The ABC's of E-Statements
Online loan approvals, bill payment and check reorders...like many areas of credit union service that have undergone technological revolution in recent years, monthly account statements, the most basic service of them all, also has taken to the electronic highway driven by lower costs and more timely delivery of information.
For credit unions turning to electronic statement delivery (e-statements), there are many competitive advantages. By providing e-statements to your members, you can take advantage of more vibrant, less-expensive cross-marketing opportunities. Moreover, you eliminate postage and paper costs, and can deliver statements within hours (not days) of each statement cycle.
If your credit union makes the determination to offer e-statements, there are numerous considerations to make, many of which will also help you in the vendor selection process:
Should you offer e-statements through your home banking platform or on a stand-alone system?
Integrating your service with home banking enables your members to access account information, perform transactions, and obtain their statements through a single Internet session (commonly referred to as "single sign-on" capability). For a credit union with a large investment (and penetration) in its home banking product, this may be the best approach.
On the other hand, offering e-statements through a stand-alone system has its own set of advantages. For example, with a stand-alone system, your credit union doesn't have to pay the home banking provider to use its channel. What's more, it typically provides a broader market for the service because members don't have to be registered users of a home banking system to obtain their statements electronically. All a member needs is an e-mail addresses and Internet access. Indeed, credit unions that do not offer home banking services can nevertheless offer e-statements to their members using this model.
How will e-statements be integrated with print statement production and delivery?
This is a matter of handling statement files efficiently and conveniently. Separating these activities means working with two vendors, splitting files, and managing additional routines. Many credit unions value the convenience of working with a single vendor for both, especially if e-statement enrollment and unenrollment activities are automated and require little or no staff intervention. Many vendors offer both forms of production, so be sure to interview them about their capabilities.
What opportunities exist to cross-market your credit union's products and services?
In many ways, e-statements can provide a more dynamic marketing channel than traditional paper inserts because they are interactive, less expensive and more easily updated. For example, an online loan promotion banner can lead people directly to a loan application and decision-making system. Ask potential vendors how and where marketing messages are administered and where they appear. Also ask what, if any, retail marketing support (e.g., electronic banners, lobby displays, statement inserts) is available to help make your sales efforts more cost efficient.
What else can the e-statement link to for additional functionality and appeal?
Linking to check images or check-image statements is a valuable feature of a well-designed electronic statement delivery program, and one that appeals to many members. This feature is typically inexpensive, and it also helps make your share draft program more attractive.
You also may want to consider whether certain e-statement features add value to or diminish your overall electronic service strategy. For instance, data export and transaction sorting features of e-statements may have flash, but if they duplicate features of your home banking product, they may cause confusion for members and support staff, and cause you to spend more than is necessary.
Will electronic statement delivery truly save your credit union money?
While e-statements can save on transaction costs (e.g., paper, handling, postage), you will need to be alert to a vendor's start-up and monthly maintenance costs. Because each vendor bundles its service and prices in a slightly different way, comparisons can be confusing. Make several projections of market penetration and compare vendor costs accordingly. In any case, for credit unions that successfully promote e-statements, break-even should come quickly.
Today, more than ever before, credit unions rely on technology to increase the effectiveness and efficiency of their day-to-day business. E-statements are growing in popularity and institutions that offer this service will have big advantages over those that do not. Choose your delivery system and vendors carefully, and you will benefit for years to come.
Alan Bernstein is senior vice president for Eastern Corporate FCU, Woburn, Mass., the only corporate to offer a complete in-house print and electronic statement service exclusively for CUs.