By John Belty
I have recently read articles about the inability of CUs to move beyond 6 percent of industry assets, how CUs should be more like banks to compete with banks, etc. I believe these authors and anyone who agrees with them have already missed or are missing the boat. The current economic crisis is the biggest marketing/expansion opportunity presented to credit unions in the last 50 years and we are sitting back and watching it sail by.
"Huh? What did he just say?" you might be asking. "My credit union grew this year; we had a great year!" These could be very typical responses to my statement, but let's look at the evidence.
Currently banks are the favorite punching bag of politicians; public opinion of banks is lower than it has ever been; and financial gurus are recommending credit unions on TV, radio and print. Who is not talking to the public about the benefits of credit unions? The credit unions!
Being the inquiring mind, I asked why, and was told, "we can't really do that; the banks have more lobbyists and the ear of the politicians." Really? The banking industry has handed CUs a big stick, stuck their chin out, and credit unions are not going to whack them in the head?
Last year, your credit union may have had a great year. How much better could it have been if our industry started whacking the banking piñata on the airwaves, print and any other media format on a regular basis? Instead, our publications put out articles about competing with banks by giving up our favored tax status, or changing charters? This is crazy talk! Why would any credit union want to become just another financial choice when its uniqueness allows it to make a real difference for the membership?
The public is desperately seeking, and needs, an advocate to help them wade through the complicated financial environment. Now is the time to stand up, proclaim we are a better choice than the banks, and tell the public why. Credit unions would have lines out the doors if it weren't for the lack of public knowledge about credit union advantages.
Why were credit unions created in the first place? Answer: to serve the underserved.
It's not that different today. In the 1930s, the banking system was a mess and not meeting the needs of the people. Credit unions were created. Flash forward to 2009: The banking system is definitely a mess and banks are definitely not operating for the benefit of the people. They cannot by their design.
The difference between now and then is an overserved population. Most American households have a "grab bag" full of car loans, credit cards and various accounts from multiple financial institutions. One of those institutions may even be a credit union. Is this the best we can do to improve these members' financial success?
Credit unions must look outside the traditional financial services framework created by the banks, think outside the box, and develop products and programs to benefit today's member. Remember, the one with the "grab bag" full of stuff? They should be our focus. Not, how can the credit union be "more like the banks." Once credit unions begin to truly help consumers in this manner, the banks won't have a chance.
John Belty is a branch manager for $760 million TTCU, Tulsa, Okla.