In the Nov. 26 Credit Union Journal I shared five best practices we have developed at SAFE Credit Union. Below you'll find the second half of this Top 10 list.
6. Mystery shop your front-line staff. We use an outside vendor to mystery shop our branches and those of our biggest competitors, Wells Fargo, BaofA, Chase and the two largest credit unions in our service area. The shoppers are members. They shop our branch and then shop the nearest branch of the other institutions we picked as our competitors.
We measure the look and feel of the branch; we measure whether there is a greeter and whether the greeter makes eye contact and extends greeting to all who enter the branch. We measure whether the employee greets the member by name; we measure how long the member waited; did the employee offer some new service or some other way for the member to improve their financial well-being; did the employee follow up on any open service issues and did the employee thank the member for their membership?
Mystery shop scores are part of the employee evaluation and the branch manager and assistant managers evals. The combined scores from mystery shops and surveys of members who use our branches, call center and other channels result in a members satisfaction index that is part of all managements evaluation.
7. Know your competition. We use Peer to Peer from Callahan's and a banking database to get data on all of the financial institutions that serve our area. We know where every branch is in our area and who owns it. We know the deposit base of every institution in our area and we know who is growing and who is not. We review all of their key statistics versus our own and therefore we have a way to measure relative performance for all of our competition.
Our data has allowed us to predict with 95%-plus accuracy who is having problems and who is having success. We are never surprised about failures in our area, because we know our competition. We also track all of their share and loan rates and fees. We know their pricing practices and because we know their statistics we can accurately infer why they price the way they do.
Reasons To Go Community
8. Go Community. When SAFE lost our primary sponsor, the US Air Force at McClellan AFB, we became part of a long-term trend where credit unions have lost their sponsor and adopted a community field of membership.
Make no mistake, it is much more difficult to compete as a community credit union. A sponsor gives the credit union a field of membership that is protected, subsidized and uniform. It makes marketing easier, it lowers operating expenses and it makes governance easier, because members know each other and recognize the credit union as part of the their workplace.
But a community field of membership offers a lot of benefits that compensate and in most cases more than offset the disadvantages. A community credit union provides more diversity in membership and therefore lowers the risk that comes when a sponsor closes (in our case) or otherwise ends the relationship.
At SAFE we have created a community banking group that presents financial literacy classes in the workplace (and the classroom) as an employee benefit. That opens the door for the credit union to meet with employees and develop a win-win relationship with the employer.
SAFE spends a large portion (20%) of our marketing budget supporting community groups and events in return for access to their members. SAFE is one of the biggest supporters of community organizations (per the Sacramento Business Journal) for our size. We generate more than 2,000 new members per year directly from our community outreach activities.
9. SAFE is a big believer in small business. Sacramento's largest employer is government, with one out of four jobs in our area with state, federal or local government. Almost all of the rest of the jobs are with small businesses that have fewer than 100 employees.
SAFE has a small business services division that serves 1,500 small business. We have another 1,500 members who own small businesses that we do not yet serve. SAFE was the #3 volume SBA lender by number of loans in our SBA region last year. SAFE's loans average about $75,000 so we are lending to the micro businesses with less than 10 employees. Their needs are very similar to those of our natural-person members.
A community credit union should, in our opinion, offer business services. Small businesses are the biggest creators of wealth and jobs in almost every community. If you serve the business you can also get the business owners accounts and those of the employees. The spreads on business loans and business deposits are larger than those on retail accounts.
SAFE is part owner of the MBL business CUSO so that we have the shared resource of the CUSO to support our own staff and therefore lower our costs and increase the level of service we can provide to our business owners. SAFE also partners with Intuit to provide on line services to our business owners.
Mobile To Surge
10. Go Mobile! The fastest growing service at SAFE the last ten years has been debit card transactions. But we are confident and positive that mobile transactions will grow faster than debit and that the smartphone will become our members primary delivery channel for services.
The debit and credit card functions will quickly move to the smart phone. We now provide members with alerts, balance inquiries and balance transfers between accounts on the mobile phone. We are just starting remote deposit capture on the mobile phone. We have had a great deal of member requests to add bill payer to our mobile phone and will do that this year as well.
The combination of home banking, alerts, bill payer and transactions will make the smart phone a mobile branch for most members.
We are positioning SAFE so that we can be there when the members want the service. We are offering new services as quickly as we can and we are offering them without charge so that members move to the mobile phone as their preferred way to access SAFE.
Henry Wirz is CEO of SAFE Credit Union, N. Highlands, Calif.