business for any type of loan request,as it’s simply not in their nature.

CU QUICK FACTS

BHCU
Data as of 06.30.20

HQ: Ridley Park, PA
ASSETS: $194.2M
MEMBERS: 8,298
BRANCHES: 2
12-MO SHARE GROWTH: 22.5%
12-MO LOAN GROWTH: 8.7%
ROA: 0.64%

Platinum FCU is continuing to serve business members, while at the same time beefing up their allowance for loan losses, adopting some of the new self-employed guidelines introduced recently for mortgages into their commercial products, and pausing its$100,000 unsecured line of credit. The SBA commission earned through PPP has helped the credit union increase its loan loss allowance and pay all staff a bonus to thank them for continuing to work through challenging times. While Laiwalla has beenan advocate for credit unions serving small businesses, he sees the national wave to go cashless as a potential disadvantage. If you want to serve retail businesses, you may want to rethink that strategy, he says.

Platinum FCU was formed to help support these types of cash-intensive businesses, but often receives requests from non-members and has difficulty finding other institutions to refer the business. There may be more scrutiny for Bank Secrecy Act(BSA) compliance, but we’re here for the members. We will continue to go above and beyond to serve their needs, Laiwalla says.

Laiwalla notes that many banks are getting out of these types of services and most credit unions were never in that space to begin with, leaving a big gap for retailers and a big opportunity for cooperatives.

There is still plenty of cash and there will continue to be as long as there are unbanked or underbanked consumers.

The post What We Can Learn From Successful PPP Lenders On How To Serve Small Businesses appeared first on CreditUnions.com.

The department released data in two formats. For loans exceeding $150,000, the department identified the borrower by name and other information but provided only ranges for the loan amount for example, $350,000 to $1 million. For loans less than $150,000, the department did not identify borrowers by name but did provide the specific loan amount.

Preliminary analysis by Callahan & Associates shows credit unions in all 50 states, the District of Columbia, and five territories originated 11,424 loans exceeding $150,000, accounting for 1.73% of all loans in this bucket. Because the specific dollar amount is not included for larger loans, the total balance for loans in this category is likely between $3.24 billion and $7.91 billion.

Credit unions played a larger role in lending to companies that requested less than $150,000, originating 179,085 loans for a total of $4.67 billion. This represents 3.29% of the dollars lent in this category but 4.23% of the borrowers, indicating credit unions originated a lower average amount than their banking peers.

According to data provided in the borrower application, these credit union loans saved 1,144,035 jobs. More than 13% of borrowers did not include employee numbers in their applications, so this number is likely much higher.

Mountain America Federal Credit Union ($9.3B, Sandy, UT) originated more than 7,000 loans, more than any other credit union. Of these, more than 6,560 were less than $150,000. Greater Nevada Credit Union ($1.1B, Carson City, NV) originated the most loans of all credit unions in the larger loan category almost 700 loans more than $150,000.

Check back for more analysis as Callahan dives into the data.

The post Credit Unions Help Save More Than 1.1 Million Jobs Through PPP appeared first on CreditUnions.com.

Joe Barbato, CEO, Millbury FCU

Millbury had lost online access due to inactivity. Calls and emails to the SBA went unanswered for a week. The local congressman, Rep. Jim McGovern, even intervened to get through to the overwhelmed SBA office in Washington.

Millbury finally received an email with a temporary PIN for the portal late Saturday night. But by the time the credit union saw the email, the PIN had already expired. Finally, after 10 agonizing days, the credit union gained access and began submittingapplications three days before the first round of $342 billion in PPP funding ran out on April 16.

It was a nightmare, says Joe Barbato, CEO of the credit union. When we finally got through to our regional SBA guy, he told us he had 6,000 emails he had to return that morning. They were just completely unprepared for this.

Since Congress passed the CARES Act on April 3, PPP has been steeped in controversy, from 200 publicly traded corporations receiving $100 million in loans to questions about why small community banks in rural states in the firstround managed to cover 81% of the state’s eligible payrolls more than double the number in hard-hit New York and California. Add to that a series of SBA loan portal crashes as thousands of lenders rushed to tap into the $310 billionin second-round funding available April 27.

Michael Dill, EVP and CLO, Royal Credit Union

Many feared PPP funding would run out again in less than a week; however, things are looking up for the popular PPP initiative. Dozens of high-profile companies such as Shake Shack and Ruth’s Chris Steakhouse gave back their loan money, and morethan $100 billion in PPP funds were still available as of last week. Further, the Treasury Department announced in early May that the majority of borrowers are no longer required to demonstrate need for loans less than $2 million. The SBA’stenth Interim Final Rule on May 15 finally addressed this question and others that had been nagging the program since the beginning.

We went into the program with no clarity and no guidance from the SBA, says Michael Dill, executive vice president and chief lending officer at Royal Credit Union($2.9B, Eau Claire, WI). It was like building an airplane while flying at Mach speed.

Within the first month, Royal closed approximately 1,000 loans more than all of the business loans it made in 2019. To date, the credit union has closed 1,143 loans totaling $49.2 million. The feedback has been very rewarding, Dillsays.

Lending Program Frustrations

At the outset, the first-come, first-served PPP process appeared to favor larger lenders. Bank of America, for example, announced May 4 that it had gained approvals on 265,500 loans totaling $24.9 billion.

Melva McKay-Bass, SVP Of Business Development, Suncoast Credit Union

According to Barbato at Millbury, the SBA sent a notice to lenders the day before the second round of funding was released telling them they could submit loan applications in batches of up to 15,000 to streamline the process. The next day, after the portalcrashed around lunch time, the SBA sent an urgent email advising lenders to limit the batches to 5,000 applications.

Millbury submitted approximately 100 loans for a total of $4 million.

Obviously, a credit union our size was not submitting batches of 15,000 loans, Barbato says. I don’t know for sure, but I suspect that’s what crashed the system.

To qualify for loan forgiveness, borrowers must spend 75% of the funding on payroll, while the remaining 25% can be spent on operating costs such as rent and utilities. However, many credit unions were frustrated by the lack of guidance on the loan requirementsand documentation needed for borrowers to demonstrate compliance and receive loan forgiveness.

We encountered many issues, says Melva McKay-Bass, senior vice president of business development at Suncoast Credit Union ($11.0B, Tampa, FL), which hasso far made more than 1,700 loans worth more than $47 million. The guidance was not clear. It seemed to change almost daily.

Todd Marksberry, President And CEO, Canvas Credit Union

Todd Marksberry, president and CEO of Canvas Credit Union ($2.8B, Lone Tree, CO), says a team of executives and legal counsel reviewed the 31-page preliminary guidelinesand had numerous questions for the SBA about how to advise borrowers on the risks. The credit union tried to reach the SBA during the first round but didn’t hear back until two days before the funding ran out.

Many of us in the industry were scratching our heads, Marksberry says. The major banks were making loans. How were they comfortable when they had the same guidance we had? Maybe their calls were being answered.

Even more frustrating, Canvas also couldn’t access to the SBA portal and finally received a new password on the Wednesday the first round ran out. The credit union immediately submitted applications, only to learn from the SBA that they were lostand would have to resubmit them. By that time, the money had run out.

It made you want to laugh or cry, Marksberry says.

The Canvas team was ready for the second round and managed to get 590 PPP loans approved for $15.8 million. The loans cover more than 1,980 employees at Colorado businesses.

Smaller Player Support

Kate Laud, CEO of Opportunities Credit Union ($43.3M, Winooski, VT), says the distribution of the loan funds is troubling. For example, Bloomberg reported that only 38% of PPP loans in the first round were approved in California, whereas 81% of the loans were approved in Nebraska. According to the report, Republican-led states in the Midwest appeared to fare betterthan Democrat-led states on the coasts.

Kate Laud, CEO, Opportunities Credit Union

We were really surprised that Vermont got 67%, Laud says. It’s almost as if they said let’s pick the smallest Blue State and give them a little extra. As far as population per state, I think we’re doing pretty wellfor the allocation we have.

Although the PPP loan process wasn’t perfect, she adds, the program itself is making a major impact. So far, the credit union has gotten 38 loans approved for $2.1 million.

People can be critical that this piece was missed, this piece was late, or not everybody got in the door in time, but it’s incredible that they got it out, Laud says. A really small player like our credit union was able to make27 of our business borrowers extremely happy and all within 10 days.

One of those small businesses, Vermont Comedy Club of Burlington, VT, closed on March 13 and had to lay off all 26 full-time and part-time employees. Natalie Miller, who runs the businesswith her husband Nathan, switched to online shows and classes paid for by donations to keep people laughing during these hard times. The PPP loan enabled the couple to rehire four employees to help plan new programs to generate revenue.

We are so incredibly lucky to work with a credit union because we have formed great relationships with the staff and get more personalized attention than we might at a bank, Miller says.

After the portal crashes in the first week of round two, the SBA changed its processes, giving smaller loans priority for approval. By May, the agency said it had made 2.2 million loans totaling more than $175 billion. The average loan amount of $79,000shows the program is assisting the smallest of small businesses.

Over 850,000 loans about one-third of the 2.2 million loans were made by lenders with $10 billion of assets or less, Steve Mnuchin, secretary of the Treasury, said in a statement.

Jumping Into The Game

Mike Poirier, vice president of consumer and commercial loans at Patelco Credit Union ($7.5B, Pleasanton, CA), says the credit union did not participate in round one ofPPP because its focus is on supporting individual members rather than businesses.

Mike Poirier, VP Of Consumer And Commercial Loans, Patelco Credit Union

However, we heard from our members that many who have businesses were unable to access the PPP loans in the first round, Poirier says. For this reason, Patelco decided to participate in the second round, focusing on our existing memberswith businesses that constituted 25 employees or less.

Patelco applied to become a certified SBA lender and received approval in less than a week. It also worked with a credit union service organization to set up appropriate procedures.

We began contacting members that had shown interest, Poirier says. We submitted our first applications on April 27 and received notification from SBA of approval the same day. We have had same-day responses on all of our applications.Our average loan amount is less than $15,000 due to our focus on smaller businesses. Overall, the process has gone relatively smoothly.

Patelco has so far provided 44 PPP loans totaling more than $551,000, although the credit union has offered $5 million in relief loans at below-market interest rates since the shelter-in-place orders began in California, in addition to providing loandeferments on mortgages and personal loans for more than 12,000 members.

Creating Heroes

Having the SBA certification and an active program was a major benefit for Telhio Credit Union ($868.0M, Columbus, OH), which has been in the program since 2013. As a creditunion with less than $1 billion in assets, Telhio was able to be nimbler than many larger institutions and scale up resources quickly, says Derrick Bailey, chief sales officer at the cooperative.

Derrick Bailey, Chief Sales Officer, Telhio Credit Union

If we had a little more guidance sooner, we could have scaled up quicker and helped even more businesses, Bailey says. Yes, we’re frustrated, but you have to look at this on both sides. The SBA had to put together a new programin 10 days to lend out more than $340 billion.

Alissa Head, executive director of Global Gifts, a 32-year-old Indianapolis-based nonprofit that sells fair-trade handcrafted goods made by artisans around the world, says she first approachedlocal banks for PPP loan assistance but never heard back. Telhio responded within a day and became our heroes, Head says.

As a result of the loan, she was able to keep 32 people employed and working from home on updating the organization’s website, inventory, database, and social media.

It was a true leap of faith for me, Head says. We wanted to put the safety and wellbeing of our staff first, and this forgivable loan program makes the difference between being able to reopen or not. It supports not only our staffbut also a lot of artisans globally who lost their source of income.

The post Credit Unions Overcome PPP ‘Nightmare’ appeared first on CreditUnions.com.

Here, six accomplished credit union data analysts share what’s happening inside their shops.

Affinity Plus Federal Credit Union

Stephen Geyen has been vice president of business intelligence for the past five years at Affinity Plus Federal Credit Union($2.4B, St. Paul, MN).

With COVID-19 turning the economy on its head, credit unions are well advised to identify and support struggling borrowers sooner rather than later. For the past couple of years, the analytics team at WSECU has helped the credit union determine which borrowers are at risk of defaulting and who might just need a push to pay. Borrower data also helps the cooperative determine how to reach out and via what channel.

It costs approximately $1 a minute for the average call center to serve a caller. That’s according to callback solutions provider VHT. As such, reducing callvolume by shifting calls to automated phone systems, online banking, and mobile apps can translate into big savings.

For credit unions, outbound calling is an important channel for borrower communication, debt collection, and charge-off reduction. However, how can a credit union determine which borrowers to call? How soon and how often should the credit union call?And, which slow payers are at risk of becoming delinquent borrowers?

Analytics and member data are helping to answer those questions at Washington State Employees Credit Union ($3.0B, Olympia, WA), which has doubled in size in the past decade and today has branches stretching from Seattle to Spokane.

WSECU is employing analytics and machine learning to make smarter, more efficient use of member solutions department resources, reducing costs related to its third-party collections partner and improving collections results across its loan portfolio in the process.

Bill Peterson, vice president of analytics and insights at WSECU, says his team has gained numerous insights for predicting borrower behavior and prioritizing collection attempts. But to get here, the credit union had to take several swipes at analyzing data and fine-tune its methodology.

Initially, the team at WSECU looked at whether a pre-built collection score from a credit bureau was useful in predicting a loan charge-off. Early on, the team discovered the collection score wasn’t a meaningfully better predictor than the member’s last reported FICO score, which the credit union already collects for risk purposes.

So, the credit union combined the FICO score with other member data and created its own custom collection scoring system.

We used machine learning algorithms to generate the scores and found they worked really well across a range of products, says Peterson. While the overall methodology employed is proprietary, I can share that it includes dimensions that weigh the strength of the member’s relationship with WSECU, as it includes an understanding of the member’s previous history of default. This gives us the ability to better identify members who will self-cure’ [repay]based on less-expensive contact methods.

Armed with the custom collection score, WESCU can identify members who need fewer contacts or who are just as likely to respond with automated phone reminders. That’s helped WSECU significantly reduce call volume handled by its collections vendor and has saved the credit union nearly $8,000 per month.

We’re also improving member experience by using contact methods that are less intrusive than a live person calling, Peterson says. This more impersonal touch by automated phone messaging can serve as a nudge with results that are just as successful.

On the flipside, WSECU also can identify members it needs to contact earlier because they have a higher risk of default.

We have more meaningful conversations with the people who need our support sooner in the process, the VP says.

No Credit Check Necessary

WSECU’s analytics department is a central support group and aids in the success of QCash and QCash Plus, an instant loan program with a low fee and no credit check. QCash grants loans between $50 and $700, while QCash Plus grants loans of $700 to $3,000. WSECU uses a statistical modeling approach and internal scoring to underwrite the loans.

The model has been in production for a little over a year and we’ve seen great results in charge-off reductions, says Bill Peterson, vice president of analytics and insights at WSECU.

And what about mailed notices and physical communications? Peterson says the organization as a whole is looking for ways to communicate with members in the channels they prefer.

That work is more complicated and would likely be less impactful than our initial gains, Peterson says. But, it’s the next obvious step in extending the models into different areas of the credit union.

WSECU’s analytics department is a central support group for the Evergreen State cooperative. As such, the department also is using analytics to improve results for other parts for the credit union such as marketing and risk.

One area we hope to get more traction in is product recommendations, Peterson says. This area lends itself to the type of automation that data science works best with, and we think it will be a useful growth tool.

WSECU has been working on the product recommendations it makes through its new online banking platform. However, the biggest technology challenge there lies in how to automate the delivery of the recommendations rather than what model or analysis to deploy.

Going forward, we feel like this is going to be a major use of data science within the organization as it lends itself well to automation and machine learning, Peterson predicts. There are a lot of promising opportunities for using analytics.

How are you using analytics to serve members during this crisis?

Stephen Geyen: We began to see a significant drop off in member activity on March 16. Within two weeks we created approximately 25 PowerBI visuals that showed the changing member activity on a day-to-day basis. The changes were breathtaking,and seeing them allowed us to quickly ask critical questions about how we should reallocate resources and support our members.

At the employee level, their roles changed when we closed lobbies on March 17. The branch employees who were not working the drive-thru began working remotely, taking member calls, making outbound calls to members, supporting off-the-charts mortgage activity, and helping with inquires to our credit work-out team.

At the member level, we began analyzing changes in activity to identify those who could benefit from immediately working with us versus waiting until they had to throw in the towel.

What are you looking for in the data, and what do you do when you see it?

SG: We began tracking unemployment deposits, skip-a-pay, forbearance requests, loans past due, and changes in revolving debt, and we developed models to identify changes in member income and spending. We use these data points to identify members who are feeling financial stress and provide lists to the outbound call teams so they can reach out with an offer of support. We’ve also used these lists to create offers of support via email and digital banking pop-ups.

What results have you seen so far?

SG: We’ve seen significant spikes in use of forbearance, consumer loan skip-a-pay, members calling in for financial support, and clicks on our educational content that we specifically designed for COVID-related issues. Furthermore, member feedback has been positive, and results suggest our NPS score could increase due to the efforts we’re making to proactively work and communicate with our members.

What have you learned about using analytics in this way, either as a best practice or a lesson learned?

SG: The PowerBI visuals span nearly every member channel, product, and service from fee activity to RDC use, loan apps to closing, phone use to card use. That has allowed us to dive deeper based on other factors such as location, channel, platform, and FICO scores.

Amplify Credit Union

Matthew Monagle joined Amplify Credit Union($994.5M, Austin, TX) as marketing communications manager in March 2019.

How are you using analytics to serve members during this crisis?

Matthew Monagle: When shelter-in-place orders started going into effect around the state of Texas, our loan servicing and account resolutions teams went to work implementing a new deferment program. If our members’ income has beenimpacted by the COVID-19 pandemic, we will help them set up a series of scheduled deferments for personal, business, or real estate loans.

With so many people in our community struggling, this has been an opportunity for us to practice what we preach as a credit union. The challenge, though, has been making our members aware of this option before their loans become delinquent.

What are you looking for in the data, and what do you do when you see it?

MM: The Amplify marketing team crafted an automated email that goes to all members near the end of their late payment grace period. Using payment data, we identify which members are at risk of going into a delinquent status and proactively offer them a payment solution. This report also helps highlight at-risk members for our team to follow-up with directly.

What results have you seen so far?

MM: As of the middle of April, we’ve delayed 2,010 months of payments on 1,042 loans for balances totaling approximately $34 million. Just as important, however, is the number of members who are experiencing a hardship who have reached out to discuss loan payment options. Education is a key component of what we do at Amplify, and it’s been gratifying to see members recognize that they do have options during this difficult time.

What have you learned about using analytics in this way, either as a best practice or a lesson learned?

MM: Identify problems before they become problems. We’ve all seen cases where a negative situation might’ve been avoided if a member had an opportunity to make changes to their account. Informing our members of their deferment opportunities before their loans go delinquent protects our finances as well as theirs.

Centra Credit Union

Carrie Jenkins has been assistant vice president of business analytics at Centra Credit Union($1.6B, Columbus, IN) for the past three years.

How are you using analytics to serve members during this crisis?

Carrie Jenkins: My team and I have been providing our decision-makers and front-line staff with real-time information to help them keep a thumb on the pulse of the credit union. The analytics we’ve provided have helped develop relief programs and provided insight into the communications members need so we can proactively educate them about these programs.

We have call logs and call reason trending for our contact center, transaction volumes, daily cash withdrawal trends, lending production and pipeline reports, VPN connection volume reports, and information on accounts that are delinquent but do not have a history of delinquency.

What are you looking for in the data, and what do you do when you see it?

CJ: I haven’t been monitoring much of this myself; however, my team and I always look for opportunities to help decision-makers implement new programs or changes to meet members’ needs, improve the member experience, and promote business continuity.

What results have you seen so far?

CJ: I’ve received positive feedback about the information my team provides. Knowledge really is power. No one is operating on a hunch or a guess.

What have you learned about using analytics in this way, either as a best practice or a lesson learned?

CJ: Just because the information is presented in a chart does not mean it’s easy to understand. At times, it seems like people are looking at a Rorschach test and not a bar chart. Everyone has their own opinion about what the chart really means. This type of summarized information needs a clear explanation of the source, the results, and the key takeaway. I find myself explaining things like why a decrease in the rate of increase is not just a decrease. As storytellers, we have the responsibility to make sure what we say cannot be misconstrued.

Teachers Credit Union

Mike Benassi has been with Teachers Credit Union ($3.3B, South Bend, IN) for 17 years and in his current role for the past two-and-a-half years.

How are you using analytics to serve members during this crisis?

Mike Benassi: We look at eight weeks of members’ direct deposit history in two-week buckets to spot deviations outside the norm. If a member normally gets $3,000 every two weeks in direct deposits but now is getting only $1,000,that’s a significant reduction in income.

What are you looking for in the data, and what do you do when you see it?

MB: We flag outliers and call and ask, Hey, how are things going? and let them know TCU is here to offer assistance. We tell them about loan deferrals and about our skip-a-payment program. It’s a wellness check tohelp support the health and safety of our members in these trying times.

What results have you seen so far?

MB: Our CEO sends daily emails about what he’s hearing from members, and he says a lot of them are grateful to hear from us. TCU members like knowing we have their financial needs in mind and that we’re here to help. We also are building dashboards that show some interesting results. For example, skip-a-payment use greatly exceeded our original expectations. In fact, we did more of these transactions from March 15 to April 15, than we did in all of 2018.

What have you learned about using analytics in this way, either as a best practice or a lesson learned?

MB: You can do some pretty easy calculations to really help people in these trying times. It’s not rocket science. We used simple stats from looking at direct deposits, just means and standard deviations, to quickly come up witha good list. You can spend a lot on expensive software and powerful modeling tools, but there are also things you can do inexpensively and easily that can immediately make a real impact.

Wings Financial Credit Union

Mike Lindberg has been with Wings Financial Credit Union($5.6B, Apple Valley, MN) for the past six years and leading the data solutions team for the past three-and-a-half years.

How are you using analytics to serve members during this crisis?

Mike Lindberg: The COVID-19 pandemic and subsequent response is unprecedented in the level of impact to society at least in the lifetime of most reading these words. Unprecedented events tend to instill anxieties and fear into the people facing them. The single most valuable thing Wings is using analytics for is to provide foundational clarity in the details, thus calming some of the emotions we feel.

We’re using data to support a greater understanding of where our members are currently affected. We’re also using data to provide insight and forecasts/predictions into what the next six to 12 months might look like.

Knowing we don’t have much data to base our forecasts and predictions on, we’re working diligently with the business to ensure we capture more data than ever to be able to provide useful information to help them drive their strategy in servingour members most effectively.

What are you looking for in the data, and what do you do when you see it?

ML: We’re helping identify members who might be suffering financial hardship. We’re also helping to understand branch traffic, how we can balance employee health and member service, and how much cash we need to keep on hand.

We’ve seen that stay-at-home orders reduce overall spending, so what is the impact of that? The longer stay-at-home orders remain in effect, the more likely our members’ channel preferences will be affected, so how do we best support the continued build-out of our digital channels?

What results have you seen so far?

ML: We’ve seen the business lean-in to data solutions and leverage analytics to answer ad-hoc questions and enhance business processes that further our ability to make things easier for members.

As an organization, we’ve seen employees and leaders come together to serve our membership in amazing ways. We’ve seen the organization take on complex efforts to truly leverage data in the service of members. Most importantly, we’ve seen and are experiencing the credit union difference the ability to unabashedly serve our members during this difficult time.

What have you learned about using analytics in this way, either as a best practice or a lesson learned?

ML: Difficult times might be the best time to ask co-workers, members, friends, family, and those we encounter, How can I serve you? This is an isolating time, and we have the opportunity to feel connected. It’s in these isolated, difficult times that we remember lessons best.

As a person, I want those around me to receive the lesson that I care. As a co-worker and as a data solutions team, I want the business and membership to know we are here to lift them up. As a credit union movement, I want our members to know, without any doubt, that we are here to serve them.

Workers Credit Union

Cassandra Stoddard has been with Workers Credit Union ($1.9B, Fitchburg, MA) since October 2013 and in her current role for four years.

How are you using analytics to serve members during this crisis?

Cassandra Stoddard: The fastest, most effective way to gain a directionally accurate picture of how our membership is being affected in this time of crisis is to look at our transactions. As luck would have it, my team had just finisheda complete overhaul of our transaction data, which includes a bi-monthly check and balance from our warehouse back to core. Data integrity is the pillar of success in driving a data-driven culture, crisis or no crisis.

There have been a handful of existing processes that, working with our member experience team, we have chosen to relax or enhance. That includes identifying members with paper statements and urging them to convert to e-statements as mass mailings can be delayed, identifying members who will fall out of the level needed for higher interest on their checking accounts, designing a new set of user fields that my team can access and report on, and identifying the members who have been granted several deferred loan payments.

We’re also involved with helping to respond to additional regulatory reporting and reforecasting our budget because of pandemic-related changes in cash flow, loan mixes, and more.

What are you looking for in the data, and what do you do when you see it?

CS: Our enterprise analytics team answers questions and delivers analytics that positively impact the financial wellness of our credit union and our members. This is where the rubber meets the road.

As the situation unfolds, we look for guidance from our management teams, making sure the EA team is there to support those that have committed to using data to help solve problems. We look for opportunities to listen to them and help them adjust to fit today’s circumstances, building on their existing relationship with familiar data.

It’s common for organizations with even the most advanced analytic capabilities to fight the ever-lasting power of gut-feeling decision-making, but when past experience fails you, data doesn’t.

What results have you seen so far?

CS: We have very few metrics so far. We can track transactions and document contact center activity, but we’re still in prevention mode.

The organization is confident the EA team can use data to help our peers respond to changes with agility and accuracy. We’ve had productive meetings where managers are collaborating and coming up with a range of scenarios in which we could find ourselves, helping to keep the credit union more stable.

4 Critical Areas Of Analysis

The analytics team at Workers Credit Union has looked at transactions to develop a fast, accurate picture of the COVID-19 pandemic’s effect on the Massachusetts credit union’s 104,210 members.

Cassandra Stoddard, assistant vice president of enterprise analytics, details four areas in which her team has delivered crucial data during the past few weeks:

• Trend Analysis: How are members using the credit union today versus in the past?
• Channel Analysis: How are members communicating with the credit union? How can Workers best use the staff it has to accommodate channels most frequently used by members?
• Shared Branching: Does Workers have members who typically transact with other organizations for convenience? Are these members aware of what the credit union has in place to support their financial needs while respecting social distancing?
• Transaction Fluctuations: Are ACH and external deposits dropping? Has a member stopped making loan payments? Which members are receiving unemployment deposits?

We’ve also noticed urgent data requests are slowing down, which means we’ve done an adequate job of providing a variety of analytics around our most pressing areas of concern.

What have you learned about using analytics in this way, either as a best practice or a lesson learned?

CS: The EA team has focused for years on being able to answer 80% of our questions with 20% of our data. We have built a data environment that houses the main pieces of our core, which some find to be overly defensive in terms of strategy but has resulted in an incredibly high confidence level in the data we have needed to get us through this crisis day by day.

My decision to be conservative has positioned our credit union to deal with emergencies. Our foundation is rock solid. Not to say I don’t look back and consider the benefits of being more innovative in nature and where that would have put us in all of this, but I feel good that we can build upon what we have.

Interviews have been edited and condensed.

The post Analytics Offer A Smarter Approach To Collections And Underwriting appeared first on CreditUnions.com.

Derrick Bailey, Chief Sales Officer, Telhio Credit Union

With 90% of Americans under stay-at-home orders, local economies shifted almost overnight, leaving an estimated 7.5 million small businesses at risk of permanently closing their doors. Meanwhile, demand has skyrocketed for services such as groceries and business lending.

At most credit unions, branch transactions have fallen dramatically and lending teams are in high demand. Telhio Credit Union ($844.0M, Columbus, OH) ramped up lendingsupport to take advantage of the federal Paycheck Protection Program (PPP) loan program, which launched April 3 to help small businesses pay their employees during the COVID-19 crisis. Meanwhile, demand for new mortgages, refinancings, and home equityloans has grown as interest rates hit a 50-year low.

The life of a loan specialist these days is hectic, with many employees putting in long hours, sometimes filled with uncertainty. But in many ways, the work is more rewarding than ever, says Derrick Bailey, chief sales officer at Telhio.

It’s been a challenging but good experience in light of a bad situation, says Bailey, who started his career as a wholesale mortgage account executive after graduating from the University of Toledo in 2005 and currently leads commerciallending, residential mortgage, and business development at Telhio.

In the wake of the Ohio governor’s stay-at-home order on March 24, Bailey and his team immediately shifted to remote working. Anticipating the increased loan demand, he had already begun shifting employees and new hires to support critical areas.Bailey, who joined the credit union in 2013, says it didn’t take long to settle in to a new normal routine.

Dressed For Success On The Web

Each day, Bailey has three standing WebEx status meetings with each of his teams. Plus, he makes an estimated 200 phone calls. These days, he says he prefers WebEx video because it helps resolve issues faster. Luckily, Telhio’s lending team wasexperimenting with remote working before the lockdown, and employees have laptops and experience with WebEx.

Everybody our executive team, our CEO, our board understands the urgency and gives us their full support.

Bailey is up by 6 a.m. and dressed in slacks, a dress shirt, and sports coat by 7 a.m. to start his day of WebEx meetings and phone calls. His wife, Denise, a financial crimes analyst specializing in anti-money laundering, works down the hall from hishome office.

Once I cross that doorway, I’m at work, Bailey says.

Lately, he’s been putting in 12-hour days or longer and checking back in with his team before calling it a night. He says most of his team is working 60-hour weeks, Monday through Saturday, at all hours of the day.

It makes me proud to see everybody in the company stepping up cross-department, cross-division, and cross-functional, Bailey says. People working on the weekends, working 15-hour days. It’s a way we can help our smallbusinesses and all of the nonprofits we support.

Water Cooler Conversions

Although there is increased demand in some parts of the business, such as business and mortgage lending, work in other areas, such as auto lending, has fallen off. Bailey has been urging employees with time on their hands to work on training and certifications,which are not only a professional benefit but also a good way to fill a long day.

According to Bailey, he dedicates time in many of his meetings these days to water cooler conversation about how people are coping with the lockdown.

A lot of us are getting caught up on yard work and home projects, he says.

During these conversations, the virtual manager also takes the opportunity to check in on everyone’s mental state.

I advise everyone to call your team, not just your managers, Bailey says. Schedule a conference call and rally the troops. Try to have a little fun, try to lighten the mood until we can get back socially to the same place.

After a morning of meetings and calls, Bailey’s heads to his office in downtown Columbus. The credit union recently opened a 12,000-square-foot operations center, which gives employees ample room to practice social distancing. Bailey visits hisoffice two or three times a week these days.

From the parking lot, it’s just two doors to get to my office, he says. Once, I close the door, it makes it easier to practice social distancing.

As an added bonus, the credit union buys lunch for commercial lending team members who come into the office every day. They favor the restaurants of local business members and buy hand sanitizer from a local distillery that converted its operations duringthe pandemic. CEO Leslie Bumgarner also recently sent goodie bags to the entire team.

$27M In 2 Weeks

Bailey’s team is under pressure to process as many PPP loans as possible to help local businesses keep employees on their payrolls. As long as 75% of a PPP loan goes toward eight weeks of payroll, the Small Business Administration (SBA) will forgive100% of the loan.

The $349 million PPP fund ran out of money in just 14 days. However, within that time, Telhio was able to obtain authorization on 215 loans for $27 million. Approximately 25% of the borrowers were new to the credit union. Bailey says he has 92 applicationsthat didn’t get funded waiting in the wings for the additional $310 billion $60 billion of which is earmarked for smaller lending institutions such as credit unions that Congress approved to refill the PPP fund.

We’re still working on getting everything funded, Bailey says. The speed and the pace with the SBA regulations has been a challenge, but the team’s in good spirits. We’ve got a good process in place.

See which credit unions have had historical success in SBA lending and how their portfolio compares to your credit unions in Peer-to-Peer. Learn more.

Telhio has been providing SBA loans since 2009 and, funded over 8.1M in 2019, and is the eighth-largest SBA lender in the Columbus-Cincinnati area. Even before the PPP program emerged, however, Telhio had added back-office and relationship specialiststo support the projected growth in demand for the loan type.

Telhio hopes to expand business with new members coming in though PPP loans. But with auto loans down, Bailey expects overall loan growth will probably be a wash by the end of the quarter.

Bailey also says, in the long run, he expects the crisis will help lenders become more agile and willing to try new things, especially as the SBA has looked for ways to streamline loan processes throughout the PPP rollout.

This is forcing lenders to think about how to deliver, how to onboard, and how to handle the member experience, he says. For example, hats off to the SBA for allowing e-sign for the forms. Wet signatures would have been catastrophic.

Life Doesn’t Stop Even For COVID-19

On a recent Friday afternoon, Bailey took the day off to close on his new house. The closing took longer than expected because he and the other parties met in the parking lot and stayed in their cars as they signed documents with the legally requiredwet signatures. Bailey admits it’s an unusual time to buy a home, but the right elements fell into place.

We were going to hold off, but this was the house we’ve been looking for, so we went for it, he says. Plus, the rates are really, really low, and there’s not a lot of inventory in the Columbus market.

Bailey’s Friday ended back in his home office around 7:30 p.m., after a 40-minute interview for CreditUnions.com. During the phone call, he shared examples of how Telhio’s work is paying off. One local manufacturer received one of the firstCOVID-19-related loans to help shift production to making badly needed parts for ICU respirators.

The tough part for everyone is uncertainty, but I’ve noticed how quickly our members in the business community have acted, Bailey says. They’re getting the information to us when we need it. They’re acting with asense of urgency.

In addition to adding a sense of urgency to every day operations, the pandemic has also served to reinforce for Telhio how engrained it is in its community and how integral it is in the lives of its 58,000 members.

If we’re not able to help these small businesses make their payroll, then their employees our members are not going to be able to make their mortgage or their personal loans, Bailey says. They’re not goingto be able to put food on the table. Everybody our executive team, our CEO, our board understands the urgency and gives us their full support.

The post The New Normal: A Hectic Day In The Life Of A Business Lender appeared first on CreditUnions.com.