RANCHO-CUCAMONGA, Calif.—Todd Clark grew up knowing more about credit unions than banks, having opened a share draft account when he was 12 years old.
“I guess I was a little bit different than a lot of consumers today—I didn’t know how a bank worked until I was in my late teens,” the new president and CEO of CO-OP Financial Services told CUToday.info. “But I knew about credit unions when I was very young. So I have just about always been part of movement, whether I was actively promoting it or participating in it.”
Clark succeeded Stan Hollen when the former CO-OP leader retired at the end of June. Prior to CO-OP, Clark served as SVP/head of STAR Network and debit processing for First Data Corporation. Prior to the First Data assignment, Clark was an executive with Cardtronics, Inc., and also served in a prior capacity at First Data from 1991 to 2012.
Clark spoke with CUToday.info about his past as well as credit unions’, in addition to the role CO-OP will continue to look to play in the credit union movement.
CUToday.info: You spoke of an early experience with credit unions?
Todd Clark: Yes. As I said, I had a credit union account when I was 12, so I learned all about CUs at a young age. I have been a member of several credit unions since, and I have financed many cars from them and I have used their services.
CUToday.info: You knew CUs at a young age, and today, heading perhaps the largest CUSO supporting credit unions, how do you see the future for the movement?
Clark: In today’s world credit unions are perfectly positioned to serve Millennials and this whole notion of a shared economy. Because, effectively, that is what a credit union is—people getting together to help each other move their financial situations forward.
Clearly, there will continue to be more consolidation within the industry. The regulatory environment is getting tougher on credit unions, as well as on banks. So economies of scale will help credit unions survive and thrive. And there will be a greater push toward the use of technology.
CUToday.info: How does CO-OP fit into that future?
Clark: CO-OP Financial Services is, and should be, a technology provider for credit unions, which includes payments, of course. We are helping them do the things that they won’t be able to do on their own. Again, getting back to the importance of economies of scale.
Look at some of the big banks, they can throw thousands of people at a problem and solve it. Most of CO-OP’s clients don’t even have 50 people to spare to solve an issue. So coming together in a cooperative sense and helping credit unions solve problems is what we do.
CUToday.info: In addition to being in the technology and payments space, CO-OP has also sought to be a leader in the thought leadership space—for example, with the THINK Conference. Do you see thought leadership as a continuing focus for CO-OP?
Clark: Yes, very much. Sure, we have a focus on payments and technology, but in the last year we have branched out in the last few years in the area of call center support, we are providing lending support, and we have added a variety of new products.
I think you will see us continue to explore on the periphery of the products that we currently have. I don’t think you will see us jump out and do something completely random. We will grow out of the products we currently have.
As far as our THINK Conference, we will continue that. It’s been incredibly successful and we anticipate it will become even bigger and better.
CUToday.info: You said CO-OP, for the most part, will innovate within its current product lanes and not do something unpredictable. How do you see your selection as president of CO-OP, a predictable choice? And what do you think you bring to the table?
Clark: A number of things, and I am not sure it’s right that I am the one who describes what I bring to CO-OP. But one thing is that I have 25 years in the payments industry, and I have been in big and small organizations. I have been an entrepreneur. I worked in the biggest payments company in the world, First Data, in my last role. So I have been all over the industry and my breadth of knowledge is wide. Stan Hollen also said our board felt my personality is well suited to the role.
CUToday.info: Speaking of your board of directors, what have they charged you with doing?
Clark: One thing they have emphasized is that CO-OP is certainly not broken. We want to continue to be a leader in the technology space, and we want new and creative products.
CUToday.info: You currently live in Atlanta, will you remain there? And how do you view the demands of leading CO-OP and having to travel with your headquarters located in California?
Clark: Atlanta is considered pretty much the payments capital of the U.S., and we have a good-size office here, where a lot of our technology skill resides. I will work out of the Atlanta area office, and I will also spend a lot of time in California and Detroit. No matter where I live, this job is not a one-city, one-state job. It is a nationwide job and the hub here in Atlanta will serve me well.
CUToday.info: You have a strong background in payments. How do you see credit unions’ position in payments and technology?
Clark: For the most part, credit unions are fairly well positioned in payments and technology. I think it is fair to say that credit unions have always been early adopters of technology. And I think they have an advantage over banks, which have just begun in recent years to focus on branch reduction and how to serve their customers with fewer offices. Credit unions have been living that world for a very long time. Credit unions have been forced to embrace technology and be early adopters. At CO-OP, we will continue to lead that charge.
CUToday.info: What is your view on the future of debit and even credit card interchange, which some analysts have said may soon come under fire as did debit interchange years ago?
Clark: It’s probably fair to say that the retailers have become accustomed to the change in debit interchange, which is slowly on its path downward. So, obviously, credit becomes a focus. Interchange is what Walmart Pay is all about. You will see more and more merchants trying to convert people to their own payments programs. It’s an opportunity for them not only to create loyalty with their customers, but also reduce the fees they pay to MasterCard and Visa.
CUToday.info: With interchange decreasing, what must credit unions do to address the potential decline in revenue? How long can CUs make up for the decline in the average swipe fee by increasing volume?
Clark: What credit unions will have to do is vastly different from what banks will have to do. Credit unions have an advantage in not having to focus on every single penny. My guess, and hope, is that interchange will fall slowly enough so that everyone can adjust in kind.