Whatever your credit union’s past experience with and impressions of CUSOs, credit union boards cannot afford to ignore the benefits CUSOs bring to credit unions today.  Successfully using CUSOs requires change, and while change is difficult, it is essential to meet the challenges posed by today’s world.

CUSOs help credit unions solve problems and leverage opportunities.  CUSOs are essential competitive tools for credit unions. Your competition is no longer just other credit unions and banks within your area code.  There are hundreds of financial service providers that are chipping away at your payments, loans and deposit services.   Many competitors have lower operating costs, sophisticated data bases, and slick technology that offer members convenient and efficient financial services at low costs.   How will credit unions successfully compete against bank and non-bank competitors that can deliver mortgage loans approvals in less than an hour and unsecured loans in less than a minute?  If credit unions cannot find ways to meet the increasing expectations of consumers on speed and convenience, the traditional credit union model is at risk of becoming an historic footnote.   Does your credit union have the scale, capital and expertise to build competitive technology delivery platforms on its own?  If not, how will you obtain scale, through merger or collaboration?  CUSOs are a means for credit unions to increase scale and remain independent credit unions.  If you are not using CUSOs to help your credit union compete in this hyper-competitive marketplace, you are putting your credit union’s long-term survival at greater risk.   The benefit of CUSOs is not abstract theory.  There are numerous examples of CUSOs that generate significant net income through either lower operational costs or additional revenue sources.  Time is of the essence. Credit unions can no longer afford to say that they will get around to using CUSOs “some day”.

 

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