Don’t leave member protection behind while moving digital lending forward

An interview with an industry expert on a timely topic for credit unions...

Online banking services continue to grow in popularity and demand. However, it’s important to take a closer look at the full value of the branch experience – and make sure important features and options are not left behind.

I sat down with Cathy Klimek, senior counsel, Securian Financial, to gain her insight on the importance of making sure credit protection remains part of the digital experience for members and how credit unions can make it happen.    

As credit unions quickly evolve to offer more online lending options to members, do you think they fully grasp the importance of making sure credit protection programs make the move online as well?

They understand the importance; it may not always be a priority. The pandemic has resulted in credit unions having to quickly pivot and make loans available in new ways. Credit protection likely fell by the wayside during the initial push to keep up with the lending needs of their members.

Credit unions are reaching out to you for guidance right now; what’s driving their outreach?

For those credit unions reaching out, they are already tuned in to the value of credit protection; it’s embedded in their sales culture. They understand the important protection it provides members. And, they emphasize the value internally by encouraging loan officers to make it part of their regular conversations with members.

When they make the move to provide more digital lending options and resources to members, it’s a natural progression to include the lending protection products. They also understand the importance of doing it the right way. That’s why compliance and member experience is where we spend most of our time during a consultative session.

What does your consultative approach look like? How do you get started?

First, I provide an overview of what to consider when making the transition from paper to digital lending and credit protection. This includes e-signatures and what is known as date and time stamping. These processes essentially walk members through the necessary disclosures and captures their acknowledgement or response to what is provided. This provides the audit trail needed to administer the program and the members’ elections.

It’s important to socialize all considerations and confirm compliance with all necessary rules and regulations among internal lending, compliance and technology teams. The move to digital requires a coordinated effort.  While it’s not necessarily a difficult transition, a phone call to get them all grounded in the new process and walk through the details, works well.

When working with credit unions, what challenges have you helped them overcome in order to offer credit protection alongside online lending options?

It’s important to make sure nothing is missed in the translation from the paper to the digital world. I offer to walk through lending system screens together – just as they will appear to members. By doing so, the credit protection is introduced when and where it should be that’s easiest for the member – and in a compliant manner.

What are the three most important factors for credit unions to consider when offering credit protection online?

  1. Compliance, compliance, compliance!
  2. Keep it simple, quick and easy to understand.
  3. Create a seamless experience including simplified eligibility.

The pandemic has resulted in many credit unions making a move to digital resources and tools almost overnight. What has surprised you the most? What do you see as the biggest learning opportunity?  

Credit unions have known they needed to be online for some time; the emphasis on member needs and the accelerated pace of the transition has taken the industry by storm. Consumer buy-in, across all ages and life stages was a surprise. It was assumed millennials would get on board quickly, but we are seeing all generations getting more comfortable with online banking. Consumer buy-in to this new digital world will only continue to rise.

The pandemic has provided a new way to look at how organizations react to large scale disruptions. The lessons learned during the pandemic can be applied to everyday operations! In particular, the pandemic has given organizations an opportunity to see what most concerns consumers, what drives their anxiety, and how they can be of help in a more holistic manner. Good leaders and good organizations will learn from this and apply it beyond pandemic planning – and a need for an immediate pivot caused by disruption. While the circumstances have not been ideal, the pandemic has created opportunities to come out the other side stronger, more innovative, and better poised for the future.

Judie Elbum

Judie Elbum

Judie has over 30 years of experience working with financial institutions and strategic marketing and communications efforts. Her responsibilities include the development and execution of national marketing and communications strategies ... Web: www.securian.com Details