8 ways to dramatically improve your credit union’s member service

Providing exceptional customer service in your credit union is important, helping to attract and retain customers in a competitive landscape. As technology becomes more robust and customer-buying habits shift, credit unions must be constantly looking for areas of innovation and ways to meet the demands of a 21st-century customer. That is why you it is important that your financial institution adopts the following eight methods that have been proven to enhance customer service at credit unions:

1. Empower Your Employees

Your customer service employees are your front line. As such, they need to have the right resources to provide exceptional customer service. But many times they don’t. Far too many credit unions are falling behind when it comes to providing their employees with the tools they need to most effectively do their job and that in turn not only affects customer service quality but employee morale as well. In order to change this, credit unions need to ensure that every employees has:

• Accurate, up-to-date and consistent information
• Immediate answers to their questions
• An easy way to search for information

All too often the critical information employees need in order to answer customer questions is buried in long policy documentation or only available by asking the “key go to people” i.e. lending and managers. In a recent SilverCloud poll, a majority of financial institutions reported that 30% or more of key “go to” staffs daily time is spent supporting front line staff questions. This inefficient system leaves customers waiting on hold and employees scrambling for information.

2. Educate Your Customers on Financial Literacy

The concept of educating potential and current customers on financial literacy is not necessarily new. What is new is how financial institutions today are choosing to do it and whom they’re now targeting. While financial literacy programs such as Operation HOPE and Junior Achievement, have existed outside of credit unions for many years, targeting low income and youth populations, it is only recently that credit unions have recognized the value in bringing educational initiatives in-house. In fact, Operation HOPE’s new model does just that, bringing its financial literacy program into credit union branches. And these types of financial literacy programs aren’t targeted towards the low-income population but towards middle class members, who may need education but are embarrassed to seek it out.

Bank of America has partnered with the educational site Khan Academy to offer its customers financial literacy video tutorials. And Capital One offers its customers and non-profit organizations free multilingual financial education through its partnership with MoneyWise.

When it comes to financial education, the benefits for credit unions are huge and the avenues to deliver that education are many. As a special report put out by the Federal Reserve Bank of San Francisco stated, “At a time when competition in retail banking is fierce, targeted financial education programs can open new roads into untapped populations, such as the immigrant and underbanked markets. In addition, financial education programs can also create goodwill at the community level and strengthen relationships with local members and community partners. In some cases, credit unions can also receive Community Reinvestment Act credit for providing financial education to low- and moderate-income individuals.”

3. Embrace Financial Technology

Staying in compliance with strict regulations and meeting customer demand for immediate, on-the-go service are issues in which financial institutions are constantly struggling. Yet, as credit unions and the financial sector as a whole catch up with advances in technology, they are finding great opportunities to improve their bottom line and increase customer satisfaction.

Some of the ways innovators in the banking sector are using financial technologies to improve their businesses are through:

• Exploring advances in mobile payment options
• Using biometrics, such as voice identification and eye scanning, to increase security
• Integrating systems and converting old data to new formats
• Installing drive-through video teller devices
• Taking advantage of customer data and social media (that banks have but are not using to its full potential) to enhance marketing and geographically targeted customer offers

These are just some of the many opportunities that financial technology is making available to credit unions. Due to a large number of start-up fintech (financial technology) companies, such as Square, Lending Club and OnDeck that popped up after the great recession in ‘08 there has been increasing innovation in the field. By looking to these startup companies for inspiration, financial institutions can gain an immense amount of knowledge and integrate systems and strategies that work best for their customer base.

4. Become An Advisor, Not Just a Lender, For Small Businesses

Small businesses, post recession, are looking for more than just a lender. They are looking for a business partner. For credit unions, this customer need has created a unique opportunity. Yet, many financial institutions have not figured out quite how to move beyond the traditional lender role they have played for so long. Synopsizing a recent study by McKinsey & Co., American Banker said, “Serving small-business customers more holistically is a goal that many community banks aspire to. But few are truly making a transition from the lender role to an adviser one, and there is a lot of revenue upside for those who do.”

By acting as an advisor to small business clients, credit unions gain an additional revenue stream through fee-based services. For example, Lead Bank in Garden City, MO has begun offering services such as strategic planning, capital raising and bookkeeping to supplement their traditional loan and deposit offerings. First Financial Bank in Cincinnati offers a minimal cash management service to its customers, which moves cash to a higher return investment once the account hits a certain level.

“In the Netherlands, SNS Bank has reorganized its branches into a network of advisory-focused, cashless banking shops that serve as a physical extension of the Web. Branches are store-like outlets, have open spaces, tablets that customers can use, and extended opening hours,” according to McKinsey and Company. “The original function of a bank branch – depositing and withdrawing cash – has disappeared. Instead, the focus is on a “consultant-style” mobile sales force specialized in selling complex products from both the bank itself and other providers.”

Offering additional services beyond traditional lending benefits the credit union through additional revenue and the small business customer who gains a trusted financial partner.

5. Segment Your Client Base and Create Personalized Customer Experiences

With so much competition in the retail banking and credit union space, customers have choices. What’s more, consumer trust fell after the recession began in 2008. For institutions that wish to stay competitive and build customer trust, personalization and segmentation of both messaging and services is crucial. According to an Ernst & Young Survey and a 2013 Forrester Inc. research report, Financial Service Brands Fail to Earn True Consumer Trust, “Financial service brands have long suffered from a lack of consumer trust, but the 2008 financial collapse undermined the brand relationship. Difficult as the road is, financial service brands must strive to secure brand trust to build their brand. One of the key drivers of earning back customer trust is through superior personalized product offerings. High quality products that meet customer needs are a key driver of trust in financial services.”

And with the massive amounts of member data credit unions have in their possession, the untapped opportunities for personalization are almost endless.

Credit unions have been on to this idea for years. Member relationships and community are the foundation of these institutions. So it might not come as a surprise that member satisfaction is higher among credit unions than banks. According to a study by First Data, “Even though credit unions are less widely used than national and local banks, they have the highest customer satisfaction: 92 percent of credit union customers are highly satisfied, compared to 84 percent for regional/local banks and 75 percent for national banks. The more personalized nature of the credit union membership experience may account for this higher satisfaction.” But that doesn’t mean there isn’t more that credit unions can do to improve their personalization strategies.

By personalizing messaging and services, customers are more likely to feel valued and their engagement with your credit union is likely to increase. Today, there are a multitude of personalization technologies available to banks and credit unions that allow for:

• Marketing automation that includes CRMs, lead scoring, robust email marketing capabilities and ROI reporting
• Prioritization of high touch customers and members
• Individualized interactions based on customer communication preferences
• Information delivered specifically to a customer based on prior behavior and recent transactions

Through personalization technology, members are also able to access the information they need immediately, without having to call the customer service line. And credit unions are able to proactively view and manage member journeys to better target each member on an individual level with products and services they need and want at that moment in time.

6. Stay Consistent Across Channels and Branches and at Every Touch Point

According to an Ernst & Young 2014 Consumer Banking Survey, omni-channel experience was listed as one of the key areas for improvement among credit unions. The survey stated, “To stay competitive, financial institutions need to continue building out channel capabilities to provide 24/7 real-time access to banking, seamlessly, across channels.”

Providing consistent and accurate information across channels is a constant challenge for credit unions. Yet, in today’s technological world, with members banking online, on their mobile devices and on tablets in addition to at branch locations, providing consistent information is becoming more and more crucial for institutions hoping to provide the best in member service. According to a Banking Technology article, “Research from Google has shown that 46% of people managing their finances online switch between devices before completing the activity. Often customers will start research on a smartphone before migrating to a PC or tablet to dig deeper into the information they need.”

7. Create Real Customer Relationships

Creating relationships with members is at the heart of a strong customer service strategy. It is crucially important to customer satisfaction and retention, but it is often easier said than done.

In order to create strong customer relationships, credit unions must:

• Build trust
• Be transparent
• Stay consistent and reliable

Trust and transparency go hand in hand and are very important in the financial services industry, especially in the wake of the ‘08 financial crisis. In today’s modern world as the traditional branch function changes, consistency across channels and branches is key. Through customer and employee education, rewards and offers programs, personalized marketing, technological innovation and an emphasis on customer centricity (waiving fees for loyal customers, using data to personalize messaging and services, offering free additional advisory services, etc.), these three tenets of a strong customer service strategy can be achieved.

8. Test and Then Test Again

Just like no two customers are exactly alike, no two credit unions are the same. What works for one credit union and one member segment may not work for another. The only way to know for sure what works in your credit union is to test. And then test again. Testing things such as frequency, messaging and channel of communications; target markets for certain products; and special offers are just some of the very many areas possible for testing and honing.

At SilverCloud we help financial institutions offer the best in customer service and experience. Through a sales and service application that integrates across mobile, Internet and digital banking channels, SilverCloud provides a consistent and intelligent buying experience for the customer. Contact Allied Solutions to learn more about how we work with SilverCloud help banks and credit unions provide exceptional customer service that translates into revenue, loan and deposit growth.