NCUA's fourth-quarter report on the health of credit unions was good news indeed, as noted by Palash Ghosh in his March 4, story in the Credit Union Journal ("
At the same time, it's worth promoting the value of credit unions' contribution to the U.S. economy — making a record $410 billion in loans so people can buy homes, start their own businesses or earn college educations.
Yet, even with our excellent statistics, credit unions of all sizes are facing challenges. Technology is changing at near-nano-speed. We're competing not just with big banks, but also fintech companies that are working hard to make banking as easy as buying coffee at Starbucks. As digital takes center stage, sustaining our good results means thinking differently.
To do that, let's first revisit our cooperative roots and find more ways work together. Regardless of their size, most credit unions can't afford on their own to lay out huge amounts of capital for R&D, testing and implementing new technologies. But there are numerous opportunities to collaborate — either with credit unions in the same geographic area, those that serve similar types of members or through formal structures.
Second, let's recognize that the real competition isn't each other. Worrying about losing a competitive edge keeps many from sharing resources, but it's seldom that a credit union's key competitor is another credit union. Instead, our competition is BIG banks, BIG retail and FinTech (big and small) — with technology providers like Apple and Google undoubtedly the biggest concerns.
Whether it's exchanging best practices, sharing back-office functions or pooling resources to research new products — collaboration works. When credit unions practice the cooperative strengths that made our industry thrive from the beginning, we'll see our numbers climb even higher!
Jeff L. Kline is CEO of MEMBERS Development Company, a credit union service organization based in Overland Park, Kan.
