NEW YORK Credit unions can increase non-interest income by building deeper relationships with members, especially the growing multitude of new members added over the past 18 months, according to one expert speaking at America’s CU Conference Tuesday.
“During the past 18 months, credit unions have added a great number of new members,” said Bob Larson, financial support consultant for CUNA Mutual Group. “Credit unions need to make sure they tap into new members by cross-selling additional services: loans, debit cards, credit cards, bill pay, etc. The more services, the deeper the relationship.”
“You will do better in today’s economy by focusing on what you can control, not on what you cannot control,” said Larson. “Start with understanding your current credit union membership as well as those who have just joined your credit union.”
He said credit unions should make sure they have a strong, transparent sales culture focused on building lasting member relationships. Larson explained that a credit union’s sales culture should start and end with the member.
“Let the member control the process because, as Roy Bergengren so eloquently stated, the most important service of the credit union is the education of its members in the management and control of their money,’ which is exactly what ultimately drives your credit union’s sales culture,” said Larson.
Current market conditions have greatly impacted credit unions’ earnings, he continued. Now, more than ever, he said credit unions must explore every aspect of their income statement to leverage additional income and to keep their revenue stream flowing. Larson added that members’ and credit unions’ interests have never been so well aligned before, so credit unions should take advantage of this by aligning their sales cultures to meet members’ needs.
Larson said with the future threat of rising interest rates, credit unions should take time to develop a strategy to move some of the certificate dollars from the credit union’s balance sheet to the credit union’s wealth management program to help improve the loan to share ratio, which will generate additional non-interest income in the form of gross dealer concession for the credit union.
