As we prepare to close 2020 and begin to plan for 2021, credit unions are considering strategies and solutions. Each year in November, lenders from credit unions across the country gather at the CUNA Lending Council Conference to discuss trends, network and have some fun. TransUnion proudly supports the CUNA Lending Council as an event sponsor, and it’s personally one of my favorite events of the year. In the current environment, we attended three days of virtual sessions and several themes emerged.
Here are the five trends we identified with important implications for credit unions.
1. Adoption of trended credit scores
At TransUnion, we’ve certainly seen trended credit data emerge as a priority from our partners over the last year. At the conference, we observed a marked uptick in questions about trended scores from many credit unions. The number of credit unions indicating they are using or will use these scores in indirect lending is an important new development. As credit unions face new competition and new challenges as they work to grow lending in 2021, it was clear that credit unions are using trended credit data rather than traditional, point-in-time credit scores to meet their needs.
2. Experience, the credit union way
While most credit unions aren’t looking to become FinTechs tomorrow, they want to improve the loan application experience. Whether that’s by offering consumer-initiated prequalification (when members can check their rate without impacting their credit score), leveraging partners to help deliver offers in real time, or implementing an always-on, perpetual preapproval strategy, credit unions are actively refining and enhancing their digital lending experience.
3. Understanding and identifying impacted members
As millions of Americans are still experiencing a financial impact from the pandemic, credit unions are evaluating new types of data. These new sources of information help credit unions understand and manage members who missed payments or are receiving some other kind of accommodation or forbearance.
4. Member-centric solutions
Whether text messaging for proactive collections efforts or improving cross selling through prescreens, credit unions are looking for ways to use data more intelligently to target and engage members. Consumers expect this type of personalization, but it’s also core to the credit union brand promise. Credit union lenders are clearly working to uphold this promise on the road ahead.
5. Ramp up of prescreen marketing
After some credit unions scaled back on preapproved marketing campaigns in recent years, more feel confident about re-entering the market. With share deposits growing quickly at double-digit rates, several lenders see prescreen marketing as a key tactic to reach their 2021 loan growth goals.
Sharing strategies is a hallmark of this event and the credit union movement. Each year, it reinforces my personal commitment and TransUnion’s commitment to helping grow this industry. As credit unions consider how they can implement these strategies and act on opportunities, we’re here to help. Please fill out the form below if we can assist.