MALVERN, Penn.—At a former job where he worked with commercial banks, Kris Frantzen recalls hearing people say things such as, “Credit unions aren’t as tech-savvy as banks. They’re more into Main Street relationships, where members come into the branch.”
That wasn’t all. Frantzen, vice president of project management at technology provider Temenos here, would hear other people suggest the cooperatives didn’t just lag the biggest commercial banks on technology, but even community banks when it came to offerings.
“But that’s not the case,” he notes now.
Indeed, he said its banks that now have envious of the technology offerings available from many credit unions, which he said are earn admiration for their ability to combine high-tech with Main Street values.
Frantzen’s comments are part of a series in CUToday.info on “fake news,” that is perceptions and misconceptions about and within credit unions that need to be addressed.
As an example, he cites Partners Federal Credit Union, Burbank, Calif., which serves employees and cast members of the Walt Disney Co.
A Different View on Mobile
“Mobile” technology has a slightly different connotation for Partners. In wanting to serve Disney cast members who may not be able to get to a branch, a mobile branch goes to them, instead.
Kris Frantzen
Partners FCU is an example of a credit union that has shown it can be nimble and creative, according to Frantzen. Besides serving the actors playing Mickey and Goofy and the like, “their membership spans creative designers at Pixar all the way to the people who clean rooms in the resorts.” And that requires a pretty intensive analysis of data and other factors.
Another example is First Technology Federal Credit Union, based in California’s Silicon Valley. In its case, it is the credit union that wants Temenos to be nimble, asking for a platform it can easily plug in to.
“A lifelong journey,” he says of the credit union’s philosophy. “That’s really the key to meeting member expectations.”
A Journey of Separation
That journey is part of what separates credit unions from banks, Frantzen said. A recent survey of credit union and bank chief executives found that bank CEOs tended to focus on efficiency, while credit union chief executives focused on service delivery, according to Frantzen. Technology is much more ingrained into that kind of worldview at credit unions.
For instance, a bank’s might be willing to accept an 80% fallout rate on a marketing campaign, making its return on the 20 percent and ignoring the rest, he said.
“That would be blasphemous in the credit union space,” Frantzen suggested, as CUs would be far more likely to reach out to those who were declined for a loan or who failed to finish making an application.
The technology available to credit unions “is just as good as the technology available to banks,” Frantzen stated. And instead of banks, where credit unions should really be focused, he said, is on the Facebooks, Amazons and Googles of the world for their technology cues.
The Journey of the Member
A credit union’s focus should be “on the journey of the member. That’s how you have to deliver products. Do it through technology. Credit unions have always thought that way.”
The traditional face-to-face approach, where a credit union officer knows everything about a member, has changed a little in recent years, he says. But it is the foundation for a credit union’s digital experience.
Temenos has between 350-400 credit union clients using its lifecycle management suite, which includes service, collection and recovery suites. Frantzen said 70% of all credit unions with assets of more than $1 billion use at least one of the lifecycle management suites,
—Mark Fogarty