There is so much overwhelming unaddressed need, and the seemingly consistent approach being used is feckless in addressing the problem. The screaming need for change in approach goes unheard. The current solutions are not working, so why not change the solutions?

I remember the simpler times. People actually knew each other. When you lent Mary money you were doing something that Peter and Paul would have approved. The credit union just kept the record.

Today, the transactions are electronic. Cold and impersonal expedited transactions are well and good for a large majority of people who are qualified for loans from ubiquitous sources of credit providers. Those of modest means are being left behind. Time, costs and regulatory issues seem to be at the foundation of the problem.

The NCUA spends millions each year attempting to figure out why small credit unions who are closer to the people of modest means are no longer working. The NCUA reports back with no effective solution but to continues to merge smaller into larger. The larger credit unions are regulated using bank strictures and we all know how effective they are in addressing the needs of people of modest means.

Read more: Credit unions were effective in providing face-to-face explanations about loan denials …

Everything needs to be done yesterday. I cannot imagine telling a member today that you have to wait until some day in the future when the credit committee meets to provide you with a decision on your loan request. Borrowing was considered a privilege and not a right back in the Stone Age. People were content to wait. Effective credit unions provided face-to-face explanations about loan denials and ways to achieve approval. There was greater civility because you could not hide behind an electronic barrier.

Consumer credit for A/B members is available at the click of a mouse. No relationship is necessary if you meet the numbers. Why take on additional expense reaching out to people who don't meet the numbers? It seems the elected strategy is to compete for more A/B business.

Credit unions were designed to address a need. Regulations at one time seemed consistent with the goals. Operations of credit unions were also consistent with the economics of the time. All this has changed. Regulations designed to prevent consumer abuse seem to have adverse, unintended consequences. Members of modest means are put on the road to hell by well-intended regulations.

Credit unions have become so sophisticated that they fail to serve the desired market. Years ago, Ken Davis, the CEO of Transit Federal Credit Union, suggested to me that credit unions were getting so sophisticated that they were going to forget how to get a member to his next paycheck. His prediction seems to have come true.

Can it not be high time to change the paradigm from something that is not working to something that just might? Can we use technology more effectively? Can we modify regulatory requirements? Can we restructure credit union relationships to improve outreach to people of modest means?

There is no reason for a credit union to offer an idiot-proof access account. Credit unions choose to use checking accounts as a fee generator. Maybe we could develop micro-credit unions for small businesses who could be sponsored by larger credit unions. This smaller unit could make payday loans based on their knowledge of probability of a future paycheck and get a right to the amount necessary to repay the loan upon leaving employment. Relationships with churches and other community associations should be examined for potential use of a micro-credit union relationship.

Doing nothing but shaking your fist at the problem does not seem to be an effective solution. All parties need to come together. They need to honestly identify and address the problem. If changes need to be made, then changes should be made. The first step seems to be getting honest about the situation and your role in it. If you don't, you may be deluding yourself into believing you are successful, but Diogenes' lamp will pass you by.

Bill Brooks is a certified financial planner with CU Prosper. He can be reached at 302-258-4668 or [email protected].