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Credit unions have a long history of providing education for their members. This adds to the many personal benefits that set credit unions apart from other financial institutions. As the financial services industry has evolved technologically, it has sometimes been difficult for smaller institutions to keep up with the big budgets and expertise required to develop and maintain cutting edge systems and solutions.
Enter the world of video.
Now available in a variety of formats that are affordable, easy to access and simple to disseminate to members, video is on trend with modern communication and more “hip” than other traditional forms of marketing. With the advent of YouTube, video has become a widespread medium for conveying everything from “DIY” to entertainment and for marketing across generational and demographic market segments. Businesses across every sector of the economy are deploying video to better communicate with and educate their customers.
Credit unions would be well served by following their regulators’ lead and exploring the exciting new opportunities for communication with members through video.
The National Credit Union Administration offers its own YouTube channel that provides information about the economy, consumer protection and fraud.
In this same vein, the Consumer Financial Protection Bureau hosted in April 2014 a forum on the benefits of e-closing technology. During the forum, lender participants in CFPB’s Know Before You Owe eClosing pilot commented on the value of video at the time of closing to introduce title company practices and representatives to consumers. Stakeholders such as lenders, vendors and other industry leaders agreed that offering innovative consumer outreach channels, such as video, is a vital component of successful and responsible lending as the industry further embraces technology and expands its market reach to Millennials.
A Banking Example
For St. Louis-based Delmar Financial, using VidVerify gives it a “compliance edge,” says Todd Solomon, an owner and senior vice president.
Rather than having to worry about consumers who say they were not notified about certain aspects of their loan, “we could see the videos that they've watched and we know that they've watched them. That helps us with compliance issues and, in this era, compliance is becoming a mountain of responsibilities that lenders need to keep up with.”
Solomon’s sales staff likes that they can customize their own videos. They believe they have a competitive edge because those videos provide consumers, especially first-time home buyers, with a better understanding of what is happening. People are very visual, so even though the originator explains the information, these videos help to reinforce it, Solomon says.
It “holds their hands through the process,” plus the videos provide “good preparation for what going to come next,” he adds.
Delmar Financial's sales team is able to create its own videos, including a good-bye video to send when the loan closes, where they can thank the customer and ask for referrals, Solomon says. The sales staff is also creating videos to be used for client retention.
Delmar knows its clients are being “well informed” about the origination process, and video is a key part of this, Solomon says.
CUs and Mortgages
Credit unions lead financial institutions in offering auto loans and home equity lines of credit, with competitive advantages in other loan and depository products. Conversely, mortgage lending has often been difficult to staff and manage due to its complexity and balance sheet risk. Focusing on conservative, vanilla mortgage products served the credit union industry well during the financial crisis; however, now that the industry is beginning to adjust to the requirements of the Dodd-Frank Wall Street Reform and Consumer Protection Act, successful credit unions need to become more operationally and technologically savvy. This is critical to developing sustainable processes that meet today’s compliance requirements and also deliver mortgage loan solutions that will attract credit union members, especially Millennials.
Regulation and education are rarely the most exciting topics discussed by your membership or staff. Video offers credit unions the opportunity to quickly and easily embrace new, hip trends in communication. By deploying video communication and disclosures, credit unions can bolster interest and participation in educational efforts and, more importantly, ensure members are informed about their financial decisions, while keeping compliant with regulations. Even the smallest credit unions can improve its visibility and credibility in the community with video.
Tim Stern is president of Vidverify, St. Louis.
