Filed under: Current Issues in Credit Unions, humor | Tags: credit unions, humor, shari storm
Shari Storm helps Faith, Guy, Katherine & Rob finish out the year. We discuss Shari’s 23 Credit Union Truths and have a lot of fun. We hope you enjoy it as much as we did. Happy New Year!
The CIiCU hosts are:
Brian Witt
Hal Scoggins
Farleigh Wada Witt,
Attorneys at Law
121 SW Morrison Street, Suite 600
Portland, Oregon 97204
Telephone: 503-228-6044 Fax: 503-228-1741
http://www.fwwlaw.com
Guy Messick
Katherine Weber
Messick & Weber P.C.
211 North Olive Street
Media, PA 19063
Telephone 610-891-9000 Fax 610-891-9008
http://www.cusolaw.com
Faith Anderson
American Airlines Credit Union
P.O. Box 619001
MD 2100
DFW Airport, TX
75261-9001
(800) 533-0035
https://www.aacreditunion.org/default.asp
Robert Rutkowski
Shareholder
Weltman, Weinberg & Reis Co., L.P.A.
323 W. Lakeside Avenue, Suite 200
Cleveland, Ohio 44113
Telephone: 216-739-5004 Fax: 216-739-5642
http://www.thatcreditunionblog.com
http://www.weltman.com
Subcribe to the show via iTunes Music Store:http://phobos.apple.com/WebObjects/MZStore.woa/wa/viewPodcast?id=151785964&s=143441
Filed under: credit unions, opinion | Tags: credit unions, International credit union day, opinion
By: Rob
Back in 1986, I got my first credit card from Lake County Educational Credit Union. I used it throughout college and when I needed car loans, while I was in school, the credit union was there. Eventually, around 1994, I ran for the board of directors, was elected and served until 1998 when I joined WWR. That move catapulted me into the best job of my life: getting to serve credit unions as their attorney. Credit union people, like the industry they serve are down to earth and some of the nicest people you’ll ever meet. Hokey? Yes, but as a volunteer and then as counsel, I am privileged to be involved with the movement.
Last year, dire predictions were in the air. Credit unions may decline in number by 50% and so on. Now, amazingly, and through the most unlikely series of events, people are flocking to credit unions again. Who would have thought that as a side effect of the Durbin Amendment to the Dodd-Frank Act that some banks would raise debit card fees and that this would cause consumers to vote with their feet and join credit unions. I certainly would not have guessed that in a million years. And yet, here we are.
But grass roots efforts are about as crunchy credit union as you can get. Remember 1151? Pro credit union folks marched on Washington and change happened. Today’s challenges are a whole lot more amorphous, but at the end of the day, the message of people helping people hits a chord. When I speak before credit union audiences, I always try to be positive and the message lately has been that credit unions grew dramatically around the time of the Depression. It’s kind of sad when a reference to the Depression is supposed to be upbeat!
But it’s not hard to connect the idea that not-for-profit cooperatives that pool member money for member loans while giving a voice to members is appealing. It’s not much of a leap to see the appeal of a financial institution where member service is not only important, but it’s in the DNA of the organization.
What do I owe the credit union movement? Nothing short of everything I have. Maybe credit unions don’t always have the latest bells and whistles that multinational conglomerates can muster, but you can always look at a credit union balance sheet and understand what’s going on. Moreover, even with the largest credit unions you can understand who they serve, where they came from and what their priorities are. Member service is always there because, by definition, it’s the member’s money and it’s the member’s credit union. This year, for the first time in a few years, credit unions really do have something to look forward to: rediscovery by the people they were made to serve.
Filed under: Consumer Financial Protection Bureau | Tags: assets, banks, CFPB, credit unions, Dodd-Frank, run
By: Rob
This whole idea is picking up steam along with the Occupiers. The concept is that on November 5th, consumers can vote with their feet and express dissatisfaction with banks by moving their money to a credit union. To people stung by new fees, one would think such a proposal would have the chance to go viral. I don’t think it will because people really need to be mad to generate enough will power to overcome the inertia of changing their bank accounts. Ironically, the new fees are the result of The Dodd-Frank Act and the creation of the CFPB which was initially supposed to reform Wall Street but now sees itself as providing consumer protection. People are mad, but they aren’t that mad.
Let’s assume for the sake of argument that a good percentage of the population actually did get that mad and moved their money in one day. What would happen? It’s actually easy to predict: utter chaos. It turns out that having too much by way of assets is not a good thing for a credit union. The influx of cash to the credit union movement would immediately plunge the receiving credit unions into a state of ill-health.
Meantime, on the bank side, we have historical evidence of what happens when everyone takes their money out of the banks at once. It’s called a run. During the depression, many banks went out of business for that reason. The exposure would be so great that the Federal Reserve would act, most likely, to close down consumers’ access to banks and credit unions until the dust settled. You think people are mad now? Imagine hundreds of millions of people not being allowed access to their bank accounts for a week!
Now if such a shift occurred gradually, over time credit unions could manage the capital and banks would not have the immediate pain of a run. Certainly, many credit union advocates have sought this over the years. Timing is everything though and so is being careful what you wish for.
Edit: According to CU Times, the Bank Transfer person is not affiliated with the Occupiers.
Filed under: brainstorming, credit unions, products, Uncategorized | Tags: credit unions, Poke the Box, Seth Godin
By: Rob
On the cover of Seth Godin’s latest book “Poke the Box: When Was the Last Time You Did Something For the First Time?” is a drawing of a man who looks remarkably like the person featured in traditional credit union ads holding an umbrella or otherwise representing the common man. The parallels with issues facing the movement don’t stop at the cover of this wonderful little book. Godin, an author, public speaker and all around entrepreneur is always worth reading. In his new book, Godin’s message is choose yourself. That is, if you have an idea, if you have a dream, pursue it yourself don’t wait for someone to pick you or hire you to do something else. As he says in the book “Go. Do that.” It is interesting to me because he spends half the book telling you to jump in and then he peppers this position by telling you how to apply a filter to some of your ideas so that you don’t do something particularly stupid. That being said, he also warns not to be afraid of failure, which is always good advice. Godin himself has failed at a number of different projects; however, one of his successful ventures netted him 30 million dollars back in 1998. Godin is a restless producer of thought and ideas and an extraordinarily successful person in his own right.
But this is not a book review. My goal in this blog post is to identify why you should, dear credit union reader, spend some time with Mr. Godin and read his new book. It has been my experience, and I know this might be an incredible shock to you, but something I hear in the Credit Union Movement frequently is “We’ve always done it that way.” I would submit to you that credit unions who continue to pursue that philosophy will not exist by 2016. In fact, some people believe that half the credit unions today will not exist by 2016. To me that would be an epic tragedy. As Godin says “The world is changing too fast. Without the spark of initiative, you have no choice but to simply react to the world. Without the ability to instigate and experiment, you are stuck, adrift, waiting to be shoved.” Today, being shoved means being shoved out of the movement.
Godin also identifies what is needed to make something happen. “An idea, people to work on it, a place to build or organize it, raw materials, distribution, money, marketing.” Credit unions have all of these things in spades. Ideas are floating around more plentifully than ever online, in think tanks and among your peers and employees. Credit unions have employees that can work on these ideas, buildings, money, members to distribute ideas too marketing people and of course the raw materials of computers and papers and the other implements of financial services. Godin mixes the ideas of success and failure along with persistence as being essential to continued existence. This identifies what is happening in the Credit Union Movement right now so perfectly that it hurts. Really, credit unions have nothing to lose by way of failure at this point because if a credit union does nothing, it will probably fail anyway. If a credit union puts three boats in the water and only one of them comes in, it will probably succeed.
Godin even puts this into a formula: “When the cost of poking the box (PTB) is less than the cost of doing nothing (0), then you should poke! [PTB-0=poke]” Again, the cost of doing nothing at this point is merger or liquidation. At the same time he says “If you run a giant, billion dollar steel mill, I don’t think you should shut it down for a month to try new, untested technology.” It is a balancing act but the message is to go forward.
The best thing, perhaps, about Godin’s new book is that it is very short. Plus at $8.00 it is pretty cheap. If you work at a credit union, read Poke the Box and share it with your coworkers.
Filed under: Uncategorized | Tags: app, credit unions, piggymojo, savings, shari storm
Today’s blog comes courtesy of Shari Storm, Senior Vice President and Chief Marketing Officer of Verity Federal Credit Union. Shari is the author of the new book ‘Motherhood is the New MBA”, available here.
I’ve joked for a long time about my husband and my different spending habits.
When Jim Bruene, at Net.Banker wrote about PiggyMojo , a spending tracking platform for couples, I was instantly interested.
So I signed up. The way the program works is when one person is faced with the opportunity to spend money and resists, they text it to PiggyMojo and it tracks all those small decisions and adds them up for you. For example, if a co-worker is on their way to Starbucks and asks me if I want my usual, and I say no, I text “4 coffee” (meaning I just saved $4 on coffee) to PiggyMojo.
You tell the program what you are saving for and it tracks your actions against your goal. I said we were saving for a better TV (our current TV actually has to “warm up” circa 1978 before the snow goes away and the picture comes in). I said I wanted the TV by my husband’s birthday in October. PiggyMojo calculated that we’d have to save $65 per week to make that happen.
And so once a week I got a reminder email that I needed to save $65. To be honest, my interest in the program started to wane after getting three weeks worth of emails reminding me that I needed to save $65 per week in order to get a new TV by October.
Then one day, my husband set me an email that said, “I just fixed the weedwacker myself. Send me positive reinforcement for saving us $50!” (If you knew how opposite-of-handy my husband is, you’d be very impressed with this email).
I texted PiggyMojo “50 weedwacker”. I suddenly realized how absolutely right Jim was in his post. If my text had actually made a transfer from my checking account to a hard to touch savings account, this would be brilliant. My husband and I would have the instant gratification of knowing that we were $50 closer to a modern TV.
The thing with savings, the founder, Jayson Halladay, told me when I met him in New York a few months ago, is there is no instant gratification. That is what PiggyMojo is trying to instill – that sense of immediate satisfaction when a buck is saved.
Jason and PiggyMojo are looking for a financial institution to partner with – ideally a credit union – to create a mobile app that actually transfers real money when a savings success happens.
I think this would be a great project for an i3 group or some other innovative CUSO or credit union. I’d buy it from you.
Today’s guest blog is an article entitled ‘Our Myths Hold Us Back’, which was recently featured in the CU Times, reprinted with permission from the author Guy A. Messick. Guy is an attorney with Messick & Weber PC in Media, PA and General Counsel to NACUSO. He can be reached at 610-891-9000 or gmessick@cusolaw.com.
The stories we tell ourselves frame how we view the world, our place in it and how we respond to it. I call this internal viewpoint our myths, our prisms that interpret the world. The myths we create for ourselves have a profound impact on our ability to recognize and respond to change. The prism through which we see the world is formed for each of us, not surprisingly, during our formative years. For example, the children of the depression in the 30’s were adults in the boom years of the 50’s but they never took prosperity for granted and made decisions based on that view. The children of the depression could never have been the free spenders of the 80′s and 90′s.
The myths of credit unions developed in the formative years of credit unions. Credit unions were a movement then, not an industry. Members were drawn to credit unions because credit unions met the financial needs of members who were underserved and overcharged by the banks. Credit unions had better rates and intimate, customized service levels. Member ownership and self-government gave members a sense of empowerment and independence from the factory owners and bankers who otherwise ruled their worlds. The “goodness” of credit unions was self-evident and did not have to be marketed. From those myths we tell ourselves that only credit unions really care about the members and know how to serve them. Only we know what is best for our members. These myths comfort credit unions with a false sense of security that the natural order of things will always contain credit unions and people will know through their DNA about the “goodness” of credit unions.
These myths will kill us. If credit unions are so obviously better than banks, why do we not grow market share? Why are we losing the battle for the youth market? Why do our members also use banks and other financial providers? It is time we see credit unions not through our traditional prism but through the prism the world sees us.
Myth 1: Credit union’s fees for services are lower than the competition and at greater service levels. Does anyone really believe this anymore? In today’s world, members can choose financial service providers that have scale and market power to deliver financial services at fees much more favorable than credit unions can offer and at greater convenience, such as ING Direct and Lending Tree.
Myth 2: Credit unions go out of their way to give people a hand when they need it. There is no doubt that credit unions do this and I hope they continue to do this. Having said this, credit unions cannot stay in business by having a portfolio of “character” loans. In today’s world, credit unions must use objective safe and sound underwriting criteria or they will go out of business.
Myth 3: Credit unions are better because they member owned. Sounds good but what is the tangible benefit? Dividend returns are a powerful means to drive home the membership difference. At DFCU Financial Credit Union in Michigan, a patronage dividend of 50 basis points is paid on loan and deposit balances. The more a member uses the Credit Union, the more value the member perceives and receives. This is a game changer. In the four years that the program has been in place in a state where the population is declining, membership has grown 5% and the average deposit balance per member has grown over 23%. If you give members a tangible benefit for doing business with you over your competition, they will come…and bring their money.
Myth 4: Only credit union people know how to best serve their members. This is paternalistic nonsense. Members want to be empowered to interact with the credit union on their terms. The world outside of credit union is full of very innovative and effective people. There are credit unions that are open to new ideas and innovation. They are open to finding the best service solution whether that is delivered by their employees or in collaboration with CUSOs and third party service providers. The credit unions that use an open sourced business model to deliver best of breed services to their members will be the surviving credit unions.
Myth 5: It is insulting and manipulative to sell to members and credit unions are above that. There is a reason that a large portion of the media and the public is ignorant about credit unions and credit union growth is stuck in a rut. Credit unions need to sell themselves to be heard in the very competitive financial marketplace. The world sees credit unions as just another box of cereal on the supermarket shelf. Why would the consumer select the credit union cereal over the bank cereal? If a credit union is proud of its product offerings, promote and sell them. Find the competitive advantages for your credit union and promote them aggressively.
The mission of credit unions is a noble one. People helping people. But we will not survive as an industry unless we see credit unions as a business, a business that needs to use all the tools of business to survive. We will survive if we embrace our structure and provide best of breed services wherever those services can be sourced and if we provide tangible member benefits. It is not enough to provide great service and benefits, we need to effectively communicate the credit union difference and use proven sales techniques in order to be heard by our members and potential members. It is time to shed the myths that are holding us back and embrace the world as it is not as a nostalgic fiction. Members will be better served and credit unions will survive to serve them.
Today’s blog comes courtesy of Jimmy Marks. Jimmy is the Creative Media Director at DigitalMailer, Inc. and a credit union member. He manages and contributes to several websites and blogs, including www.clickconnectcommunicate.com, www.cusoapbox.com, www.exigent911.com, and www.nothingtodowithcreditunions.com.
It was at the NACUSO regional meeting a few months ago that Ron Daly, my boss, described our work relationship as “Perry White and Jimmy Olsen”. I think this is a pretty sharp analogy. He’s the veteran “newsman,” a person who has been working for and with credit unions for more than thirty years now and, more importantly, a guy who always knows what he wants. I’m the nerd running around in a sweater vest (and yes, I often wear a sweater vest), snapping pictures, managing our websites and blogs, creating content and trying to stay “cutting edge.” So close is our resemblance to Superman’s Pal and Superman’s boss, I’ve actually started calling Ron “chief”. The jury’s out on whether he likes it or hates it.
If you’re as good at being a nerd as I am, you’re asking “Well, if you’re Superman’s pal and he’s Superman’s boss, who’s Superman?”
I decided after thinking about this for way too long (read: a few months) that our client base – the credit union industry – fit that roll pretty well. Every day, we hear stories about credit unions across the country reaching out to the underserved and underprivileged. We talk to credit unions about their initiatives, their charities, their pet projects, and their goals. Once in a while, a client of ours gets featured for their good work in a magazine or trade paper and we send around a “congratulations/”wouldja look at that” email here at DigitalMailer. Let’s face it – credit unions are pretty super.
But as any good nerd will tell you, Superman’s not always Superman. Sometimes, he’s Clark Kent. As first discussed by Jules Feiffer in the book The Great Comic Book Heroes (and later in the movie Kill Bill Vol 2 by Quentin Tarantino), Clark Kent is a critical part of who Superman is. Not only is Clark Kent the “alter ego,” he’s the human part of a man who isn’t human in any way. He’s also considered meek, clumsy, plain and unobtrusive. Everything Superman is and does is extraordinary, which is why everything Clark Kent is and does must be unremarkable. One can’t be the other.
Credit unions, this is Superman’s best pal, Jimmy Olsen, telling you to put on your cape.
Look! Up on the Web!
Let’s be clear – this isn’t my idea. I’m among a growing list of folks who want to see credit unions promote themselves, individually and nationally, and a larger percentage of the market. Guy Messick of Messick & Weber PC brought up credit unions’ market share at the aforementioned NACUSO 2010 Regional Meeting, saying that we should “get used to” that share if we didn’t start being bold and telling our story as an industry. His ideas were shared recently in this CU Times article regarding CU “myths” . There’s been a lot of struggle in the past few years, and that’s led to a lot of good press for us. We avoided much of the shame and struggle that fell on the big banks and we were praised for our fair lending and attractive credit card policies. You have Ondine Irving, the social media maven behind www.CreditCardConnection.org, to thank (in part) for credit unions’ sudden up-tick in publicity, thanks to her “partnership” with Suze Orman, who might be one remaining financial guru anyone trusts. www.MoveYourMoney.info has also drawn some attention to credit unions and small, community banks by insisting readers/followers take the pledge and move their money away from banks previously thought of as “too big to fail.” Then why aren’t we picking up more members and turning that increase in exposure into profit?
I think our push is getting hamstrung by negativity towards banks. We’re hung up on the mental image of a fat-cat banker in his sock garters and pasty bald whiteness doing terrible things with our money and laughing it off. Yes, people get mad at their bank. Will they switch? Probably not. They’ve been told that being with a big bank means more fees but greater convenience, which let’s face it, is hard to argue against.
Let’s go back to this Superman analogy for a second. Superman isn’t Metropolis’ favorite son because everyone hates Lex Luthor, the greedy bald billionaire. He’s their favorite because of what he does for everyday people.
“I was in trouble and the credit union helped me.”
“I trust my credit union, they’re always there for me.”
“My credit union is the one place I feel safe and sound.”
You’re going to get a million people in the CU marketing game that will tell you “service” isn’t a value add or a differentiator. That might be true, but I’m willing to wager the people who know the difference between a credit union and a bank would be willing to tell others about it in your radio spots, your TV ads, and in videos on your website. “Service” isn’t what sets us apart – it’s the sense of trust, humanity, and yes, community. Stop pouring money into buying royalty-free images and artsy-fartsy ad campaigns and start showing your real members and their real lives.
If you need a little thunder to start your brainstorm, here it is: Extreme Makeover: Personal Finances Edition. Talk about the before and after of a member’s financial life. Better yet, let the member talk about it. See American Express’ “Smart Cookies” page for an example of people making their outlook better because of AmEx, then start talking to members about why they’re with you and not someone else – another credit union, a community bank, a big bank, or the inside of a mattress. Whom did you, as “Super-CU”, untie from the tracks and whisk away to safety? We’re labeled as modest, but that doesn’t mean nobody can tell our story.
Smallville, KS
Jonathan and Martha Kent, a mid-western farming couple, raised Superman and did their best to teach their adopted son right from wrong. Imagine, for a moment, if Superman had landed anywhere else. Would he still have the same values? Would he find it hard to put on his cape every day if he hadn’t been raised on “truth, justice, and the American Way?” You can take the boy out of the small town, but never the small town out of the boy. I should know.
Credit unions were founded to promote thrift and to take full advantage of the spirit of cooperation – in communities, in companies, and in churches all over this country. We wouldn’t exist had it not been for a few enterprising souls who wanted to help their fellow man. Sound corny? Who cares, it’s the truth. And as the incredible Mr. Messick said at the aforementioned NACUSO meeting, success in the next few years is going to mean drinking a little bit of your own Kool-Aid. There are scads of million-dollar-plus success stories that started with a small credit union with a very niche member base turning into the premier banking institution for their area. Remembering where you came from is just as important as keeping a sharp eye on where you’re going.
“Has anyone seen Mr. Kent?”
Chip Filson at CreditUnions.com said credit unions were at a “tipping point”. We’ve got a spotlight pointed on us that’s getting brighter and brighter, and the need to meet those expectations outlined for us by the media is getting stronger. Could we get more members and more assets out of this? Yes, of course we could. But we won’t get it by being meek and wasting resources.
Get the word out about your credit union today. Email members and let them know what you can do for them. Generate a conversation in the branch that could lead to a cross-sell. Turn your loyal members into your living testimonials. It’s easy to do – all you have to do is ask.
Quit waiting for the Huffington Post to do your job for you – start telling people “You qualify for membership. Why aren’t you a member? Get yourself on over here.” Move your money? That’s too short-sighted. Make it “Move your money to THIS credit union TODAY.” Don’t be afraid to flash a tail-feather or two…chances are, you’ve earned the right. I’m inclined to say that if you’re still going after even the past TWO years, you’re doing something right. What is that thing you’re doing right? Tell me about it. Seriously.
As someone who started out not knowing what a credit union was or why it mattered, I can tell you there’s something special about where I put my money. I lose my debit card, I get a new one that day. I need a better line of credit, I ask and I receive. Someone talks to me when I have a problem. It’s an experience that’s hard to find these days. But it’s one I wouldn’t trade for anything.
So, let’s go, credit unions. There’s a lot of problems happening out there and they need a fix. Despite what the naysayers may tell you, you are just the institution for the job.
The meteor’s headed right for Earth. Ditch the suit. Lose the glasses. Fly.
Filed under: Survey, Uncategorized | Tags: credit unions, statistics, survey monkey, surveys
I promised that I would post a follow-up to the survey I ran last week and I think I have enough material to actually milk it for another post. For starters, I only received 22 responses. In order to have a meaningful survey, you really need 370 responses.
Here are the results:
Profitability and growth scored well. In a time of NCUA assessments and slow economic recovery, that makes sense.
Now we have no way of knowing who is answering these questions. Could it really be directors? Perhaps. The responses seem likely enough: strategic plans and coming to grips with changes are significant issues.
For all of you who answered this question, I highly recommend David Allen’s Getting Things Done. I’m serious. As far as I’m concerned he invented an unbeatable system of organization that will help you tremendously.
We actually had someone skip this one. It seems to be a toss-up but you should never underestimate convenience and how much people are willing to pay for it. Or using convenience to bring members into the credit union. For some reason this made me think of coin counter machines that are so popular with smaller credit unions.
So that’s my first foray into surveys and using Survey Monkey. If nothing else, it’s kind of fun. I may do more of this although frankly, it’s probably better suited for the trade pages and blogs that have a big enough audience to actually get close to a statistically signficant sample.
Filed under: Fraud Prevention | Tags: credit unions, Fraud Prevention, indicted, mules
by: Robert Rutkowski
When a person acts as a middleman for a con artist or grifter, plays stupid when the police get involved and then avoids prosecution because of lack of intent, it makes me crazy. To me this middleman, or mule, is essentially acting the same as someone driving the getaway car in a robbery. It bothers me so much, I made a video on how to spot mules a couple of years ago. Some of these people even avoid civil liability via bankruptcy!
So when I saw this Wired article yesterday, I was thrilled! The article says that this may be one of the first cases against mules despite the fact that mules are involved in hundreds of millions of dollars of fraud every year. In this particular case, it’s alleged that money was stolen from a third party’s account and then funnelled through the mules accounts to launder it. Usually what happens with respect to credit unions is that the mule presents a bogus instrument across the teller line and then tries to quickly wire out fund or get a credit union teller check issued to a third party who absconds with the money. The mule is almost always left behind to face a civil suit by the credit union but can avoid paying by filing bankruptcy: again claiming that the theft should be dischargeable because the mule did not intend to steal the money.
I am very hopeful that jurisdictions across the country start to follow California’s lead and seriously question a mule’s claim that he or she had no idea that the underlying activity was fraudulent. In 2010, this should not be a valid defense. Being paid to cash checks for another person is not a legitimate business activity!
Filed under: technology, Uncategorized | Tags: app, credit unions, ipad, iphone, ipod
By: Robert Rutkowski
Much has been written about grabbing the Gen Y audience and otherwise leveraging technology to reach out to new and existing members. Looking at the app store for iPhone/iPod/iPad, it shows that many financial institutions (including credit unions) have apps that offer a variety of services. On the more extreme end, a credit union could run a billpay app or something more pedestrian such as finding locations or checking account balances.
In deciding whether or not to take the step of actually creating a credit union app, the first question is how much would it cost? I have heard the number $30,000 thrown around as an example. Really it depends on what you are trying to do. If you want to show your members where you’re located, there are app creators out there that would help a credit union create an app for very little. On the other hand, interfacing a bill pay system through an app would be complicated and accordingly, expensive.
Expense is only one factor, however. Would your members even use it? If your membership base (or your potential membership base) is not tech savvy or not very interested in using apps or internet related products, creating such an app would probably bring a low return on investment. On the other hand, if your targeted member medium or existing member base is young and tech savvy and more importantly, interested in technology, an app could be very exciting to these people. Anything that establishes a communication base between you and a significant number of your members has value. How many of your members use bill pay now? How many of them are potential iPhone/ iPod/iPad users? How many people would ultimately end up using this type of product? This may be hard to identify, especially for a smaller credit union. Perhaps a membership survey would be of some value or even something more informal on the credit union’s website.
Finally, is it even possible for your credit union to interface its data processing system with an app? Ultimately, that is a question for your data processor. Certainly, if you have a bill pay product now, that sort of thing is possible. Depending on how your data processor handles its products, it may or may not be able to help you in this endeavor. I recently gave a seminar where one of the Credit Unions identified the fact that there data processor actually ran the credit union’s bill pay through ATM processing thus, placing its bill pay service within the new Regulation E changes. Such a bill pay system might have trouble getting linked to an iPhone/iPod or iPad via an app. On the other hand, the system using the ACH process probably would link more easily. The credit union wishing to develop an app should involve its data processor, involve its data processor at the very beginning.
For the right credit union with the right membership base, an iPhone/iPod/iPad app would be a good investment to offer enhanced member services and reach out to potential members.
