New technologies have revolutionized the way money is used and managed. Rather than making a purchase with cash, check or even plastic, many consumers now pay with their mobile devices. Rather than visiting the local branch of a financial institution to deposit a check, many make remote deposits by sending an image of the check through a mobile phone app.
As people interact differently with their finances, financial institutions have to adapt to remain relevant. And while remaining on top of the latest technology trends can be expensive, it’s not just the game of large, corporate banks. Credit unions, which have long touted their superior customer service as nonprofit member cooperatives, are also holding their own in the quest to remain a force with today’s demanding financial consumers.
“The younger generations want to bank the way they want to bank, not necessarily the way their parents or grandparents did, ” says Patrick La Pine, president and CEO of the League of Southeastern Credit Unions. “There are people in their 20s who have never walked into a branch. Credit unions are understanding that and trying to bring to consumers the types of services they want.”
After launching in October 2014, Apple Pay has become quickly popular, allowing consumers to pay for goods and services directly with their iPhones or iPads. Other mobile payment solutions include Google Wallet and the Paypal mobile app, and forecasters predict that mobile payment solutions will become more widespread in the coming year. Alabama Credit Union (ACU), based in Tuscaloosa, is in the process of getting its credit and debit cards in the Apple Pay program. “We are in queue to become active in the Apple Pay program, with one of the larger payment processors as our gateway to that network, and we expect to see that in the very near weeks ahead, ” says Kayce Bell, ACU’s chief operating officer. “As with many financial institutions our size, we use a cooperative platform provider to link us into new networks. Apple Pay, of course, was a simple decision to make; if there were any concerns, it probably centered around the number of merchants who accept AP. Interestingly, there are many more merchants now active than Apple Pay even shows on their official list, so we’re excited that the acceptability is probably stronger sooner than was anticipated.”
The Army Aviation Center Federal Credit Union (AACFCU), based in Daleville, is also in the process of adding its card base to Apple Pay, and leaders are considering other mobile wallets as well, says Thomas Struan, senior vice president of information services. “What matters most to us at AACFCU is providing secure and quality payment methods to our members, ” Struan says. “New channels will always emerge, but at the forefront is providing the best and, most importantly, secure service to our members.”
Digitizing Member Services
In addition to making it simple for members to make purchases with their phones, credit unions across the state have introduced a variety of options for digitizing typical services. For instance, for several years, ACU has had the capability to instantly issue debit cards in its branches and has offered a mobile app to accompany its online banking system. In 2013, ACU launched ACUziposit, a deposit capture product that pairs with a mobile app or a desktop scanner unit, “so it works for consumers as well as small businesses who might need to deposit multiple items in one transaction and would prefer to use desktop equipment, ” Bell says.
AACFCU recently developed and implemented a streamlined receipts process using iPad-based technologies, Struan says. When members conduct business in a branch, they can opt for a paper transaction receipt, or they can have their receipts emailed to them to conserve paper. “The iPad and other tablets have transformed the transaction paradigm for all financial institutions, and we see that as a growing service delivery channel, ” Struan says. “AACFCU will be rolling out a new web- and mobile-based lending platform in the coming months, as well as an online membership application system.”
High Touch Service
While credit unions continue to adopt evolving high-tech options, they find that their ongoing attention to personal service makes a difference for their members. “One of our most popular programs is no more high-tech than e-mail, ” Bell says. Because so many members seem to have questions or issues after hours, ACU offers a link to an after-hours email address, [email protected], which is monitored at nights and on weekends by Bell, ACU President Steve Swofford and the manager of ACU’s Member Care Center. On many occasions, one of the ACU representatives has driven back to the office or logged in remotely to assist with a card transaction that was inexplicably declined while a member was traveling, for instance.
“We can’t fix every problem that gets reported to us, but we can have a personal and custom, unscripted conversation with our members who are distressed about a problem, ” Bell says. “Between the three of us, we answer dozens of Listeners e-mails in a weekend. People are genuinely surprised to get a fast response from the credit union president or COO. Then, our Member Care Center follows up as soon as we reopen for business. So it’s not high-tech, but it does demonstrate our business model of quality personal service.”
Another way of showing high-touch service is through personal phone interactions. Rather than adopting one of the widely used call delivery systems, some credit unions continue to employ professionals to answer calls on site. For instance, instead of using an automated phone tree, ACU relies on customer service representatives in its Member Care Center to answer phones during business hours and uses a third-party answering service on evenings and weekends. More than 93 percent of the credit union’s calls never have to be transferred away from the person who answers the phone, Bell says.
Alabama-based credit unions are also finding ways to make their services easily accessible to members wherever they are. For instance, credit unions have long provided automobile financing by partnering with car dealerships, allowing members to obtain credit union financing at the dealership when purchasing their vehicles, says Bobby Michael, president and CEO of AACFCU. Now, as the economy rebounds, “We are seeing the need for that convenience with motorcycle, boat and RV financing, ” Michael says. As a result, AACFCU is implementing a point-of-sale lending program for non-automobile dealers, which is scheduled to be in place by April 2015.
As consumers conduct more financial business remotely, some financial organizations are reducing the number of branches they operate. But many Alabama-based credit unions continue to expand into new branches.
“Branch locations are important, because they help get the credit union noticed, and they give our members a place to visit us when something occurs that they need face-to-face contact, ” says AACFCU’s Michael.
Some of those branches are in unique locations. For instance, ACU operates two branches behind the gate at the Mercedes-Benz plant in Vance, and a “rolling branch” with a lobby, teller
window and ATM, which is used at community events and factory locations.
However, even with the same number or more branches in operation, some credit unions are reducing the number of employees working in those branches. “Because of members using more self-serve products such as online banking, smartphone access, and mobile deposit capture, we are having less and less transactions being performed inside the walls of our branches each year, ” Michael says. “Therefore less staffing is needed in branch.”
Instead of extra staff members, many credit unions are employing self-service kiosks, where members can conduct business themselves. For instance, a new branch of Birmingham-based Jefferson Credit Union recently opened with a number of self-serve kiosks, La Pine says.
Regardless of how many staff members are working in each branch, credit union leaders say they continue to revisit their needs and adjust staffing, technology and branch configurations as needed. “We believe in extremely high-quality personal service, and we know our members often like to deal with one person as much as possible, ” Bell says. “So, we work hard at building that culture of service, and product suggestions to solve problems are a key piece of that. Whether our offices are outfitted with dialog stations or traditional teller counters, we expect to provide our members with meaningful assistance in managing and meeting their financial goals.”
Nancy Mann Jackson and Tim Skipper are freelancers for Business Alabama. She is based in Huntsville and he in Dothan.
text by nancy mann jackson • photo by tim skipper