Updated: Mar 20, 2020
As 327 million Americans are responding to Covid19, the country is experiencing;
school district shutdowns, conference cancellations, events postponed, travel restrictions as well as retail and restaurants closing or reducing operations significantly. While these are actions that will save lives and ideally
"flatten the curve ", the next patient who is not feeling so good is the economy.
When the economy doesn't feel well, as we saw in 2008, the effects are widespread.
Here are three actions your credit union can do today to help your members navigate potential choppy economy waters.
Action 1: Identify potentially impacted member segments
Members who work in Hospitality (hotels, airlines, events) and service industries (restaurants, bars, etc.) will be the most impacted. Identifying those members may not be easy, especially credit unions with limited data analytics. The following is a basic method.
Basic method: Search deposit data
Search for deposit behavior that is consistent to that of a paycheck - frequency and amount and change.
Search for large Employer names (i.e., Hilton/Hyatt)
Identify look-alike behavior
Action 2: Analyze the findings
When target(s) have been identified, what do they look like?
How many are impacted?
What is the demographic data?
What is the level of potential impact if paycheck decreases?
What is the relationship with the credit union?
Level of savings?
Level of debt?
Action 3: Create financial solutions to their problems
In times of crisis, credit unions have taken fantastic measures to help their members; this is no exception.
Recent examples include:
skip a loan payment (auto/credit card)
mortgage refinance to help with cashflow
waive late fees
start financial counseling and outreach before adverse action as occurred.