PLANO, Texas-Small credit unions need to survive, according to Catalyst Corporate CEO Kathy Garner.
But need and ability have become two separate things for many small CUs. As Credit Union Journal has reported as part of its ongoing "Great Divide" series, growth is primarily occurring among the largest CUs. NCUA Chairman Debbie Matz recently noted that two-thirds of small credit unions lost money last year.
Garner said she and the rest of the management team at Catalyst "are concerned as everybody else."
"Financial services are a commodity and it is a scale business," she observed. "But small credit unions are important and they fulfill great niches."
Paying Less For Payments
According to Garner, Catalyst's payment products can save smaller CUs a "tremendous amount" of money. Mobile services are "something many tell us they never could offer without us," she reported.
"We help smaller credit unions manage cash," she said. "Helping them with good pricing and products that can help them grow membership is important. Large credit unions could do it without us, but it would be more expensive. But small credit unions get cooperative pricing and access to all products from one vendor, which is big."
There's also another issue that has overwhelmed many.
"The smaller the staff, the more compliance truly is a burden," she said. "We can help with payment reporting and Bank Secrecy Act reporting. With all the Dodd-Frank disclosures needed for an international wire product, our product will give small credit unions an attractive fee product and we handle all disclosures required."
Despite severe negatives facing smaller CUs-and large numbers of them disappearing in mergers every year-Garner noted there are positives.
"Many are highly capitalized, so hopefully they can make it through until the economy turns and loan demand increases. They do fill a niche, and I think there is a place for all of us."
