ST. LOUIS—Chuck Fagan emphasized the importance of scale to succeed—not only for credit unions but for PSCU as well, during the CUSO’s 2018 Member Forum.
The PSCU president and CEO spoke about how the company has been focused on gaining scale in the past few years in an effort to not only continue to deliver cost-effective services and products to its member owners, but also to help credit unions compete into the future.
Fagan pointed to the partnership with Jack Henry & Associates the CUSO announced last year, and the formation of its new company Lumin Digtial. Announced at the Forum Tuesday, Lumin Digital is a company aimed at “redefining digital banking” for credit unions, Fagan explained. The cloud-based digital banking platform has been built using market-leading technology, and will provide members of PSCU credit unions with a tightly integrated and customized experience that rivals the offerings available from the big banks, Fagan said.
“It’s all about scale,” said Fagan, who noted that the Jack Henry agreement has taken PSCU from 2.3 billion transactions a year to 4.4 billion. “And from 21 million accounts to 33 million accounts. Also, the proceeds of the Jack Henry deal will become our first permanent capital in the company’s history. That gives us a lot of flexibility.”
Greater scale also leads to greater product development as well as access to much larger amounts of transaction data that is extremely valuable to credit unions and all retail companies today, said Fagan.
“We can look at much more data now, learn about purchasing trends…This is not our data, this is your data and it can benefit you,” Fagan told the audience.
What will also benefit credit unions, said Fagan, is the formation of Lumin Digital, which will help credit unions compete in a market that is quickly becoming dependent on mobile applications—and these applications working seamlessly and easily for members across all mobile devices.
Fagan said that Lumin Digital will allow members to do nearly all of their banking through the digital channel, with seamless integration to PSCU credit/debit card services and call center support. He said the platform will increase member engagement through a proprietary engagement model that provides highly targeted, actionable, and unique digital interactions to help credit unions create a truly personalized journey and connected relationship.
“Research shows that Americans spend 2.3 hours on their phones each day, so if this is how more people are interacting with us, we have to move our business models towards this,” Fagan said.
Fagan added that PSCU is focused on five key areas this year: scale, developing staff, data, fraud and security, and mobile/digital.
“Mobile/digital is getting a big slice of our investment pie,” said Fagan. “Everything is headed in that direction. And it’s not just the younger demographics. Think about how Amazon has become such a significant player in such a short amount of time. That’s where people are shopping, let’s make sure we are all going where our members are going.”