Credit Unions: Building bridges across the Atlantic
05 Apr 18
CEO of One Detroit Credit Union, Hank Hubbard visited Enterprise Credit Union (ECU) in Liverpool.
Hank made the journey to the UK for the 2018 ABCUL AGM conference in Manchester, and everybody at ECU were delighted to be able to spend time with Hank - both in Manchester, and with us at ECU in Liverpool, along with colleagues from Riverside Credit Union, Hoot Credit Union, and South Manchester Credit Union.
The visit comes a couple of years after ECU visited Detroit in 2014, as part of a shared knowledge initiative between credit unions in the UK and the USA. ECU CEO, Karen Bennett, along with colleagues from ABCUL and other credit unions were able to experience the extent to which One Detroit Credit Union and other Community Development credit unions in the US are dedicated to improving the financial welfare of their local communities.
Four years on, ECU was thrilled to be able to speak to Hank again, to share and discuss our mutual plans for the future. Karen Bennett (KB) sat down with Hank Hubbard (HH) to discuss highlights from his trip to the UK, the valuable partnership between US and UK credit unions and what they can both learn from each other.
Here’s how it went:
KB: Hank, firstly thanks for coming to see us here at Enterprise. We hope you enjoyed the ABCUL AGM and share our optimism about the future. What would you say are the key takeaways from the conference?
HH: I've been lucky to be able to experience the credit union movement in several countries. The first thing I notice is that the regulations limit credit unions in different ways everywhere I go. We all have the same share accounts and small loans at our core, how the products and services evolve from there becomes the difference.
The thing that is really consistent is the philosophy of people helping people. That is something that is inspiring and rejuvenating to be reminded of. It's easy to let the day to day grind distract us, and trips like this tend to bring back the focus for me.
KB: The great thing about the credit union movement is that those working in the industry can work together cooperatively, sharing ideas in order to impact positively on financial inclusion. Has it been valuable to see a different way of working from us in the UK?
HH: Yes, absolutely. I'll give you some examples. Your loans are often a multiple of shares, we don't do that and it makes me think of our process from a different perspective. We are often trying to find ways to encourage a savings habit - and I'm wondering if we can learn from your example.
I was really struck by the fact that you process thousands of loan applications in a month. The ones I saw were hand written with budgets attached. We do about 900 in a busy month, and while we do some counselling - it doesn't usually include a budget. I think we can learn quite a bit from each other on improving our processes.
KB: What could UK credit unions learn from our counterparts in the USA?
HH: In general, US credit unions have a much wider array of products and services than UK credit unions. Whether that's good is up for debate, but UK credit unions are clearly considering trying new products and services. You can gain inspiration for some of the things we do, and you can also get insight from our debates over the merits of the services many of us offer.
For example: Courtesy Pay. US credit unions often offer checking accounts (I think you call them current accounts); if a transaction comes through and the funds aren't available we traditionally send the transaction back and charge a NSF (Non-sufficient funds) fee. Courtesy pay is where we will pay the transaction, taking the account negative, while still charging the fee. We offer this service and believe in it, and one of my colleagues at the ABCUL conference from the US strongly believes that this product is not good for members and advocates against it. Listening in on our debates can help inform your choices as you consider new things.
KB: What do you think is the biggest challenge we face as a global movement at the moment?
HH: I think its sustainability. Like us, you appear to be seeing consolidation happen and many smaller institutions are going away. I was able to attend a breakout session at the ABCUL conference about learning from past failures. It was interesting to find that UK credit unions s are seeing consolidation, sometimes from mediocre management, regulation overload, or fraud. This same session could easily have happened and sounded very similar in a US conference. Credit unions our size are challenged with reaching economies of scale, but I don't always think bigger is better. I think we need to be more creative in finding new ways to boost sustainability. These international field trips can help us consider our challenges in new ways.
KB: Recently, Michael Sheen founded the End High Cost Credit Alliance (EHCC). What do you think the impact of celebrities such as Michael will have on our plight to spread awareness of credit unions?
HH: Endorsements such as this are invaluable moving forward. As you mentioned in your previous blog, one of the biggest challenges we face at the moment is raising awareness, so to have a public figurehead such as Michael involved is absolutely fantastic.
KB: Thanks Hank!
On a personal note, ECU would like to thank Hank for coming to see us and for his valuable insight into what we’re doing here in the UK. It was fantastic to show him how far credit unions have come in the UK. The future is certainly bright.