Using our CUSO to support member needs

Sitting across the desk from our CEO, all I remember hearing was, “Andy, you are the new Vice President of the CUSO. You need to spend all day, every day making sure our CUSO makes us money.” I suppose this is where my CUSO Project began. Over the last 4 years, I have realized the CUSO will play an integral part in reaching our goal of providing 100% of the credit union’s annual operational budget from non-interest income. As of today, we are at 60%.

Though credit unions are subject to interest rate risk, we can minimize this risk in several ways. One way is by increasing non-interest income through various revenue streams. At Kemba, we have added 6 new products since I began my tenure as VP. Much like any good investment portfolio, I have tried to diversify our products to minimize interest rate risk even more.

Many of our CUSO products derived from member requests. I would often hear, “You have my checking account and auto loan; why can’t you do my auto insurance too?” or “I want to set up a Trust account at Kemba. I know you can take care of the financials, but where can I find a lawyer to draw up the legal documents?” Our response to these questions is always the same: We find the best way to serve our members. Since our members are looking to simplify their financial lives by having everything under one roof, Kemba is striving to become a one-stop shop. If we succeed, we can and will become their primary financial institution.

With Kemba becoming members’ primary financial institution in a non-traditional way, the result is win-win-win. Kemba becomes sustainable, remains relevant, and provides stellar member service.  

Credit Unions with a diversity of revenue streams are sustainable; thus, they are better able to endure interest rate changes. For example, everyone who owns a car and/or a house is required to carry insurance. Although, insurance rates may be affected by economic changes, the need for insurance is not.

Members have a need for the products we offer through our CUSO; fulfilling their needs keeps us relevant in the ever-changing financial industry. If we do not provide the products they need, they will find someone else who will. 

Keeping with the credit union movement roots of “people helping people,” it is our responsibility to provide our members with the best possible service. I believe this call goes far beyond traditional savings, checking, and loan rates. 

In order to achieve my goals for the CUSO, I needed a way to inform the membership and fast. I had the products and the people in place, but the sales culture within the branch staff needed work. The lack of product knowledge was a big deterrent for branch staff to cross-sell. What I have done is taken the fear of not knowing and used it as a motivator to increase referrals to our CUSO partners. This year, it’s all about the referral. Ask simple questions and refer the member to an expert. Branch staff are not measured by the number of cross-sells but by the number of referrals. Additionally, I worked with the VP and AVP of Branch Operations to include CUSO referrals as part of each branch manager’s monthly goals. Needless to say, we are crushing our year over year referral totals. Through July 2014, we have more than doubled the number of referrals to the CUSO compared to this time last year. We are also very excited to see a 36% increase in the number of employees making referrals this year.

The CUSO products are also excellent options for our Select Employer Groups (SEGs). Last year, our insurance agency met with a SEG of 15-years to discuss the company medical plan as well as its commercial insurance policy. We were able to assist them in lowering overall costs of each plan and provide them additional value-added services within their insurance programs. Our great service led to a shot at their company 401k plan. We were able to provide better investment options at lower costs as their plan had not been reviewed in 10 years. We also offered one-on-one employee enrollments, a foreign concept for them. Insurance and 401k plans are necessary for most businesses, and, now, our over 700 SEGs can take advantage of Kemba’s quality products, affordable prices, and excellent service. 

I work daily to make my CUSO project successful—providing excellent service to members and more non-interest income to Kemba.

Andy Dunn