It's Nice To Share (Costs, Worries, Ideas, Opportunities, Fears) And Your Branches
Having relocated recently, I've been looking about for a new credit union to join. High on my list of criteria in making a choice? Branches. Which is odd, since I visit my current CU about as frequently as Dick Cheney downloads Al Franken's radio show to his iPod.
Apparently, as the cliche goes, old habits die hard, and while I have direct deposit and do nearly all my business with my credit union online, I, like so many other Americans, like to be able to see the branch and visit my money-in my case, both of my dollars.
More than anything, the reason it seems branches rank so highly among consumers' desires when choosing a financial institution is the comfort that a branch is nearby in the event of that much fretted about, seldom-if-ever-realized "financial emergency." In those cases, the branch is sort of a "Financial ER."
So it will be most interesting to watch how the acquisition of FSCC and its shared branching network by the CO-Op will play out, and particularly how credit unions will leverage this new partnership. Several years ago I used this space to ask, "Why isn't every credit union branch a shared branch?" That is, why can't I and every other member walk into any credit union branch, identify myself with a membership card, and conduct my business? (If credit unions are smart they will make the credit card the required membership card; just swipe it through a terminal as you do at any airport ticket terminal, show another form of ID, and you're good to go. Yes, I know there will be a host of system integration issues, but it wouldn't be credit unions if it weren't).
Speaking of integration issues, the good news is that technology won't be the Shrek-sized speed bump credit unions need to get past when it comes to a national branch network; internal politics and rivalries will be. When I posed that question about why every branch isn't a shared branch, CUSC's Craig Beach and FSCC's Sara Canepa-Bang responded by explaining how they have had to take time to answer CU fears over members being poached and costs and the fact members using a shared branch tend to conduct transactions, not apply for a loan or another relationship. Credit unions that are on board with shared branching soon realize those fears are unfounded, they both said.
All of those fears will have to be allayed again in selling the CUSC-CO-OP partnership to more CUs. One wa to do that will be to keep credit unions focused on what the future could potentially hold. The ability to offer members a national branch network would overcome one of the biggest obstacles credit unions claim they face in continuing to grow (note that the emphasis is always on "national" access when most members really just want greater access where they live).
Imagine the possibilities. In last week's issue, for instance, the Journal reported extensively on lending strategies. Now imagine a national and coordinated "loan sale" among all credit unions once or twice a year. Imagine a national membership promotion campaign. Imagine CUs working together to accomplish all that. OK, perhaps that's actually fantasy, but the CUSC CO-OP deal is a good first step.
Frank J. Diekmann can be reached at fdiekmann