Ideas Shared On Growth At Small CUs, Kids Accounts
Two credit unions attending the PALS Conference here had advice for their peers on how small CUs can further their own growth and how kids' accounts can pay off for everyone involved.
Credit unions at the meeting, organized by NCUA Board Member Debbie Matz, had this to say:
* For small credit unions to attract new business, they must enter into partnerships, according to Barbara Black, CEO of the $6-million Community Choice FCU in Indianapolis. "When your credit union is small, you can't be all things to all people," Black told the PALS workshop. "You have to focus on where you want to make a difference, then build partnerships to expand your outreach and provide services you could not provide by yourself."
Black's presentation outlined 20 potential partners that can help small credit unions offer virtually any service that large credit unions can. For instance, Community Choice is partnering with state and local development organizations to offer business loans from $500 to $40,000. "These loans are too small for a bank to be interested in," Black observed, "but they really fill a niche. They are helping people who want to run their own small business and need a little bit of capital to get started."
Meanwhile, Gary Regoli, CEO of the $400-million Boeing Wichita Credit Union in Kansas, added another potential partner that is often overlooked: larger credit unions. "We have many services to offer other credit unions, but many smaller credit unions are afraid to ask." For instance, BWCU's CUSO offers business loan underwriting service to smaller credit unions. And BWCU's mobile branch operates with "the passion of a small CU" by bringing services to members who need them most.
"I think smaller credit unions are still the strength of the movement. Sometimes in medium-sized credit unions we lose our passion. The key to credit unions' success is finding that passion."
* At South Division Credit Union in Evergreen Park, Ill., kids are more than just kids stuff. Geraldine Burek found a passion for reaching the next generation of members. As CEO of the $50-million South Division Credit Union in Evergreen Park, Ill., she said she realized "members were getting older as the result of our original sponsor's 'cradle-to-grave' philosophy. Children were not being recognized for what they really are: an underserved segment of our market."
Burek changed SDCU's culture to treat children not as custodial accounts, but as "equal members, just like adults." For example, students get their own accounts with free checking, an ATM/debit card, financial education-and even access to credit lines as high as $10,000 for student-run businesses (such as lawn-mowing). As a result, 17% of SDCU members are now under age 21.
"We've had only one bounced check from a student in two years," Burek reported, "and some of their counseling rubs off on their parents. One mother constantly borrows money from her teenage son who saves more than she does and knows how to use a Visa Check Card. The fact that these kids are such good members has a positive effect-they make their parents better members."
For more info: www.ncua.gov.