Shrinking the "Web" gap between large and small credit unions

WASHINGTON -CUNA Mutual is looking to shrink the considerable "Web" gap that exists between large and small credit unions. A Commerce Department report, "Falling through the Net" highlighted the gap in Net access between high and low-income Americans. The report basically concluded that the higher the income, the more likely a person is to have access to the Net. A similar situation exists in the credit union industry. A scant 1% of credit unions with $10 million or less in assets have a Web presence. Moving up the asset ladder, just 20% of CUs with assets between $10 and $20 million have a Web site. These numbers are particularly disturbing given the fact that small credit unions dominate the industry in terms of number of CUs. Approximately 8,300 of the industry's 10,628 CUs have assets under $20 million. Although these CUs only make up about 20% of the industry's $411 billion in assets, they do serve approximately 15 million members-that's millions of members who can't visit their CU on the Web. Couple that with recent research done by PSI Global, Tampa, Fla., which found that credit union members are more Net savvy than non-members, and the lack of small CUs on the Web looks even more troublesome. CUNA Mutual announced a program that it believes can bring more small CUs to the Web by eliminating one of the biggest barriers they face-cost. Known as the Small Credit Union Technology Package, CUNA Mutual struck a deal with Compaq Computers to not only provide small CUs with quality PCs, but to help these CUs develop a Web presence. Looking at the PC package first, small CUs can obtain Compaq's Prosignia 320 for just $999 and the Prosignia 330 for just $1,342-both prices are significantly below market price. The PCs come complete with monitors, which these days are often the most costly components of a PC. The machines feature an impressive package of software that can bring some instant Web functionality and business sophistication to a small CU. The PCs are preloaded with Microsoft Office 2000 Small Business Suite of software, which features Word, Excel, Publisher 2000, Business Planner, Direct Mail Planner, Small Business Manager, Small Business Financial Manager and a training program. Internet Explorer is preloaded and the PCs have built-in Fax Modems and 30 days of free Internet access. But it's in the area of Web access and Web site development where the program provides significant cost savings to small CUs. Compaq.net will build a CU's site for free and charge about $7 a month to host the site and another $12 a month to offer the CU Internet access. Steve Goldberg, CUNA Mutual's vice president of Small Credit Union Development, said small CUs face the same competitive pressures as larger CUs and the industry should take steps to help bring small CUs to the Web. "Some small credit unions have told us that because they're small they need to have a Web site. So far the only way a small credit union can develop a Web site is with $2,500 or more in upfront cost," said Goldberg. He said with that amount of cost, small CUs have had trouble convincing their boards a Web site is worth it. Another component of CUNA Mutual's program is a dedicated small credit union Web site, www.smallcu.com. The site is basically a portal dedicated to the needs of small CUs. For example, there are pages dedicated to helping small CUs with lending. CUNA Mutual culled some information from recent reports on small CUs that have successful lending operations and condensed it into a few pages. "It's an executive summary of a larger manual. It's geared entirely to the points raised in Filene's research on key ingredients to successful small CUs," said Goldberg, who noted that these types of components can make the site a true operations resource for small CUs. The smallcu.com site is preloaded on the Compaq PCs. It features links to a plethora of credit union organizations and vendors. Goldberg noted that a number of state leagues have agreed to help promote the program to their small CUs. For CUs that want to learn more about the low-cost PCs, they can call 888-228-9652 (pass code is CUPC), or place an order at www.smallcu.com. -pgentile@cutimes.com