Credit unions in Connecticut and New York are driving branch innovations that are rolling in new members and new loans.
The $439 million Nutmeg State Financial Credit Union in Rocky Hill, Conn., opened a new branch that doubles as a state Department of Motor Vehicles center, where citizens can renew their driver’s license. The Milford branch draws about 200 people daily, resulting in nearly seven new credit union members each day. What’s more, during its first three weeks of operations in June, the Nutmeg/DMV Express services branch processed $1 million in loan applications, $600,000 of which was funded.
In New York City, the $2.9 billion Municipal Credit Union rolled out a new branch on wheels, a customized van, which brings a wide range of non-cash services to busy members wherever they are. Since it hit the road on July 9, the fully-equipped office has brought a new level of convenience that is attracting new members and promoting the credit union brand.
To address the issue of declining branch traffic, Nutmeg developed a strategy to modernize the retail member experience by equipping its branches with interactive kiosks that feature customized technology developed by Nutmeg’s CUSO, Daland Solutions. In addition to enabling members to complete traditional transactions, the credit union’s kiosks allow members to apply for a loan and secure funding if approved, get a new debit or credit card, and if they are a non-member, apply for membership and fund their account.
“Basically, the members act as both the member and the teller,” Jeff Levesque, Daland’s CEO, who served as Nutmeg’s COO for four years, said. “We developed our own technology platform, which removed the roadblocks and restrictions [of traditional ATMs] to allow members to interact [with the kiosk] the same way they could at any of our traditional teller branches.”
In addition to developing the self-service branch model to improve operational and financial efficiencies, the second part of Nutmeg’s retail strategy included establishing partnerships with retailers to share the branch as a center to serve their customers.
Initially, the credit union was looking to collaborate with mobile phone providers that would overlap with Nutmeg’s technology strategy of delivering modern delivery channels to customers.
The credit union then learned that the local chapter of the American Automobile Association was exiting the driver’s license renewal service throughout southern Connecticut, and the state was looking for a new partner.
“DMV Express was something that we helped to brand for our pitch to the state when they put out the proposal for bid,” Levesque explained. “Our pitch was to modernize the DMV experience.”
Modernizing the DMV experience meant substantially reducing the license renewal wait times from more than three hours at a Connecticut DMV center and 23 minutes at an AAA office.
At the Nutmeg/DMV Express branch, the average license renewal wait time is just seven minutes, thanks to the credit union’s technology.
“So part of the [kiosk] technology that we’ve implemented is the efficiency of scanning your current license, pre-populating the DMV document checks for the renewal license, and also collecting the $8 convenience fee you can pay with debit or cash at the kiosk,” he explained. “That process takes about 30 seconds on average. Then we offer three options. You can wait in line and the system tells you exactly what the current wait time is and how many people are in front of you. You can join the line and hold your place, meaning you can leave and come back later on, and when you come back in, you’ll get to the head of the line in the position you were in at the time you walked in. Or you can schedule a time to come back, and there’s a dedicated set of windows that honor scheduled times. That’s how we’re keeping that average wait time where it is.”
The $8 service fee is waived for members, and refunded to non-members who join Nutmeg at the branch or decide to join later.
Because they are mode-based, the kiosks operate to process license renewals and provide credit union transaction services. Credit union employees can change the mode of each kiosk depending on the amount of foot traffic and demand for each service.
The Nutmeg/DMV Express branch is staffed by eight employees who serve members and renew licenses.
The kiosk screens feature marketing messages, such as the value of Nutmeg membership, while people are in the process of renewing their licenses. Other marketing messages are posted throughout the branch.
On the kiosk, non-members and members can initiate an inquiry about loans. The information about that non-member or members is forwarded to an employee tablet, so they know exactly who to approach. However, non-members – like members – also have the option to apply for a loan. What’s more, the kiosk technology allows non-members to join the credit union, fund their account, complete the loan application and secure the loan check.
Most of the $600,000 in loans approved during the three weeks in June at the Nutmeg/DMV branch funded mortgages, auto loans or personal loans.
“We started with the self-service loan experience on branch tablets and on the internet two and a half years ago,” Levesque said. “Most of our loan volume comes from those self-service channels.”
So far, the 800-square-foot Nutmeg/DMV Express branch has exceeded expectations, and the credit union plans to open a second, 3,000-square-foot Nutmeg/DMV Express branch that is expected to double the capacity for DMV license renewals and self-service banking.
About 100 miles southwest, MCU serves nearly 600,000 members who live or work throughout New York’s five boroughs and Long Island. Some of them may not be near one of the credit union’s 19 branches or they may not have time to visit a branch.
MCU Vice President of Business Development and Member Relations Corey Fernandes said members have been asking for more branch locations. Obviously, it’s not realistic to open new branches quickly and inexpensively. So from a strategic planning session sprung the idea of putting a fully-equipped branch into a modified utility van and driving it to service members at their workplace.
This July, its first stop was at a Brooklyn hospital, where more than 100 members and non-members came to see the branch on wheels.
“We had several people who signed up for several products and services,” he said. “The feedback we’ve been getting has been tremendous. We see the need every time we go out there and members are excited about this. It’s something new and innovative in our market.”
MCU works with its various SEGs to determine where the need for the member service van is needed most. SEG employees are notified in advance when the MCU van is scheduled to roll up to their workplace.
The fully equipped van is staffed by a minimum of two employees who typically assist members with opening new accounts, make changes to payroll or direct deposits, and process loan applications. The service van also provides members with access to financial education resources. It’s also used for community events that can broaden MCU’s brand awareness throughout its market.