A great year for financial well-being for all

It’s been nearly two years since the credit union movement officially made financial well-being for all the focus of all the work we do. CUNA, Leagues, and credit unions made great strides this year, and this sets us up for future success.

Our 2022 National Voter Poll provides data that shows credit union members have greater financial resilience and financial well-being than other consumers. It’s become the foundation of our advocacy work, as improving communities’ financial well-being continues to garner bipartisan approval.

We made this case to state policymakers this summer at the National Conference of State Legislators. CUNA Chief Economist Mike Schenk outlined exactly how credit unions are a better choice for consumers. Not only did attendees embrace those sentiments, many shared their own fantastic stories of credit union service.

Our focus on advancing the communities we serve resonates with legislators. We ran digital ads throughout the conference touting the credit union difference, and those ads got the highest click-through rate at these conferences to date.

Federal, state, and local policy makers respond to financial well-being for all because it aligns with why many of them got into public service in the first place: to better their communities.

Our job is to show them that credit unions are an essential part of improving financial health, and only outdated policies—restricting the good we do—can stop us.

Looking ahead

So, what’s next? Waiting for the next step is not what we’re about.

We’re proactive, we meet challenges head-on, and we focus on both the future and the present. Financial well-being for all calls on us to dive into the data, use it to back up our claims, and show what we can do.

CUNA recently acquired a massive dataset, and we’re poring over it for new insights as well as data that shores up previous findings. One of the most interesting findings relates to auto lending.

Reliable transportation is a foundational aspect of financial well-being for millions. It’s how folks get to work, shop for food and clothing, and travel. The data shows credit unions have a clear and strong commitment to providing affordable access to car loans.

Credit unions, which hold 8% of depository financial institution assets, have a 37% share of auto loan originations (“‘My story’ by the numbers,” p. 32). Clearly, credit unions are doing something right.

When we look deeper into that data, we see a strong credit union focus on responsibly serving consumers of modest means, according to credit score.

Overall, 65% of bank auto loan originations in the second quarter of 2022 went to consumers with “super prime” credit scores. Only 51% of credit union originations are in this category.

Nearly a quarter (23%) of second quarter credit union auto loan originations went to consumers with below-prime scores. Only 14% of bank originations are in this category.

Credit unions also stick with their members through the life of the loan. Credit unions—through better financing rates and a culture that works with members to pay their loans on time—have substantially lower delinquency rates compared to banks and auto finance companies.

Bank delinquency rates are roughly 40% higher than credit union delinquency rates. Auto finance company delinquency rates are 2.5 to 3 times higher than credit union delinquency rates.

Using interest-rate averages, we estimate credit union members save roughly $1,500 over the life of a new auto loan compared to consumers using for-profit providers.

This data is the tip of the iceberg, and this year is just a glimpse of what’s possible when our movement collaborates at every level to improve our members’ financial well-being. Thank you for being a part of this journey.

JIM NUSSLE is president/CEO of Credit Union National Association.