Making financial inclusion a priority at your credit union is not only a “feel-good” thing to do, it is an effective business strategy, says Scott Butterfield, principal at Your Credit Union Partner.
“It is a differentiator,” he explains.
Everybody in financial services is competing for prime borrowers, but you can make a real difference and profit serving those without flawless credit reports.
Plus, it’s what credit unions were created to do, he notes. “It is in our DNA.”
In order to be successful using a financial inclusion strategy to grow your credit union, Butterfield recommends linking:
► Products to needs. Find out what your low- to moderate-income consumers need in your marketplace.
For example, if you serve immigrant communities find ways to help them get citizenship.
“Helping people get their citizenship is one way to connect them to financial services and your credit union,” Butterfield says.
► Partnerships to outreach. Find partners that share the same values and want to serve the same audience.
“We want community partners that believe what we believe,” he says.
► Resources to capacity. Obtain NCUA low-income designation status or Community Development Financial Institution certification from the U.S. Treasury Department.
These offer credibility and opportunities to obtain grants for secondary capital for low- to moderate-income products and programs.
“You can really turn on the gas and grow with secondary capital,” Butterfield says.