It recently took Daniel Weickenand an hour to get an auto loan from Orion Federal Credit Union. That might not sound bad until you consider he's the credit union's CEO.
"I was preapproved, but it took me an hour to get a check and get my car. That's not acceptable, but it's how our system worked," says Weickenand, who's embarked on a nine-month project to make the bank's lending and other systems more efficient. Weickenand is spearheading a core upgrade at the $535 million-asset, Memphis-based credit union, which was founded in 1957 as the Memphis Area Teachers' Credit Union.
The 43,000-member credit union will replace a 20-year-old legacy system and a number of point solutions with Corelation's KeyStone core processing system, which Orion will operate in house with the tech firm providing external maintenance and compliance updates.
Banks of all sizes are challenged to upgrade their core systems to accommodate innovations that have become staples of banking, such as mobile banking, straight-through processing and remote deposit capture. At community banks and credit unions, the need is particularly acute, since these institutions rely on personalized, convenient service as a competitive differentiator.
Orion hopes to reduce the time required to obtain approvals and complete customer-facing transactions from hours to minutes. The credit union also hopes to perform near-real-time security updates, as opposed to the timing of the current fraud detection system, in which vulnerabilities are spotted and updated in the span of about 24 hours.
The teller line is ripe for such efficiency improvements. "Some of the tellers are still using an old DOS-based system, particularly the tellers who have been with us a long time," Weickenand says. "It's evident with the lines of customers out the door."
The conversion will take place over the next nine months, with the credit union going live over Labor Day weekend. The credit union and technology firm didn't disclose the cost of the project, but Weickenand says the credit union hopes to save expense by streamlining workflows and reducing third party relationships. The credit union offers a full slate of digital banking products, such as mobile banking, and hopes to centralize the maintenance and upgrades to enhance those services in the future.
"I have three solutions for accounting, one for collections, one for marketing, the list goes on and on," Weickenand says. "Anybody who think's you're going to make money the first day form a core conversion, it's not going to happen. It's a savings over time. It's not the cost of the [core system] that's an impact. It's the cost of maintenance or programming new software."
To execute the project, Corelation, which faces competition from FIS, Jack Henry and Fiserv in the race to improve core systems, will have staff on site and at its offices in San Diego who will match the core system to the credit union's processes. The tech firm will also train the credit union's staff.