Rise of the Credit Union
“In the year to April 2017, credit union memberships rose 4.8% faster than the 3.8% pace set in the year to April 2016, and the fastest pace in in the modern credit union era,” says CUNA Mutual Group, in a new study entitled “2017 Credit Union Report.”
As the CUNA report notes, credit unions are growing for a variety of reasons, but a renewed and targeted focus on customer service is a big priority for the industry. “Credit unions have been growing primarily because they have excelled at creating a member centric culture,” says Chris Griffin co-Founder of Narmi, a New York City-based digital banking firm, and former credit union executive.
Another reason for credit union growth – Americans continue to be wary towards big banks. “Yes, credit unions often provide local, better customer experience than bigger banks, but there’s also consumer discontent given recent big bank scandals,” says Alex Cramer, director of the payment cards division at Final, in San Francisco, Ca. “Banks like Wells Fargo, which have used aggressive sales tactics, has pushed people away from bigger banks.”
“Something that has become more important to our society than anything else today, especially to Millennials, is time,” says Jeff White, a financial analyst at FitSmallBusiness.com, a business advisory firm in New York City. “Many credit unions push the message that you spend less time waiting in lines and less time being up-sold on products at your local credit union than you will if you join the big bank down the street.”
“The word ‘ownership‘ is very valuable to people today as well,” White adds. “At a credit union, they feel like they are a part of something, as opposed to the big bank that just wants to sell them something else. Many credit unions can offer lower interest rates, and higher dividends, because they don’t pay state or federal taxes.”
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Taken from article on TheStreet