LAS VEGAS -- Looking ahead, NACUSO is putting plans in place to facilitate the development of a new CUSO model built on a more integrated network and aims to quell fighting over capturing business from new credit union signees.
NACUSO General Counsel Guy Messick shared some of the details on how a new CUSO hub will connect a credit union to a CUSO and credit unions with other credit unions. Collaboration solutions will be sought first and only the most effective services and use of the best providers will be permitted. No longer will CUSOs have to scramble to get the attention of new credit union partners because the goal will be all participant business will benefit everyone in the network, he said.
The timing for a new network is critical since the cost to operate credit unions is $28 billion, which Messick described as "a black hole that credit unions have to put money into."
The development of a Web portal will allow network participants to browse provider postings and see peer reviews of those providers. Messick said only credit unions can be involved in the network and users who are not active in supporting the network can be moved out of it.
Fees and capital generated can be used for things like research and development. A sufficient capital base with transaction pricing as well as tiered pricing would be built in. Messick said there will no proprietary rights to intellectual capital and all member information is protected.
Governance of the network will come through a board made up of credit union CEOs. Regarding dispute resolution scenarios that may arise, Messick said there will be internal mediation and arbitration. There would be no indemnification by the network and insurance and bonding would be a requirement.
Messick said this new model, which he describes as CUSO 3.0, is just the next logical phase in CUSO development going back to before 1993 when credit unions informally provided help to each other and leagues. He described this model as CUSO 1.0. Between 1993 and 2001, credit unions formed solely owned CUSOs. The growth of multiowned CUSOs in 2001 and beyond became the CUSO 2.0 phase.