FAIRFAX, Va.-If credit unions continue to "sit on the sidelines" and don't "get into the game," the industry may not be around in 2109, warns one national branding and marketing consultant.
"Since the 1990s, credit unions have not experienced real growth," said Paul Lucas, who also cautioned that a global economy in 2109 will put further pressure on credit unions to perform. "If they continue to sit on the bench they may not be around in 100 years."
To make it to 2109, credit unions need to become retail lenders, get better at member education, and look toward large-scale collaboration to streamline operational efficiencies, offered Lucas. "Most credit unions are not effective lenders, they are savings clubs. If your loan-to-share ratio is under 60%, you are not lending money effectively. A credit union that's a good retail lender has a loan-to-share ratio is in the mid-'80s. I know it can be difficult to get there, but that's what we need to do."
Lucas also challenged CUs to be more effective educators. "Credit unions say they are really good at education, but why do only two out of 10 members have car loans with the credit union? Education is about making sure members understand your culture and your brand."
To survive, credit unions also need to look into many more ways to collaborate, especially nationally. "They need to collaborate to streamline operations and drive efficiencies," Lucas said. "For example, establishing a central data processor all credit unions could use. That would really cut expenses. If credit unions leverage the movement, nationally, that would be very powerful."
