The credit union landscape is changing, and more and more credit unions are developing non-interest income programs and new sources to boost revenue. These programs are providing the best of both worlds to credit unions; additional revenue for the organization and the opportunity to deepen relationships with members.
Non-interest income is income that primarily comes from fees. Credit unions charge a variety of fees including collection, overdraft, skip payment, late, and annual fees. These fees are a way of generating revenue and ensuring liquidity in case default rates increase. Although fees can be solid revenue generating options, it’s critical for credit unions to be member-centric with their non-interest income programs. There are many other non-interest income options that can be derived from different products and services, including annuity products, financial planning services, and insurance.
Credit unions should strive to develop internal programs or partner with companies that will provide member-friendly solutions and benefits. As an organization, it’s important to have a healthy balance of generating enough non-interest income for profitability, while ensuring members are not feeling alienated by fees and still feel the CU cooperative difference. The goal should be to offer members many different options along with a car loan or a home loan that deepen those ties and create security for the member. MemberInsure is a strong solid solution for an additional non-interest income revenue stream.
The MemberInsure program makes a new source of non-interest income easy for credit unions and seamless for members. Our solution is a zero cost startup program that integrates with credit union loan systems, educates front life staff on how to communicate with members, and provides credit union-specific marketing materials. Members are going to get their insurance somewhere, why not offer it through the credit union? MemberInsure’s portfolio of home, auto, life and small business insurance provided through credit unions can be an additional solution to strengthen those relationships. The MemberInsure program provides additional cross-sell opportunities for credit unions and adds value to members.
However credit unions choose to grow non-interest income, it’s imperative to think creatively and long term. As members put more effort into finding the lowest rates and fees, exploring supplemental non-interest income opportunities should be a priority today.