Significant Numbers of Online Members Have Used/Tried Online Loan Applications

A new Survey Consortium study highlights the increasing use of online loan applications by credit union members. This study provides insight into why credit unions need to focus on this important channel.

 
 

Forty percent of online members have either used (31%) or tried to use (9%) an online loan application, according to a new survey by Callahan's Survey Consortium, a shared cost research group. However, these proportions varied greatly by credit unions, demonstrating that some credit unions are more successful in convincing members to use online loan applications. The member comments below further illustrate the importance of this channel to online members:

"I applied for this loan at night after banking hours and found out if I was approved the next morning. The ease and convenience was great."

"Online approval did not work, had to wait for someone to call. By the time someone called we had what we need from another bank."

"Would prefer a faster approval time. Within a few hours...even on a weekend...would be a big incentive for me to use my credit union again. Right now we are looking to buy a new car and I have been investigating other banks to see how quickly we could be approved if we find the car we want."

Most of the online loan applications were fairly recent, with the majority made within the past year (62%), showing the dramatic increase in adoption in a short time. Of the online loan applications made, auto loans (37%) were the most popular, followed by signature/personal loans (29%). Usage of online applications for mortgage (22%) or home equity (12%) is much lower.

The majority of the online loan applications were made with the credit union (80%), but this varied based on the type of loan. Online members were most likely to have used their credit union when making auto (89%) or signature loan applications online (85%), but only 61% of online mortgage applications were made with their credit union.

"I've used the online application for two auto loans and each experience was easy and fast. That's why I stay with my credit union, the customer service is great!"

Given that online loan applications offer credit unions both the opportunity to decrease loan processing costs as well as further strengthen their relationship with online members, credit unions should ensure that their website makes it as easy as possible for members to use their online loan applications. Online members provided a number of ways that credit unions could improve their performance, including providing more information upfront and offering faster approvals.

 

 

 

June 28, 2004


Comments

 
 
 
  • Members will be more willing to use the web application if an instant loan decision can be obtained. Credit unions are missing the point of going online if a decision isn't automated. Members want to know now, if they are approved. With all the resources for automated decisioning that are in the marketplace, there is really no reason to not have it for your members. A disappointed member is "prime meat" for the competition who has the service(s)the member is looking for.
    Anonymous
     
     
     
  • Any credit union wanting to offer online loan application must convince the users of their website for using the online application to apply for loans. Fast response, digital signatures and online documentation and calculators would certainly help achieve this goal.
    Anonymous
     
     
     
  • Any credit union wanting to offer online loan application must convince the users of their website for using the online application to apply for loans. Fast response, digital signatures and online documentation and calculators would certainly help achieve this goal.
    Anonymous