Credit unions planning their budgets and technology purchases for 2005 should
focus on initiatives that make an immediate impact on member satisfaction and
With the increasing number of members adopting online services, more credit
unions are focusing on ways to make their online channel more marketable. By
2007, TowerGroup estimates that close to 37 percent of all U.S. households will
be registered to bank online – that’s a total of 42.5 million households.
As consumer expectations for online services increase, credit unions must focus
beyond the basic suite of online services. Outlined below are considerations
to keep in mind when shopping for credit union technology tools:
Transforming online bill payment into a bill management tool
Members’ needs have matured beyond the basic online bill pay service.
Today’s tech-savvy members are looking to receive, review and pay their
bills online. To meet this need, credit unions are turning to the more complete
package of Electronic Bill Payment and Presentment (eBPP). With eBPP, payment
information is automatically pre-filled and the member is able to view the details
of the bill online. This leads to greater convenience for the member and alleviates
their concerns of paper invoices delivered via the mail.
The next evolution of online money movement
Members are now expecting to quickly and effortlessly move money online between
their accounts at the credit union and other financial institutions. Also known
as person-to-person (P2P) or account-to-account (A2A) transfer capabilities,
this service enables members to electronically transfer funds via the Automated
Clearing House (ACH) Network. Credit unions may be concerned that outbound transfers
will exceed inbound money transfers. In actuality, data from credit unions shows
the ratio is around 50/50. And because members visit their credit union’s
Web site to initiate transfers, the credit union has more opportunities for
building and maintaining member relationships.
Strengthening online relationships through an integrated financial management
Account aggregation is showing impressive growth and members are realizing the
value of this portfolio management tool. For example, Suncoast Schools Federal
Credit Union in Tampa, Fla., (with $4.2 billion in assets and 343,000 members)
has been offering account aggregation since December 2003. On average, 11 percent
of its online banking users actively use account aggregation and an additional
1,000 members enroll each month.
Increasing member satisfaction through single sign-on access
Consider the various logins and passwords you’re required to remember
to access secured systems. Now think about it from your member’s perspective.
If the member has already been authenticated into one of the credit union’s
systems, why require them to sign on again to another system? A feature like
single sign-on (SSO) is critical to a positive user experience.
Bellco Credit Union based in Greenwood Village, Co. (with $1.5 billion in assets
and 144,000 members) discovered the value of this service by offering a new
SSO interface between their home banking and bill pay solutions. Sandra Sagehorn-Elliott,
vice president of CRM, said, “The number of new bill payment enrollments
we received each month had remained relatively static for about a year. Then
we began offering single sign-on access and enrollment through home banking.
Coupled with a marketing campaign, this caused new enrollments to more than
double. Moreover, those enrollment numbers have remained high.”
Proactive communication with members
An added convenience for a member is access to key information for financial
decision-making. This goal is closer to reality with secured messaging. A secured
messaging service allows secure two-way communication between the credit union
and its members, enabling them to feel comfortable sharing private or sensitive
An alert system allows members to request notifications when designated events
occur. The alerts are established by the member based on a list of events selected
by the credit union, such as account balances falling outside of a designated
threshold, insufficient funds (NSF) activity, or the due date of an important
bill. This added level of convenience enables members to continuously monitor
finances at the credit union.
Member growth and increased efficiency using an online solution
When a prospective member finds an attractive offer on a credit union’s
Web site, it's critical to provide them the tools to take immediate action.
The first step is to become a member. Offering a new account opening service
through the credit union’s Web site enables consumers to apply for membership
24 hours a day, seven days a week. Compliance checks, ID verification, and credit
scoring can all be facilitated electronically. Immediate funding of a new account
can also be completed online through an ACH or credit card transaction. Boeing
Employees Credit Union (BECU) in Seattle, Wash. (with $5 billion in assets and
381,000 members) has seen significant success with its online account opening
tool. BECU has been offering the service since April and is seeing about 10
percent of its new member applications coming through this channel. BECU has
found these new members to be strong online banking users who are more likely
to establish an online service relationship with the credit union.
For more information on the new technology trends highlighted above and how
they can be implemented in your credit union, please contact your corporate
credit union or call Cheryl Harris, national sales director, at (888) 656-4050,
ext. 6027, or visit www.memberstreet.com.