Strengthening Communities & CUs: A Holistic Approach to Community Involvement

By their nature, credit unions are unique to the financial services industry. Born out of the very essence of community and the “people-helping-people” movement, the idea to form credit unions began when individuals realized banks couldn’t provide the necessary resources to support their financial goals.

Foundationally, at the heart of every credit union should be the intrinsic need to lend a helping hand to our fellow humans, whether through supporting members’ financial aspirations or, more broadly, giving local charities and causes a boost to fulfill their life-changing missions.

Devising a Community Relations Strategy

Supporting your local community doesn’t just mean writing a check to a local charity. There’s a strategic approach to building a community relations program – one that not only inspires your team but one that changes lives.

Determining which local charities and causes you support should always align with your credit union’s internal goals and values. At Members Choice Credit Union, for instance, we’ve chosen to support several health care and social services organizations because their causes run parallel to our internal belief system and what we represent. Equally as important is supporting local sports teams and other local events and activities. In our area, for example, the various livestock shows and rodeos are iconic events that play a vital role in the region’s culture and heritage. (After all, we are based in Texas!)

You must also carefully consider your approach when establishing relationships in your local community. Beyond understanding cultural nuances, you also need to consider the type and size of the market.

If your credit union is primarily suburban or rural, it may be best to embed yourself into the community you serve first and become active in local events. By taking your time, getting to know people and understanding the local community’s work, you will eventually be seen as a partner, not someone who is overstepping their bounds. Then, once you have developed some relationships, choose which community initiatives to support. Often in smaller communities, it’s about more than just the money.

On the other hand, if your credit union is based in a larger metro area, you may not be able to compete with the larger companies, limiting your involvement to a few key charities. By researching their key events and activities, you can determine how to give these charities a lift that will make the most significant impact with limited resources.

To execute a meaningful community involvement program, getting buy-in and participation from your team is imperative. An essential part of this is hiring people who value taking care of their local communities, who desire to give back and who derive a sense of fulfillment from helping others.

How Community Involvement Bolsters Membership

It goes without saying that building the trust and loyalty of members is vital to sustaining a credit union’s business.

When members see how your credit union is genuinely supporting the local community, it has the potential to foster a sense of pride, reinforcing the idea that credit unions are not just financial institutions but partners in the well-being of the members and the communities they serve. On the same token, community involvement also has the potential to attract new members to your credit union when they see you supporting treasured causes or hear about your support from their friends and family.

In addition to fostering trust, implementing a community relations strategy can also help credit unions keep a pulse on the needs of their members and prospective ones. By attending and supporting causes aligning with your values and actively listening, you can discover what products or services are most needed and how your credit union can create innovative solutions to fulfill those needs.

Community Involvement Is Not Business Development

One of the biggest mistakes a credit union can make when implementing a community involvement program is to include it in the business development strategy. When they do so, credit unions risk creating a false impression, harming their reputations, and eroding members’ trust and that of the community. You may appear inauthentic, driven solely by the desire to increase profits or gain new members.

Along the same lines, it’s essential to remember how you communicate messages to your members and the public about your community involvement initiatives. When giving back to local organizations, be mindful about not using that involvement as a political tool, as it might send the message that your institution is taking a political position that will alienate certain groups. Stay close you your roots, do banking great and leave politics to the politicians.

Credit unions should strive to be transparent, commit to genuine community betterment, and establish clear communication of their motivations and activities to avoid creating a false impression when blending community involvement and business development. The key is to ensure that community involvement efforts are guided by a sincere desire to benefit the community rather than simply being a means to drive profits or enhance the credit union’s image.

That said, community involvement and business development are not necessarily mutually exclusive. They can and should complement each other in a balanced and ethical manner. For example, a credit union can use community involvement to demonstrate its commitment to the community and attract new members. Still, the primary goal of community involvement should always be the betterment of the community, not just as a means to drive profits.

Earn Like a Bank So You Can Act Like a Credit Union

If you adopt the mindset of “earning like a bank so you can act like a credit union” and institute operational efficiencies across the board, you will be able to give back more to the local community. Doing so can be challenging, especially during times of margin compression; however, your organization has the potential to positively impact lives, which is why credit unions exist in the first place.

While credit unions must be financially viable and competitive, their primary focus should always be serving their members and communities. This doesn’t mean that credit unions cannot be economically successful; it just means our definition of success should be aligned with cooperative principles, operating in the best interest of its members and the community at large.

Luke Billeri is President/CEO of the $777 million Members Choice Credit Union in Houston, Texas.