CUs Have a Major Opportunity to Bring More Value to Business Members
Completely serve your SMB accounts by supporting their financial and cybersecurity needs.
The avalanche of data breach events in the U.S. continues to plague businesses of all sizes. Headline-making news captures the larger company breach events, but there are thousands of small- to medium-sized businesses that face devastating consequences from criminal attacks … and we just don’t hear about it. In fact, 53% of mid-sized businesses have already experienced a data breach, according to a recent Cisco SMB Cybersecurity Report.
Many credit unions serve the financial needs of small- to medium-sized businesses (SMBs) with services that help them maintain and grow their hopes and dreams. But according to recent studies, lurking in the dark are criminals who are focused on infiltrating these SMBs and creating a nightmare from which many cannot recover. These organizations often have smaller cybersecurity budgets and may not be able to afford a chief security officer or in-house security team able to take on protective and response duties.
Today, there are breach recovery and ID theft protection services available that can help protect SMB owners from a possible collapse of their lifelong dream. Credit unions have the opportunity to offer this type of service to their SMBs, which can provide the ultimate safety net for your business members. These services can also create greater member loyalty and a superior business engagement program.
Recent statistics from the National Cyber Security Alliance indicated your business members are the most vulnerable to cyber-attacks. And according to a recent CU Times article, the number of data breaches in 2019, so far, indicate a record-breaking year ahead of us. Now is the time to take action.
Do your due diligence and research to find solutions that allow you to more completely serve your SMB accounts by supporting their financial and cybersecurity needs. There are solutions that go far beyond cyber insurance to create a comprehensive cybersecurity preparedness that ensures your business members survive and properly respond when faced with a breach disaster. Let’s face it, SMBs need to be focused on their day-to-day issues, and they do not want to be burdened with financial stress or external threats from would-be criminals. Credit unions can differentiate themselves in these stressful times to provide a unique solution to SMBs, and position themselves for more loans and revenue in the future, which can help maximize engagement with businesses as well.
As the data breach tidal wave continues within the U.S. and internationally, the likelihood of an SMB executive or key employee experiencing a personal ID theft event is growing. As SMB executives and employees receive more and more breach notices, the individual threats are escalating and, more importantly, the consequences of an attack today are more devastating than ever before. According to recent statistics from Javelin Strategy Research, out-of-pocket costs for victims more than doubled in two years. Therefore, SMBs are also in dire need of credit union services that would extend ID theft recovery programs to all their employees, or at least the primary employees and company executives.
Again, credit unions have access to service providers who can make it possible for them to provide this kind of critical SMB support for ID theft attacks against their business members’ employees and management. These ID theft recovery services often can go hand-in-hand with finding the best data breach recovery services from service providers. Incorporating both data breach and ID theft recovery services into your business member account service offerings will differentiate you from competing financial institutions, helping you grow the number of businesses you serve.
Research providers and find those that can bring your business accounts a suite of services and drive your value proposition as high as possible. There are also opportunities for residual noninterest income, which credit unions can generate with a strong account value of high quality and relevant services for their business members. Hopefully, potential future legislation will pave the way for credit unions to be more aggressive with commercial loans, and therefore, a stronger bond with business accounts can result in expanded loan opportunities and access to all the business’ employees as well. The noninterest income possibilities could also allow your credit union to be more aggressive in lowering loan rates or increasing interest rates on business deposit accounts.
The increasing threats of data breach events at SMBs aren’t going away. Criminals know these small companies are low-hanging fruit and prime for attacks. It is time for credit unions to expand their vision and look at new services to attract these vulnerable SMBs. The benefits of stronger business account offerings to your credit union include an expanded fee income stream, a greater engagement level for long-term dealings and a competitive advantage that will attract more businesses.
Don’t ignore the signs of the times and miss a significant opportunity to better serve and support the life-blood of American growth and prosperity – SMBs.
James McCabe is EVP for Vero. He can be reached at 480-699-2168 or jmccabe@veroproducts.com.