Efficiency, with a goal of increasing member value, drives many strategies at $1 billion asset Fort Knox Federal Credit Union, Radcliff, Ky., says Bill Rissel, president/CEO.
“We weren’t the first out with mobile banking,” he says. “We evaluate technology to make sure it fits with the credit union’s efficiency priorities and whether it works for the entire membership.”
For the coming year, one priority is to find ways to increase branch hours and service, without increasing costs. “We’ll push video to our branch drive-ups. We can batch the entire drive-up process in one location without affecting the existing member experience,” says Ray Springsteen, senior vice president.
“We’ll eventually have 14 branches open extended hours through the drive-up, with only three or four staff working. And members will still see employees on video,” he explains. “The extended hours will be a huge value to members, without much additional cost to the credit union.”
Fort Knox Federal offers mobile technology on a limited scale, with a large-scale rollout planned by year’s end. “We wanted to understand how members would use the channel, and it’s a little different than we expected, with extremely high use of text banking,” Springsteen says. “We want to make the channel easier for members to use and to ensure it’s efficient for the credit union.”
Long-term, Rissel envisions more integrated service across all channels. “In 2012, we made a big investment in our call center technology. We need a more effective way to manage member relationships remotely.”
He also foresees more nontraditional payment methods. “The process will continue to shake out, and we want to be sure we’re a player in members’ payments, and are top of mind for them in the mobile channel.”
A heavier regulatory burden forced the credit union to increase technology spending on compliance. To comply with the overdraft-protection opt-in requirement, for example, the credit union pushed electronic alerts and statements instead of paper, along with “swipe and sign” rather than “swipe and PIN” debit card transactions.
“PIN-based transactions cost about double for now, so we charge $1 when members opt to do ‘swipe and PIN’ transactions,” Springsteen says.
The focus on efficiency while investing in technology is paying off. The credit union’s expense-to-asset ratio is in the top tier for credit unions, at about 2.4%, Rissel says. “Technology allows us to be more efficient and to create incredible value to give back to members.”