The ‘Union’ Part of ‘Credit Union’ Is Alive and Well

Many of us think of Seth Godin as a man of big ideas. When I heard the author and former .com business executive present the opening keynote last week at CUES Supplier member CO-OP Financial Services’ TH!NK conference in Miami, he said that in the phrase “credit union,” “union” is the important part. Then he asked, “What does it mean to be a union?”

That single comment set me to watching for examples of the “union” part of credit union in action during my time in Miami. I was not disappointed. Here are five of many that I observed:

1. CUSO operations. CO-OP Financial Services is a 1,600-employee credit union service organization based in Rancho Cucamonga, California. The CUSO’s president/CEO, Todd Clark, spoke about how credit unions come together as both owners and customers of the for-profit company. Staff members from member credit unions participate in “co-creation councils” that inform technology development and their executives serve on the CUSO’s board. As with many CUSOs, that “union” of credit unions generates power. “Your budgets can’t possibly match what we can do as a group,” Clark said from the stage, noting that CO-OP Financial Services is a top customer of the large corporations FIS, Jacksonville, Florida, and First Data, Atlanta. It also has the ability to touch 60 million credit union members. In contrast, Chase bank has 51 million customers. (Read more about benefits of working with CUSOs both for economy of scale and added revenue in this special report from CU Management.)
2. CUSO governance. The event also included CO-OP Financial Services’ annual meeting. Annual meetings are often thought of as dry affairs—but they’re also “union” in action. At last week’s meeting, the owners approved a bylaws update allowing remote meeting attendance for the CUSO’s directors, ratified newly nominated board members, and recognized Patsy Van Ouwerkerk, CCE, a past chair of CUES, with the organization’s Founders Award for her service to the CUSO and the industry. (Don’t miss the opportunity to nominate credit union CEOs for CUES Outstanding Chief Executive award, other executives for the Exceptional Leader award and board members for the Distinguished Director award.)
3. Shared branching. Van Ouwerkerk was a key player in getting shared branching off the ground. Today’s network of more than 5,600 shared locations allows members to belong to one credit union but actually do their financial business at a participating branch of another. During her acceptance of the award, Van Ouwerkerk underscored the faith that she and her colleagues had in the unity of credit unions back in the day: “We never figured it (shared branching) wouldn’t work,” she said. “We just had to figure out how.” Today shared branching stands as a prime example of credit unions leveraging the “union” part of their names. Notably, the backbone connection among the core systems of credit unions that participate in shared branching provides a way to share additional technology and services.
4. Sharing information. Never has it been clearer to me than last week that credit unions offering credit and debit cards to members have an intricate puzzle to put together in terms of what they’ll do in-house vs. what they’ll outsource—and to which vendor. I spent a lot of time with a CU executive from a credit union in Western New York who was gathering information about the options as she spoke with peers. Each conversation added to her knowledge. The dialogues she was having reminded me a lot of how CUES members participating in CUES Net regularly help each other clarify their direction in managing shared concerns. The “union” of credit unions is strengthened by this sharing.
5. Credit unions helping credit unions. At the event’s closing reception, I witnessed a unifying exchange between executives of two credit unions located states away who were experiencing some challenges resulting from having similar names. Apparently, auto dealers in the indirect program of one of the CUs were making demanding calls to the credit union with the similar name states away. The executive from the CU with the indirect program said she would get in touch with the dealers and clarify matters. Credit unions helping credit unions—the union part gets things done.

One of the inspirational speakers at TH!NK, Spanish-American chef José Andrés, led a movement to feed people after Hurricane Maria hit Puerto Rico in 2017. Asked how he managed to do so much, he spoke of unity: “You are only as good as the people next to you. With trust and confidence in each other, we can feed the people.” 

I think this parallel statement applies: With trust and confidence in each other in the credit union world, we can help people improve their financial lives.

Lisa Hochgraf is a senior editor of CUES.