Despite the emphasis on big data in recent years, only 5% of credit unions can truly integrate their data, says Paul Ablack, founder/CEO of OnApproach.
The credit union service organization assists credit unions in leveraging their data to support better decision making and drive profitability.
“Typically, credit unions have some type of home-grown data warehouse or buy a resource from a core vendor that doesn't allow them to integrate with other systems easily, or to share pool data with other credit unions,” he says.
Credit unions should view that low level of capability throughout the industry as an opportunity because getting up to speed provides a competitive advantage, Ablack says in the latest CUNA News Podcast.
“Retail and manufacturing use data analytics better, which is why it’s so attractive to get involved,” he says.
Among the many purposes for data analytics, Ablack emphasizes the promise of faster loan decisioning, expanded subprime lending markets, and targeted membership growth.
Less than 10% of members are profitable, says Ablack, who notes that two members can have the same product set but only one might be a productive member.
“You’ve got to find a way to entice and reward profitable members,” he says. “If credit unions can expand that base of profitable members, they can be very strong in the future.”
Credit Union Magazine’s Fall 2023 issue examines how artificial intelligence is shaping marketing, strategies to improve cyber hygiene and overall cybersecurity, the need to employ risk management to address inflation and its impacts, new approaches to board recruiting, and NCUA’s top supervisory priorities.
