In a period of significant global economic instability, the financial services sector is going through a significant period of disruption. This has been especially challenging for credit unions, who need to leverage a variety of methods to keep cash flow as stable as possible. Thankfully, there are ways to use this newfound disruption to optimize revenue streams moving forward. They require organizational leaders to keep a few key things in mind.
Put the Focus Where it Belongs: On Relationships
One of the biggest assets a credit union has is - and will always be - the relationships it is able to forge with its members.
People join credit unions for more than routine banking services. If that is all that was desired, members would go with one of the many other alternatives out there. Instead, credit union members want something different: a relationship that shows their financial institution cares about them and their financial success.
One opportunity to accomplish this takes the form of reward checking. While most people would probably willingly sign up for a checking account on their own, they are likely to use it more frequently (as opposed to other accounts they may have) if they know they are getting rewards on top of it.
Another technique that many credit unions rely on has to do with offering various incentives through product offerings like relationship pricing. This is an ideal way to maintain that long-term connection with members in a way that also increases engagement. Members are more likely to try services that they may not have otherwise been interested in or aware of.
Helping Members Establish Credit
On the subject of relationships, remember that not all members are in the exact same situation when referring to their finances. Some will have a lengthy credit history behind them comprised of years or even decades of positive activities. Others may not have much of a credit history at all, or might not have any other established relationships with financial institutions to refer to.
By helping these members establish credit and instilling within them sound financial practices through services and technology, a credit union is accomplishing a few different things in one fell swoop. They are building and maintaining valuable relationships with members in a way that instills loyalty. The credit union is also molding people, little by little, into ideal members. Those "ideal members" are the ones who historically bring in the largest amounts of revenue as well.
Mobile and other digital resources are a great way to get started to that end. These services allow members to leverage anytime, anywhere access to services - providing a level of freedom and flexibility that may have been lacking in their previous banking experiences. Really, success in this regard is all about being a convenient, consistent resource for members that can also provide educational assistance to those who need it the most.
Embracing the Self-Service Era
Finally, credit unions need to embrace one of the most important financial services trends of the last few decades: Self-service.
While people certainly still like walking into their credit union and speaking to a live employee, someone will not always have the time - or the desire - for it. Sometimes, members want to perform a quick task and self-service options help them do it.
According to one recent study, roughly 39% of credit union members did not enter a branch on their last banking visit. Instead, those under observation used exterior cash machines - if such machines were available at a particular location. That is still far too large of a number to let that many people go without the expected level of service.
Even offering Internet banking through a browser or mobile banking through an app, along with access to both someone's account and a credit union's products and services, will go a long way toward helping people meet this self-service need. A member would not have to come into a branch to perform a task like a transfer. The totality of the process happens in seconds.
Another opportunity in this category has to do with ITMs. Using a solution that offers integration with ITMs allows credit union members to easily self-serve via teller cash dispensers. In addition to giving people even more options in terms of how and where members use a credit union's services, it also creates a more satisfying and engaging experience as well.
The FLEX Approach to Credit Union Success
In the end, credit unions have long been known for a more personal - and forward-thinking - level of service than the alternatives. People join credit unions looking for something different. Something innovative. Something that meets their unique needs, no matter how specific those needs happen to be. The above best practices are ways to accomplish precisely that, all while allowing credit unions to optimize their revenue streams as well.
To leverage all of these ideas and more, check out our Member Services eBook, providing insight to help you achieve these goals.