Everyone loves an underdog, right? Credit unions can be viewed as the underdog of the financial sector. When CUs first came to America, they were intended to help the little guy - providing affordable credit to working class families, the ones big banks refused to service. In the 70's, they began to offer bigger services, like mortgages, to keep competitive with big banks. By the 80's, they began to lift restrictions on membership to allow in a broader clientele. They've continued to grow and evolve ever since, offering competitive rates and products to the major banks. But, despite the continued growth of the industry, there still exists some major misconceptions about CUs, and it's time we overcome them because people are missing out on the credit union difference.
According to a recent survey undertaken by a New Jersey credit union, in collaboration with Harris Polls, these are the top four misconceptions about credit unions:
Misconception 1: Banks offer more products and services than credit unions.
With large marketing dollars at their disposal, big banks are constantly advertising their products and services across multiple platforms. As they compete against other big banks, they are not shy about touting their latest offerings. With even larger product development budgets, and in house staff to implement, they are constantly coming up with new services to tout. While credit unions work with lower budgets for product development, partnering with the right technology vendor that stays ahead of the curve on products and services is crucial. Having a robust core with the ability and willingness to integrate easily with new offerings will ensure you have what members need. Then, member education and acquisition becomes the final step.
Misconception 2: Credit Unions don't offer mortgages.
This was suggested by 42 percent of those surveyed. Not only do credit unions offer mortgages, but they have done so for almost 50 years! This misconception is disturbing since Mortgage loans are very profitable for CU's. Implementing eSignature enables members to electronically sign loan documents and other materials reducing the time to close the loan and eliminate unnecessary trips and meetings. This is the perfect opportunity to advertise how easy it is to open or refinance a mortgage with your credit union, and word of mouth will spread among members quickly.
Misconception 3: Credit unions don't offer mobile/online banking.
With a whopping 45 percent of respondents believing CUs aren't mobile and online, CU marketers clearly have some work to do. Credit union technology providers have worked hard to ensure CU's have the ability to embrace not only basic mobile banking and internet banking but provide expanded service offerings such as mobile lending, billpay, RDC and more. Encourage MSR's to ask members if they have used the mobile app and offer to help them download the app and set it up.
Misconception 4: I am not eligible for a credit union membership.
Nearly two-thirds of respondents believed they did not meet the membership requirements of their local CU. Community chartered CU's are on the rise, while even closed credit unions have much looser restrictions than in the past. Some credit unions have changed their names to indicate their new charter. A less drastic approach would be to change up your marketing taglines to point out your more open membership and include this in all marketing material.
Did respondents in this survey get anything right? Yes, in fact, 61 percent of them believe that credit unions care more about their members than banks. At least the credit union difference is obvious to most, but now it's time to prove that all the other aspects of a CU vs. a bank are not all that different. Which in turn, will make the underdog really stand out and win new members!
