Park Community Credit Union ($695.0M, Louisville, KY) is combining bricks and mortar with virtual reality to improve service, membership, and business. In January, Park Community became the first credit union in the commonwealth to deploy interactive teller machines (ITMs).
The ITM-equipped branch is staffed remotely by tellers as comfortable on camera as they are with numbers and people. Branch staff is available on-site to help members interact with on-screen tellers and interview users about their virtual experience as they leave.
CU QUICK FACTS
PARK COMMUNITY Credit Union
data as of 09.30.14
HQ: Louisville, KY
12-MO SHARE GROWTH: 7.79%
12-MO LOAN GROWTH: 24.93%
So far, so good, says president/CEO Jim Spradlin. Only one member in the first few days refused to use the machines and sought an in-the-flesh teller at another branch, and Spradlin says that’s OK.
“We believe brick-and-mortar is still important to the future of credit unions, but we also believe the expectation of members will change based on the experience they have with the technology,” he says. “They want the convenience of the electronic experience without losing the personal touch.”
In fact, the virtual machines have allowed the credit union to add 19 operating hours a week at its drive-thrus by staying open as late as 8 p.m. on weeknights. During those extended hours, two to three employees can staff the machines from a remote center, instead of the minimum of two needed at each branch to keep a drive-thru operating.
By The Numbers
The ITM initiative is part of the credit union’s multi-year plan that began in 2013 with facilities growth planning, continued in 2014 following approval of a state charter that sharply expanded its geographic footprint, and continues this year with the opening of its new ITM-equipped branch and plans to open another. Park Community also plans to relocate a third credit union this year and complete its new headquarters.
Spradlin says operating costs at its 13 branches in three states have grown approximately 7%, roughly $1.2 million, per year since 2011. Nearly half of those costs are pay and benefits, so the ITM deployments should slow that trajectory while increasing overall branch efficiency.
The credit union has approximately 200 employees, the same ratio of employee per members as its peer group, but Spradlin says he expects that to change.
“The ITMs will be able to handle the transactional side of branches with fewer personnel,” he says. “That will allow us to place an emphasis in the branches on the financial services side to help generate more loans and therefore income.”
A Little Help From Friends
Park Community wanted to see firsthand how the ITMs work before it made the plunge. It found an accommodating mentor not too far away in Wright-Patt Credit Union ($2.9B, Beavercreek, OH).
“We got to see all the technology in action,” says Lisa Bannon, Park Community’s senior vice president for support operations. “We also got to talk to them about the whole process — from the financial standpoint, to how people move around the office, to how their members have reacted to the ITMs.”
The Kentuckians left Dayton with ideas about how to deploy the machines in their own branches. “It was extremely helpful,” Bannon says. “It gave us a chance to envision how we want our ITMs to look to members.”
Telegenic Tellers Toss The Tube
By using one pool of tellers to function at multiple branches, the credit union also can cover the busiest time at each branch and minimize idle time, says Bridgett Bosse, the ITM project lead at Park Community. Also, the credit union expects eliminating the pneumatic tube system in the drive-thru will decrease individual transaction times.
To manage the ITM platform, the credit union created a separate department staffed by four people. Selecting those ITM staffers took a new approach as well.
“Along with the typical interview questions, we thought we would talk to them on FaceTime, to get a better idea of how they would be while interacting with a member on a screen,” Bannon says.
ITM staff needs to be as adept at using new technology as talking about it, so the credit union also conducts training on camera. Ease of use, in fact, helped drive the decision on which ITMs to buy. Ease of implementation was another.
“We chose NCR’s because the machines were able to fully integrate with our core processor [Symitar] and were able to deliver a complete interpersonal experience,” Spradlin says.
The credit union wanted more than a member-driven enhanced ATM, but integrating the machines was the biggest challenge, says Todd Richardson, Park Community’s senior vice president for IT. Given the number of parties involved — including core, card, and check processors — having cross-vendor cooperation and a virtualized server/storage environment already in place helped make it all work.
The credit union chose the site of the credit union’s first ITM-equipped branch because of its location in a neighborhood popular with young professionals. The ITMs also are a natural fit with the credit union’s commitment to serving members across all channels — existing and emerging.
Spradlin says Park Community will continue to deploy the virtual tellers in any new branches and will consider re-tooling existing branches depending on the machines’ success.
“We’re also reviewing the feasibility of stand-alone facilities for ITMs as a way to reach members and target markets where we don’t currently have a branch,” the credit union CEO says.