Let's Talk About Money

by Greg Crandell

[Editor's Note -- Ron Daly is off for the week, so Greg Crandell, DigitalMailer's Executive Vice President, is stepping in for a guest post.]

I'm certain my kids are going to cringe if ever they read this, but I'd be remiss if I didn't start out with this phrase. 

IN MY DAY...people didn't talk about how much money they were making or what they were doing with it. The most chatter that went on about a person's money matters happened when your neighbor drove home with a new boat dragging behind the car. Hopefully on a trailer, because there's no faster way to ruin a boat than by dragging it down a rough street. 

But the times, they are a'changin', as they so often do. People are becoming more open, sharing their thoughts via Twitter, their home movies via YouTube, their hobbies over Etsy and their...well, everything via Facebook. Facebook surpassed Google in total visits to its homepage a few weeks ago and, as CNBC says, it's "a sign that the web is becoming more sociable than searchable".

Even as the world wide web begins to bring people even closer together, online banking becomes a greater part of people's finance management. Of course those realms are going to overlap, but to what effect? 

What WON'T You Collaborate On?

by Ron Daly 

Last Wednesday was a great day for those of us here on the East Coast. After months of snow and sleet and cold, we were treated to a mild, cloudy day and a visit from our fellow credit union service organizations at the NACUSO regional meeting. And what a visit it was. 

We met a lot of great folks last week who had a lot to say about CUSOs and the current "credit union economy". Following up from last Tuesday's Blog Post, NACUSO CEO Tom Davis kicked things off with a quick view of the industry and word on butterflies. "Butterflies?" You ask. Yes, butterflies. According to Tom's talk, when butterflies leave the cocoon they have to struggle to break free and fly off. If you help one out of its cocoon, it won't have to struggle - but it can't fly. I think that's a pretty good analogy, and a great thing to keep in mind when the going gets tough. 

Buy the Cow, OR Just the Milk!

by Ron Daly 

Let's pretend for just a moment that you run a credit union (and you might). Your credit union can offer checking and savings and loans, but has no online banking, no student lending program, and a weak collection strategy. "Just doing" these programs isn't in the cards, given your membership size and available capital, but doing without them will surely cost you future members and won't let you compete with the mega-bank down the street. What do you do? 

If "use a CUSO" didn't cross your mind, you're sadly not alone. 

In a recent article from CU Journal, Tom Davis, CEO of the National Association of CUSOs (NACUSO), expressed his frustration with credit unions' unwillingness to invest in CUSOs. 

From the article: 

"Why think about joining a multi-owned CUSO in the first place?" Davis asked rhetorically. "Because it will help sustain the credit union. It will drive value to the credit union's members. It spreads risk among multiple credit unions. It adds expertise. We need to point out the advantages, specifically driving value back to the members, which is why we are here. Putting my NACUSO hat on, that is what we are all about...we provide applied learning experiences on the value of collaboration."

Tom has some great reasons for investing in a CUSO and collaboration. The article is worth the read. But here's a question that hasn't been asked yet, and I'm going to be bold and put this out there: 

Why not just BUY from a CUSO? 

I can appreciate why a credit union would buy into a CUSO so they'd have a stake in its success, add value to the CU, and obtain owner pricing. But if what you need is a service and what that CUSO is providing is the exact service you need, just buy the product from the CUSO! You don't always need to invest in the CUSO to become a part of it, you just need to use their products and services. 

I put my CUSO (DigitalMailer) out there as an example. We're the 2nd largest eStatement provider in the industry, our email engine is designed to help you maximize your online marketing ROI, and we're used by 180 credit unions nationwide. When it's down to two, if you have the choice between an industry outsider or someone with ten years experience in financial services, why choose the former? 

 Put simply: When it comes to CUSOs, you can buy the cow and get the milk or you can just buy the milk. All things being equal, when considering a vendor, we encourage you to buy CUSO. 

As always, your comments are appreciated. 

HAMP Hampered

by Ron Daly 

The successes of President Obama's financial programs have been debated by pundits for the past year or so. Some say that progress is naturally slow in recovery and that the seeds of these initiatives will bear fruit for years to come. Others say that the programs have not helped enough in the short term to warrant their continued support. 

One program being debated currently is the Home Affordable Mortgage Program, or HAMP. A recent story from ABC News talks about the program - its proponents, its opponents, and its short-term success. 

Watch the video below. [EMAIL READERS - please visit the website to view the video. Flash player required.]

According to the online version of the story, only 116,000 homeowners have taken advantage of the $75 Billion program thusfar. Only 116,000 on a program designed to help 2 million? Why? Because bankers won't help customers and would rather foreclose. This has led some lawmakers to call the program a "failure" and has prompted the Treasury to suggest a stronger hand. If the Treasury and the Obama Administration had their druthers, banks would be required to see if homeowners qualified for HAMP help prior to foreclosure. Banks would only be allowed to begin the foreclosure process after a borrower had been officially unqualified.