Gen Y is going to be spending $2.45 trillion annually by 2015, and credit unions that want a piece of the pie will have to look at their lending product offerings to see whether they match young people's needs and expectations.
That was the message from Shelly Vils, senior manager of credit union training at CUNA Mutual, during her session on lending to Gen Y at the online Discovery conference on Wednesday.
Vils said credit unions don't have to necessarily create new products and services to serve Gen Y--they can repackage an existing loan in a new way to appeal to young people.
For example, she said one credit union she worked with had great success offering a "moving out loan," which was essentially an unsecured line of credit up to $1,000 with a similar interest rate to the CU's other unsecured loans. Although it was simply an old product with a new name, the loan was a hit because it was marketed to be relevant to a Gen Y life event.
Credit unions interested in attracting young people should familiarize themselves with the unique characteristics of Gen Y and tailor their products accordingly, Vils said. For example, she suggested that CUs tap into young people's desire for advice and guidance by pairing loans with a financial literacy program that educates them on improving their credit score and financial planning.
She also advised that CUs offer the classes virtually to be more convenient to young people and recommended rewarding them with a rate discount for completing three to five sessions.