CULedger also leverages the power of collaboration to create solutions for credit unions through innovative technology. In this case, CULedger and its investors are exploring the possibilities of distributed ledger technology.
A distributed ledger is a database that’s consensually shared and synchronized across a network of multiple “nodes.” Participants at each node can access the records across the network and own identical copies of it.
Any changes or additions made to the ledger are reflected and copied to all participants in a matter of seconds or minutes.
CULedger President/CEO John Ainsworth says the CUSO’s founders hope to provide solutions in three areas for credit unions: member authentication, lending, and payments.
Ainsworth says the “hub and spoke” of CULedger’s strategy is authentication. The company will roll out a proof of concept this fall, with plans to announce pilot programs at eight credit unions and system partners later this year.
As its offerings evolve, CULedger could also produce huge benefits in another contentious area for credit unions: compliance. “We want to raise the bar on know-your-customer compliance,” Ainsworth says. '
“Credit unions can become a trusted authority on identification. We can take what was a regulatory requirement and not only reduce costs but turn it into a member benefit.” CULedger is comprised of CUNA, the Mountain West Credit Union Association, Best Innovation Group, credit union system partners, and credit unions. Ainsworth says the company’s approach extends beyond dollars and cents.
“It’s not a competitive CUSO model,” he says. “We see ourselves as an enabler to enhance or offer complementary services to other CUSOs to make them more efficient.”
CU Lending Cooperative
CU Lending Cooperative (CULC) gives credit unions access to marketplace lending, a relatively new type of online lending that connects consumers with multiple lenders. When a borrower applies for a loan on a marketplace site, proprietary CULC software instantly qualifies the applicant and matches them to a participating credit union where they’re eligible for membership. CULC’s cloud-based system creates the necessary account records in the credit union’s core system and funds the loan.
CULC President/Founder Mike Joplin says the pitch to borrowers includes the benefits of credit union membership. “We bring the credit union highly desirable new members,” he says. “It’s up to the credit union to aggressively onboard and upsell that member, further deepening the relationship we created.”
Joplin also is CEO/co-founder of CU Revest, an asset management company that recovers chargedoff consumer loans. The company rehabilitates and recovers qualified members, returning them to good standing with their credit unions. In the process, it turns charged-off debt back into capital.
“There’s no way a credit union could do this on its own,” he says. “By allowing credit unions across the nation to join forces, we can create a real economy of scale.”
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