A new partnership between the New York Credit Union Association and Chicago-based fintech firm SpringFour is designed to help financially struggling credit union members gain easier access to local resources and institutions that can help them improve their financial situation.
Specifically, under the partnership, NYCUA-affiliated credit unions can visit the association’s website and enter the zip code for a member who is facing financial hardship. The platform will then generate a list of local organizations, government programs and other pre-approved resources that might help that member.
Those resources are provided through a platform developed by SpringFour, which aims to provide consumers with referrals to local nonprofit and government resources in order to help improve cash flows and deal with the underlying causes of financial difficulties, such as unemployment, the high cost of child care, or helping consumers in need of credit and housing counseling services, lower prescription drug costs and more.
“We work with our subscribers to connect consumers to local financial health resources and tools that are helping them save on average $250 per month, thereby freeing cash that can be used for other financial needs, or which can help people to begin to save for retirement, emergency savings or paying down debt,” Katie Gottschall Donohue, VP of strategy and operations at SpringFour, told Credit Union Journal.
According to NYCUA President and CEO William J. Mellin, all across New York “there are consumers who, often through no fault of their own, are struggling financially. We believe there are many credit union members who will benefit from the trusted, vetted resources that SpringFour connects them with.”
Rochelle Nawrocki Gorey, SpringFour’s cofounder, president and CEO, called the partnership a “natural fit” because “credit unions and SpringFour share a common goal of helping consumers get to a better place financially,” she said in a statement.
First foray into CU space
The partnership with NYCUA represents SpringFour’s first foray into the credit union space, said Donohue. “We believe that credit unions’ dedication to their members and full service model are a complement to SpringFour's mission to bring financial health to consumers,” she added.
The alliance, she said, began as a result of discussions between SpringFour and OwnersChoice Funding (a mortgage company owned by NYCUA) about the potential of using SpringFour when servicing credit union loans in the call center. “As we further explored this partnership, OwnersChoice brought in the NYCUA as well, believing that the SpringFour direct-to-consumer tool would provide additional services to NYCUA members through their website,” Donohue elaborated.
The agreement with NYCUA runs for two years, though Donohue organizes hope it will be extended beyond that. SpringFour also hopes to establish additional CU partnerships, she said.
Measuring success
Donohue said SpringFour will measure the partnership’s success by evidence that CU members are using the platform to reduce household expenses, thereby allowing them to catch up on bills and begin to save.
“We will measure the number of referrals, amount saved and repayment rates,” Donohoe said. ”We expect to see repayment rates increase – if we can help people identify ways to cut expenses, they will be able to catch up on past due bills. We also expect to see increased employee engagement at credit unions because our tool will help improve the ability to serve their members.”
From NYCUA’s perspective, the association’s Communications Director RJ Tamburri said that over the years the league has partnered with “many organizations” that help credit unions and their members. “But our partnership with SpringFour is unique in that it is specifically intended to benefit credit union members who are struggling with their finances,” he told Credit Union Journal, adding that helping consumers improve their financial situation is a core component of the credit union philosophy.
In terms of measuring the partnership’s success, Tamburri indicated that the “numbers aren’t so important.”
“It’s really about helping credit union members facing personal financial tumult,” he added. “If SpringFour helps even one New York credit union member regain control of their finances, it will be a success. If it helps foster a deeper relationship between the credit union and the member, that’s an added bonus.”
