More credit union lenders report ‘UFO’ sightings in auto loan books

Rich data insights on borrowers are to credit for the ‘unidentified financial opportunity’ phenomenon.

Despite a significant slowdown in auto sales at certain points in 2020, credit unions held steady with their indirect lending programs. Anticipating that business could turn around at any point, most kept the same number of people focused on the auto loan portfolio.

Now, a funny thing happens when things slow down, especially with credit union people. They get curious. That’s when things get fun for data geeks like my AdvantEdge Digital colleagues and me.

During the summer months of 2020, we had the unprecedented opportunity to dig deep into credit union data to see what we could uncover about the individuals and families who turn to credit unions for help financing a car. What we found was awesome. As it turns out, the indirect loan portfolio is chock full of opportunity.

Of course, it should be acknowledged that those opportunities can be somewhat nebulous. In fact, it’s why we’ve taken to referring to them as “unidentified financial opportunities” or UFOs. The term is apropos, really. In real life, UFOs are shadowy, shapeless and imprecise. However, when people get serious about investigating them, they often find that the unidentifiable is, in fact, quite identifiable (as aircraft, satellites, meteors or even balloons). The same is true for the UFOs hovering around a credit union’s car loan business. If you look closely enough, they start to take shape as actionable insights that can drive real growth.

 

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