The last blog addressed how the credit union hug is a superpower. This blog will discuss the credit union industry's robust amounts of data and the level of trust.
Superpower #2: Data and its power to Improve member's lives
Credit unions have more data than amazon, but Amazon has been casting a long shadow over much of retail with its "Amazon effect." The Amazon effect is two-fold. First, it has given the consumer an incredible amount of choice and secondly speed in delivery. The consumer now has a 7/24 expectation of fulfillment. This is a challenge. To combat this challenge, credit unions can connect their robust data and use it to solve the members' problems. Here is where the superpower kicks in, credit unions have more data than amazon. I know that it is difficult to believe, but Credit unions have, on average, 60-100 different data systems. These data systems hold valuable information, such as age, income, creditworthiness, and more. Amazon would love to have this information. When credit unions harness their data and connect it, they help the member achieve their financial dreams. These dreams can range from purchasing a home for the first time or buying a car for the 7th.
Superpower #3: Trust in doing the right thing.
Due to the cooperative nature of credit unions, they have an innate member focus. This focus is most prominently seen in the service given to the member. During the great financial crisis, credit union members were more likely to experience an open door at the credit union to discuss their current finances and build a financial re-structuring plan than at a bank.
Dan Berger, NAFCU CEO, wrote in an August 2019 article that the current state of member trust is "A key advantage" over traditional banking. Berger stated, "American consumers are increasingly turning to institutions with altruistic missions and to those that actively put the interests of their customers over corporate greed and profit maximization… This trust is a result of our industry's mission of strengthening communities and providing safe, affordable financial services; it is ingrained in our industry's creed as not-for-profit, member-owned cooperatives.
This is the credit union difference: deeper, more personal member relationships, better rates, and lower fees, and always putting members first. Without question, credit unions' not-for-profit status and consumer-centric business model will continue to attract American consumers."
Quick credit union industry superpower recap.
In the credit unions superpower arsenal are:
1. Member "got your back" trust
2. Cooperative "we Hug" business structure (principle and voting)
3. More data, "Whoo-hoo" than amazon.
These powers are awe-inspiring, and how they will be leveraged is up to each credit union.
"With great power comes great responsibility." Stan Lee.
Looking for more ways that data can create revolutionary member relationships?
1. What is your DATA WHY?
Like with all large initiatives, there has to be a vision statement. An example data vision statement is, "To create revolutionary member relationships." And yes, connecting enterprise data is the foundation to that, but the WHY is around impactful member engagement. The data vision should be clear and have the support of the organization. Let THRIVE help you craft your Enterprise data vision. Email Anne at anne@anneleggthrive.com to learn more.
2. Credit unions have perfected loan governance, but what about data governance?
Data is one of the most robust assets that a credit union owns, yet many credit unions are not giving it the respect it deserves. Data governance, while sounding big and unwieldy, is very similar to loan governance. A credit union defines, prioritizes, audits, and creates policies and procedures for its loans, and it should do the same for its data.Email Anne at anne@anneleggthrive.com to learn more.