In the current environment of tighter margins and slowing member growth, successful credit unions are rethinking their approach to the new account opening process. By improving this process, credit unions can realize three main benefits: creating a positive first impression with members, increasing products and relationships with those members, and reducing operating expenses.
Creating A Positive First Impression
An efficient new account opening process is vital for credit unions, for the
experience – good or bad – informs the new member’s impression
of the credit union. An efficient and customer friendly experience will forge
a lasting relationship and set the credit union apart from the competition.
In contrast, an inefficient or overly-cumbersome experience at the outset can
taint their views of the rest of the credit union.
Increasing Member Relationships
An efficient, well-designed new account process can also help credit unions
to deepen their member relationships. The first six months in a new relationship
are a “make or break’ period for member loyalty – and members
with more products and services are less likely to leave the credit union.
New solutions for account opening integrate risk decisioning technology as part of the process, and can recommend products or loans based on the member’s information and credit history. Additional products and services such as debit cards, credit cards and checking can be cross sold instantly.
Reducing Operational Expenses
An efficient new account opening process can also help reduce credit union operating
expenses. Many credit unions currently utilize inefficient processes dependent
on lots of paperwork, manual staff verification and data entry, and running
checks through multiple databases (each with its own interface). Additionally,
the processes and paperwork can be different depending on where and how a member
joins. It is not uncommon to have one set of forms for in-branch applications,
another process for those who fill out an online form, a different set for those
taken in the call center, and yet another set of membership applications to
take to SEGs!
New technologies can allow for a credit union to streamline and standardize the process across the credit union. From a single user interface, account opening systems can interface with identity and credit verification databases to enable the credit union to meet both Patriot Act requirements as well as potential fraud. This is done on a fairly automated basis, enabling a faster turnaround and tighter control compared to traditional paper based systems – and without as much employee involvement and the potential for human error that goes with it. Digital Credit Union ($2.8 billion, Marlboro MA) made the switch to an enterprise account opening solution at the beginning of the year. The credit union staff now only has to enter information once and the system pulls credit, OFAC, and fraud reports automatically, cutting the staff time required in half.