CU Members Who Use Banks Are Still Loyal
Even if credit union members use banks for some of their financial transactions, they are much less loyal to those financial institutions, according to a new study by CUNA.
The study suggests that fact "gives credit unions an opportunity to increase their members' loyalty."
"While 90% of credit union members also do business with a bank, only 11% are 'truly loyal' to their banks," the 2006-2007 National Member Survey from CUNA found. "However, nearly 25% of credit union members are considered 'truly loyal' to their credit unions."
"Although credit union members choose banks over credit unions as their (primary financial institutions) by a margin of nearly 3-to-2, they are much less loyal to these banks," said Jon Haller, assistant vice president, CUNA's Center for Research & Advice. "Couple this with the fact that the average amount in loans outstanding-excluding first mortgage loans-at the credit union among 'truly loyal' members stands about 75% higher than that held by less-loyal members, and it's plain to see the tremendous opportunities for growth here."
CUNA reported that those who were "truly loyal" to their credit unions meet all four of the following criteria:
1. They are "very satisfied" overall with the credit union.
2. They "definitely would" recommend the credit union to a friend, family member or co-worker.
3. They indicate the credit union "definitely would" be the first financial provider they contact the next time they are seeking to open a savings account, or obtain a loan or other financial service.
4. They indicate the credit union is their primary financial institution-the institution where they conduct most of their financial business.
Another 20% are classified as "moderately loyal" to their credit union, satisfying three of the four criteria, CUNA said, noting that at the other end of the spectrum, about 20% of members are "not at all loyal" because they do not satisfy any of the above criteria.
CUNA also released a companion report-the 2006-2007 Survey of Potential Members: Opportunities and Challenges in Growing Your Membership. It explores the degrees of bank loyalty found among non-members who are eligible to join a credit union.
For info: www.cuna.coop.