SELCO Debuts New Payday Loan Outlet; Serendipitous Timing With Governor's Announcement
EUGENE, Ore. -- Bent on reaching out to young and "less affluent" borrowers with payday alternatives, SELCO Community Credit Union has opened a separate branch-type facility in nearby Springfield to draw new members while soliciting the nontraditional loans.
The new "Lending Outlet," as it is called, is located in a former bank building and was formally opened last week with more such facilities planned for future sites in the 11-branch SELCO market of central and western Oregon.
The three-employee facility, which has been on the drawing boards for a year, is being promoted as an innovative approach by a CU to provide a comfortable setting for those borrowers who know little about CUs,
"The Lending Outlet fills a growing need for fast and hassle-free financing among younger and less experienced borrowers," explained CEO Ava Milosevich.
The Lending Outlet will provide traditional types of financing such as auto, consumer and home improvement loans, "but with a twist since we have options for those who might not fit into a traditional mold," explained Kristi Lahtinen, sales manager of the Outlet, which is being made into a separate division of the CU.
The facility, housed in the old Citizens Bank building now owned by the CU, was officially opened June 30 and so far has extended a whopping $485,000 in loans during the first month.
"Our goal was $100,000 so for certain we've found a niche that needs our services," said Bonnie B. Larson, vice president of marketing.
In addition to serving "the retail walk-in borrower," the Outlet staff, said Larson, intends to partner in early 2007 with local home-improvement service provider, carpet, appliance stores and others to direct customers to the Outlet for financing.
The Lending Store is not designed to serve as a branch for existing members "though we will not turn them away," said Larson.
Existing members of the $670 million SELCO will be able to get the CU's current low-interest, payday product called "Quick Draw" at the Outlet. That product has a $500 cap and is offered on a 30-day basis.
Larson said SELCO is using print, direct mail and bus ads to promote the Outlet, but is not using the more expensive TV or radio commercials.
He added that it was sheer coincidence that SELCO announced its program at the same time Gov. Ted Kulongoski was unveiling a statewide Web site and 800 hookup to link potential payday borrowers with CUs.
"It's a serendipitous connection," added Larson. SELCO, it was noted, was one of the early CUs to provide alternative products in line with the state's program of leaning on CUs to offer them.