Creating Scale and Convenience the Credit Union Way

Shared branching enables credit unions to compete with the largest national banks in a cost-effective, member-friendly manner.


When choosing a financial institution, consumer decision-making is guided largely by perceptions of convenience. The ABA Banking Journal cited that 62% of survey customers chose convenience over rates when deciding on a financial institution. This has significant implications for credit unions as evidenced by a CUES study that found 68% of those surveyed said they chose a bank over a credit union because it was more convenient.

Credit unions address the issue of convenience through a variety of service channels. In recent years credit unions have made significant strides with their online channel, and many participate in an ATM network. However, for members who desire a physical branch presence, credit unions as a whole are not as “convenient” as their competition.

Where are Credit Unions?

Although total credit union branches have increased almost 16 percent in the past three years, 97 % of credit unions have fewer than 10 branches, and 69% only have one branch. Especially as credit unions expand into community and underserved charters, having a branching strategy that accommodates the needs and expectations of current and potential members is critical. The challenge is how to achieve this in a cost-effective manner.

Individual credit unions have not been able to create the scale and level of convenience of many national banks; they cannot afford it. Through cooperation, however, credit unions are able to build up a network that not only rivals the top national banks in branches, but exceeds them in geographic coverage.

How to Compete

Shared branching, a distinctly credit union strategy, allows members to conduct their financial transactions at any participating credit union facility. This shared branching network has developed a presence in 44 states with over 2,200 locations. As the graph below illustrates, the credit union shared branching network ranks among the top ten in total branches and well above the leading credit union, State Employees Credit Union ($13 billion in Raleigh, NC), with 196 branches.

As credit unions of all sizes seek to create greater convenience and scale, shared branching offers a viable strategy to achieve this without the financial implications of building independent branches.

Beyond the total numbers and scale it affords, shared branching provides a number of other benefits to credit unions (e.g. disaster recovery) and members (e.g. convenience and security). To learn more about these shared branching opportunities, please join our webinar, Shared Branching: Enhancing Credit Union Service and Efficiency, brought to you by Callahan & Associates and sponsored by Credit Union Service Corporation.




June 26, 2006


  • Good article, but this is no longer "distinclty a credit union strategy". I read an article recently that indicates at least one banking data processor is offering shared branching to their banks.