Innovation Credit Union (50,000 members, $2.2 billion in assets) has given new meaning to the term “mobile banking.” While financial institutions have put the collective brakes on bricks and mortar-based services, favouring online delivery for daily banking needs, the Saskatchewan credit union has gone pedal to the metal — literally. Innovation has added wheels to its mobile strategy.
As more and more small Canadian communities find themselves without a bricks and mortar bank due to the shuttering of branches, Innovation has discovered an efficient and cost-effective way to bridge the gap for those in need of community-based services. “We were getting requests to build more branches but we’re not in the business of building branches,” says CEO Daniel Johnson. “We’ve reached the number of physical locations we’re going to have.”
Central 1 Summit’s theme is Momentum – Mobile banking is just one of many forward-thinking topics to be covered at Momentum 2017: Annual Summit for Credit Union Leaders. Hosted by Central 1, the summit is being held at the Westin Bayshore in Vancouver, April 26-27. The AGM will be held April 28. Check out the website, www.momentum2017.ca, to learn more and register to attend.
Innovation is, however, in the business of serving customers — wherever they may be. And, true to its name, its solution to meeting face-to-face banking needs in communities without a local branch is both innovative and unique: a travelling mobile bank for motoring around the province. Its Mobile Advice Centre (MAC), which launched last year, is housed in a semi-trailer truck that commutes to communities in need of local financial services. “While people are doing more business digitally, some members need a certain level of service,” says Johnson. “This is an option for members to do that.”
The MAC houses an ATM as well as a live video connection to in-branch tellers. It travels to under-served communities in northern Saskatchewan, particularly those that have lost a branch or requested one. “We’ll spend a day in a northern location, or we may hit two in one day,” says Johnson. “We’ve had a very busy schedule.” Staffed by Innovation team members from various locations, the MAC serves customers in need of complex financial services like mortgages and loans, as well as those who aren’t yet comfortable with online banking for their daily transactions. A secure wireless connection enables staff to do demos and process transactions directly from the truck. “Our goal is also to get people comfortable doing business in the digital space,” Johnson says.
According to the Canadian Bankers Association, 55 percent of Canadians are doing most of their banking online while 31 percent of Canadians are using their smartphones to check balances, move money, pay bills and deposit cheques, up from just five percent in 2010. But not everyone is comfortable with online banking, Johnson adds. “More mature generations still prefer to pay bills physically.” And when it comes to complex financial services, it’s generally more suitable to do business in person.
“We were worried members would think that it seems expensive but we’ve gotten positive comments” – Daniel Johnson
Johnson says the response to the MAC has been overwhelmingly positive, especially in communities that have requested a branch. “We were worried members would think that it seems expensive but we’ve gotten positive comments,” he says. “People have told us it’s a great idea.” In addition to its community service role, the MAC also participates in trade shows, parades and fairs. “It’s been great for creating brand awareness and presence,” Johnson says. It also plays a critical role in disaster recovery planning and business continuity. “If a disaster strikes, we can bring the mobile branch into the community to help it get back up and running,” Johnson adds. “We’ve even offered it to peer credit unions in the province and in neighbouring provinces.”
For Innovation, this is what future expansion now looks like. The MAC has enabled the credit union
to serve half a dozen communities for a quarter of the cost of building a physical branch. “This is a long-term viable option and response to the evolution of consumer behaviour. People are doing more banking on their smartphone and it’s putting a strain on physical locations. We have to have an efficient number of locations but we can augment that with the MAC,” Johnson says. “We’ve already sent our business case to 10 other credit unions looking at the same concept.” ◊