Consistency in the Chaos
There's a constant need for consistency. Just don't count on it.
I know, those two sentences are filled with redundancies and political flip-flopping. And that's part of the point – our industry strives to create processes and nice packages of services for members and potential members. But while that's going on, there's an entire group of very smart and extremely wealthy people who keep throwing a technology wrench in your plans.
Think of it like this: Credit unions look to lawmakers and governing bodies for guidance when it comes to new regulations, deleting old regulations and helping the industry evolve as “it's supposed to and as it has” for generations before us. But this generation is dealing with Silicon Valley – something previous generations never had to consider, keep an eye on or worry about.
Inside a recent article in Inc. Magazine, a phrase really hit me in the brain and has been slithering around inside like a water moccasin skimming across a shallow stream. The phrase is only four words and it's a gut-puncher: “Silicon Valley is coming.”
The following sentence wasn't any more comforting to read. “There are hundreds of startups with a lot of brains and money working on various alternatives to traditional banking.”
Let's put this into a broader perspective: The financial system (credit unions, banks, community banks, grandparents with empty ice cream containers full of cash in the freezer) have been disrupted and will continue to be until someone with a lot of money and resources figures out how to fully get around the regulations. Even the huge banks are panicking. For instance, you’re probably familiar with Venmo or the Square Cash app, right? You know, you connect your debit/credit card and send people money without any service/transaction fees. Bank of America is now running national commercials promoting that new, easy feature on their banking app. So, that tells me that even the bigger players are playing catch up with the startups. Because those money-transfer apps have been around for a couple of years. It's similar to the launch and eventual embracing of social media in the credit union industry. That stuff came out in 2006-ish and it took the FFIEC another seven years to come out with any sort of regulatory guidance for credit unions. Basically credit unions were in a holding pattern for more than half a decade.
Admit it, the phrase, “Back in my day …” never worked on you as a kid when your parents started a sentence like that. As soon as you heard those words, it was a cue to instantly tune out and start thinking about who you should ask to homecoming or wonder how many Bugles you can fit on the ends of your fingers. My personal best: 29.
We should rethink that kind of conversation to be something more like, “Do you know what scares me?” That’ll get their (your kids and employees) attention. I’ve learned this as a parent to teenagers/college students – let's talk about what scares us. You’ll never go wrong and you’ll have some of the best conversations.
What scares me is that the disruptive forces here and in other areas aren't really disruptive anymore – they’re the standard way of doing business.
For instance, accountants in Africa are being asked officially by the state minister of finance to “embrace disruptive technology” so they can become more efficient.
When does the disruption become the norm? I mean, come on. How many more times do we have to boringly call Amazon a disruptor? That's what they do and they do it successfully most of the time. They’ve disrupted bookstores, grocery stores … basically every store in your hometown has been disrupted by Amazon and now, it's just normal. Make no mistake that Amazon will do the same to credit unions in full-blown Amazon Prime fashion within the next few years. You want a captive membership? That's what Amazon has.
Puerto Rico Update
To be blunt, this beautiful island full of wonderful people and credit union employees need your damn help. Hurricane Maria was the literal definition of a disaster for our credit union friends, their families and credit union members. I’ve had the pleasure of speaking with all Puerto Rican credit union CEOs at an event a few years ago in San Juan. And I got a good grasp of just how genuinely wonderful these credit unions are for the communities on the island. I know Texas, Louisiana and Florida have all been hit terribly hard by this hurricane season. I just want you, no, I’m asking you to do what you can for our credit union family in Puerto Rico. Maria was a true devastation and it's going to take years to begin to recover. Please do your part as a cooperative helping cooperatives and donate anything you can to one of these organizations:
Direct Relief: secure.directrelief.org
Convoy of Hope: convoyofhope.org
These organizations are rated as high as you can get when it comes to reputable charities making sure the money gets to where it needs to go. They are also exclusively helping those in Puerto Rico in attempts to get back to some level of a normal life.
As of this writing, there's been a lot of confusion about credit union relief efforts for the island. Check in with CUAid.coop regularly and WOCCU as they are attempting to set up emergency funding. Right now credit unions in Puerto Rico can apply for assistance, but guess what? They can't because they don't know about it and/or they don't have electricity to fill out an application and/or credit union officials there are busy trying to find food and water for their families. It's a terrible situation and it's going to be a very long time before normal is even a word we can use to characterize life on the island. Give what you can and, as one credit union CEO said, “Pray for us!”
Michael Ogden is the Executive Editor at Credit Unions Times. He can be reached at email@example.com.