DURHAM, N.C. -
For $75-million Duke University Federal Credit Union, the Oct. 23 opening of its new 18,000-square-foot Erwin Square headquarters will mark a deliberate move to the campus crossroads of both the school and the mammoth Duke University Medical Center, both of which fall into the credit union's field of membership.
The increased visibility should help keep the single-sponsor credit union, operating as a department of Duke University, from further disappearing among the dozens of other university departments, organizations and activities, according to Lee Fogle, the credit union's CEO.
Investing In Brick And Mortar, Technology
Despite a significant investment in new brick and mortar, however, Duke University FCU for the past decade has emphasized its electronic financial services, trading on the fact that its highly educated, well-compensated membership will embrace the new technologies' convenience, while hoping that ease and portability of electronic use will keep a highly mobile body of students, faculty and administration tied to the credit union long after individual members disperse to other parts of the country, Fogle observed.
"The Duke system has 30,000 employees, two-thirds of whom turn over every four or five years," said Fogle, a 30-year industry veteran who's been the credit union's CEO for the past 10 years. "The whole idea is that people want convenience and portability, so we're selling our e-services first."
The new headquarters will double the size of the former, less centrally located facility, allowing the credit union to expand its schedule of personal finance classes and counseling to members. However, the new facility's seeming dichotomy with the credit union's e-service emphasis does come with an electronic silver lining. The new office will allow DUFCU to permanently close one of its other facilities, reducing to two the credit union's brick-and-mortar presence on the university's and medical center's combined campuses.
"Research shows that three-quarters of our members never come to the office and 66% prefer to do their transactions through ATMs," Fogle said. "Just about all of our development over the past 10 years has been in support of our e-services initiative."
40,000 Hits Per Month
The credit union will continue to invest in its current 10-machine ATM network and continuing cultivating transaction services through its website, which Fogle says receive an average 40,000 hits per month.
Typical teller usage has fallen off 28% in the past four years, with much of the traffic headed toward Web-based electronic options, he said.
Like some other credit unions, Duke University FCU was enjoying double-digit annual growth right up to the terrorist attacks of 2001. Changes in the interest rate environment and other social challenges have slowed that growth to a strong, steady single-digit gait, one that the credit union's e-services have helped foster and grow.
Fogle admits that the move to electronic options may have been a lesson hard won. In 2002 the credit union opened a full-service branch with a staff of five in Duke University Medical Center, quickly learning the limitations of that particular expansion strategy. Placed inconveniently close to the cafeteria, the credit union became the place when members merely cashed checks and discussed disputes in account activity.
"They used us mostly as an ATM and didn't have the time over lunch to talk about loans," Fogle says.
The credit union in 2004 turned the branch into a primarily electronic service center with minimal staffing and more automated options, preferred by a membership whose average family income is $78,000 and average age is 49.
The move coincided with the credit union web-based portfolio of options, including debit cards, electronic bill-paying and Internet-based loan approvals.
Despite the aggressive electronic initiative, development resources and a lethargic marketing effort still continue to challenge the credit union.
Fogle hopes the new location will help bolster the credit union's presence and support its image among members, who comprise about half the current campus population.
However, Duke University FCU will likely continue to view itself as small, but not in the usual sense.
"If you don't have enough of the services your members want and need, you can be small no matter what your asset size," Fogle said. "We're small because we're always trying to provide more services for our members."
