John Pruitt

Member business lending: Play to your strengths

Approach local businesses as a trusted adviser, CU lender advises.

October 31, 2016

Credit unions’ experience and strength in member service will build relationships with current member businesses and welcome new business members into the fold, says John Pruitt, director of business services for OneAZ Credit Union in Phoenix.

Pruitt spoke about how credit unions can serve community businesses beyond commercial loans during his Monday breakout session at the CUNA Lending Council Conference in Las Vegas.

This is perhaps the greatest time to expand member business services, he says, due to regulatory changes that will allow credit unions to serve even more businesses.

But how can credit unions take advantage of this opportunity?

Differentiate your community value with the fact you are a not-for-profit, local decision-maker.

“The decisions are not in made in Dallas or Los Angeles, and they are not just driven by the numbers on the [balance] sheet,” Pruitt says. Be upfront about the credit union difference, and stay involved in community activities.

He advises credit unions to approach businesses as trusted advisers. Build rapport by asking how they got started and what keeps them up at night.

“By making sound recommendations on how we can support them, we build trusted relationships,” he says. “We find that we can help our prospects and members save money.”

Introduce business members to more staff to gain trust, reduce their anxiety, and help them become more comfortable with having a relationship with the credit union, he advises.

Retail member accounts could grow as well if credit unions reward businesses by extending services to their employees.

“We endear ourselves to our business members by making this a benefit to offer their employees,” Pruitt says.

On the operations side, expanded business services mitigates interest-rate risk as well.

“[Variable]-rate products like lines of credit and Small Business Administration loans maintain spreads and yield compared with the fixed rates of commercial-based lending,” he says.

Read more CUNA News coverage of the CUNA Lending Council Conference.