“Unfortunately, for most people, pain is the greatest teacher. People don’t begin to make changes until they really get uncomfortable.” - Dr. Richard Moss At times, it seems to me as...
Earlier this year, the Foundation awarded Haxtun Community Federal Credit Union a Small Credit Union Grant in the amount of $5,000 to implement an online banking program. While the grant did not cover the entire cost of the Online Banking Program, it offset a large portion of the expense, allowing Haxtun to reserve funds for other important growth initiatives.
The Foundation’s Small Credit Union Grants are reserved for credit unions with under $50 million in assets who wish to institute programs and services that support compliance, such as consulting programs, technology and software, and professional services.
The staff at Haxtun felt that their members were underserved because they did not have access to online banking options, including access to their accounts, e-statements, and online loan payment options. Haxtun CEO, Kristin Hadeen, explained that they had completed some research showing that more than half of adults and three-quarters of 25-34 year olds now manage their money online. Recent studies show that 42% of those users will use their online banking 5 times per month or more. Furthermore, 27% of those users will only go to their branch once a month. The Haxtun staff realized that adding online banking would help their credit union serve their members better, allowing them to keep balances in check and maintain loan payments more effectively.
Kristin explained, “Without online banking, our only option was to mail paper statements, notices and promotions to our members. Inevitably, this resulted in member inquiries about not always receiving their notices or statements. We felt that an online banking program would, among other things, greatly reduce this “lost mail” problem, reduce the cost of these mailings, reduce collection costs by averting one cause of delinquencies, and make banking with us more convenient for our members. By giving our members the ability to check their balances any time, including on their phone, we hoped to make it easier for them to be more aware of their financial situation. We also wanted to do more to attract new members.”
Increasingly, new and potential members are demanding online banking options, even in rural communities like Haxtun, CO. Millenials in particular don’t want to have to come into the branch in order to manage their money. Established in 1938, Haxtun has always been strictly a savings and loan institution. However, they will be adding additional banking services, including checking and debit, in 2017. After conducting a member survey, the staff at Haxtun learned that some people in their community were driving as much as 30 miles just to set up accounts at institutions with online banking options. They learned that 61% of their members would be interested in moving their current checking accounts to Haxtun Federal Credit Union if online banking was an option.
For all of these reasons, adding online banking options was a high priority for Haxtun. However, they had several other expenses to consider. The credit union has doubled in size since 2012, requiring the addition of staff. The building that houses the credit union is also in need of remodeling, repairs, and an updated security system. The Small Credit Union Grant allowed them to reserve some money for these additional requirements while moving forward with the implementation of online banking.
Over the past few years, the staff at Haxtun has been focused on being a more integral part of their community. They wanted to be more than just a place where people store their money. They’ve made a concerted effort to become more deeply involved in community events, more active in the local chamber of commerce, and even instituted a financial education program in local schools. This involvement resulted in rapid growth, precipitating the need to serve new and existing members in a more complete capacity.
After receiving the Small Credit Union Grant early this year, Haxtun was able to launch their online banking program in August, an e-statement program in September, and have even added banking apps for Android and iPhone. So far the reception has been positive, although some of their older members are wary about online banking. To help them feel more at ease, the Haxtun staff plans to offer classes and one-on-one tutorials aimed at showing these members how to set up and use their online banking options, and giving them an opportunity to voice questions and concerns.
Kristin explained that until they are able to launch checking and debit options, online banking is just the first step. However, it’s already proved to be a move in the right direction, increasing their ability to compete with larger financial institutions and offering more support to members.
We applaud the efforts of Haxtun as they strive to embody the credit union philosophy of people helping people on a deeper level. If you are interested in applying for a small credit union grant, I invite you to visit the Foundation website for more information.