MADISON, Wis. – Filene Research Institute’s i3 incubator proposed a mortgage to help buy junior his first house with equity pledged by other relatives, plus a dedicated text message to help prevent member overdrafts, among eight new innovations for credit unions.

i3 said the “Working Together Mortgage” is aimed at helping a first time home buyer obtain an 80/20 mortgage by utilizing the equity from a relative’s home (most likely a parent) pledged as part of the down payment.

“CoverMe” is described as a simple, actionable text message, which i3 said will notify a member that an item has been presented that will overdraw his or her account.

The credit union think tank also proposed: a “Retirement Positioning System” that helps consumers get ready for retirement; the “Student Loan With Benefits,” which will support the student in finding employment and a career in his/her field of interest; and, a “Smarter Gift Card,” which encourages members to save instead of spend.

The other i3 innovations are: “Pick A Dream” goal-based saving and borrowing; “CU Pocket Banker” for personal banking online; and, “Flash Note,” which it said will make mobile payments accessible to members and merchants.

The implications of these open-source ideas are “largely up to the credit union community,” Filene said in its report: Blueprints for Innovation. Filene added each concept may be scalable, malleable, or disposable, but further testing is needed.

Previous i3 innovations include: Prize-Linked Savings to encourage savings; LIFT loans:  software program that allows the credit union to automatically lower interest rates annually for members who make payments on time; the 2 Grand Plan creating a $2,000 emergency savings fund; and “HomeTrak,” which helps homeowners anticipate when big ticket items might need replacing.


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