Does your credit union meet these six needs?
By Theresa Witham
According to data from NCUA call reports, 2,300 credit unions are engaged in member business services. The credit union industry holds $54 billion in loans with an average loan amount of $240,000. Jim Devine and Bob Hogan, lead faculty at CUES School of Business Lending, have over 30 years of experience in business lending and have worked with thousands of small business owners. They have explored the questions: What is it that small business owners are looking for and why would they pick you? Devine and Hogan say the answer boils down to the following six things business owners expect to receive from their financial services provider:
1. Access to credit: “They will be looking for you to help them with their capital formation strategy and develop for them the types of credit products that will address their needs. This will vary dramatically,” says Devine, founder, chairman and CEO of Hipereon, Inc., and include term and short-term loans, lines of credit, and real estate loans.
2. Be valued: Business owners want to be valued as a member of your credit union and acknowledged for their economic commitment to the local area, says Devine. As part of this, they’re looking for products that offer customization. “They want to know that you can look inside their organizational design and provide for them those types of financial services and products that are specific to what’s unique about the way they operate and what their business, functionally, will need,” he adds.
3. Expertise: “Business owners want to deal with someone who knows or can connect them to the right solution, someone who can deliver,” says Hogan, founder, president and chief operating officer of Hipereon, Inc. They’re also looking for someone who can effectively communicate. “This is a huge deal in today’s business world,” he says. They are looking for people who don’t talk to them in “accounting-ease,” or “banking-ease” but instead in terms that business owners can understand. “You take complex financial situations and explain it to a person in day-to-day language so they can understand it,” Hogan says. “These are people that are doers. They don’t have the academic background that accountants and bankers have.” In addition, business owners are looking for an educator, a mentor. “Tell me how this stuff applies to my business and how I can use it to make better decisions,” Hogan says.
4. Convenience: To a small business owner, convenience means: a) multiple delivery channels. Business owners want access to their accounts via online, especially via their smartphones, says Hogan. b) accessibility through convenient locations and times. “Be available when I’m available, when I’m working,” says Hogan.
5. Choices: One size does not fit all. They want products uniquely tweaked to fit their business financial model. Business owners also want creativity in their financial provider. “Do you have the business model structure expertise on your side of the desk that enables you to walk around and come up with solutions that are customized?” asks Devine.
6. Security and confidentiality: “If they can get things secure and confidential and get it local and better, yet get it on a face-to-face basis by someone who understands them and understands business in general, that is without a doubt what their preferences are,” Devine adds.
Theresa Witham is a senior editor with CUES.
Learn from Jim Devine and Bob Hogan at CUES School of Business Lending II: Financial Analysis and Diagnostic Assessment, CUES School of Business Lending™ III: Strategic Business Lending, and CUES Advanced School of Business Lending™:
