SAN DIEGO—In at least one scenario, for many credit unions the bottom line is increasingly about letting someone else carry the burden.
"A few years ago we might have had one to two of our in-house credit union clients move to outsource with us. This year we have 20 already," said Ted Bilke, president of Symitar, a Jack Henry company.
In addition to the threat of cyber-attacks and the burden of monitoring regulations, Bilke said decisions are often being made when the credit union faces a need to invest in new hardware or software. "Sometimes what prompts the change is turnover. There usually is some type of catalyst event that causes the credit union to stop and say, 'There has got to be better way.'"
More CUs are also turning to CUSO arrangements, with six to 10 partnering to share data processing equipment and staff. Bilke also said the trend toward virtualized equipment continues to grow.
Overall, moving to an outsourced arrangement is not being done to save money as much as it is to gain peace of mind, concluded Bilke. "I think there can be a modest cost-savings, but I would tell you the drive seems be just simplifying their operations and letting someone else have the responsibility."
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