X

Thank you for sharing!

Your article was successfully shared with the contacts you provided.

<p>WASHINGTON TOWNSHIP, N.J. – Does the term “credit union” scare away some potential members or SEGs? Is it too confusing for today’s financial marketplace? These are some of the questions being raised by Paragon FCU President/CEO Richard Rays. In a letter sent to the CEOs of major credit union trade associations, Rays floats a couple of alternative terms for “credit union.” They include Cooperative Association, Financial Association, and Financial Cooperative. Rays believes that in cases where potential members or SEGs are not familiar with credit unions, the term “union” can hurt the CU’s chances of signing them up. “Just having the word `union’ in the name can scare the dickens out of management. They don’t even like to use that word,” said Rays. Rays said the obvious answer is to educate these potential members and SEGs about what a credit union is, but he said despite educational attempts, the initial contact is often unfavorable because of their beliefs going in. He said more people are familiar with the term “cooperative” and including that in the name may give CUs a better chance in bringing on new SEGs and members. It will be easier for CUs to convey their tax status as not-for-profit with cooperative in their name, said Rays. “Most consumers aren’t aware of the tax status of credit unions. Cooperatives are something people can identify with,” said Rays. Middle and upper management in particular may be scared off by “union” said Rays. “A lot of it is just perception, but many times you can’t get some of the higher-ups in the organization to join a credit union. We have a lot of organizations that are union-shops, but there are a lot of other places that don’t want anything to do with a union. They see it as someone wanting to come in and organize their shop. They don’t even want to talk to you.” He also believes that “union” connotes an “exclusive” group, whereas “cooperative’ connotes an “inclusive” group. “We certainly don’t want to give the perception of being exclusive financial institutions going forward,” said Rays. Rays hopes one of the trades will look into this issue. “Maybe some committee at NAFCU or CUNA can pick up the ball and run with this.” Rays is mostly taking issue with the term “union,” but some say the term “credit” also has negative connotations. [email protected]</p>

Complete your profile to continue reading and get FREE access to CUTimes.com, part of your ALM digital membership.

Your access to unlimited CUTimes.com content isn’t changing.
Once you are an ALM digital member, you’ll receive:

  • Critical CUTimes.com information including comprehensive product and service provider listings via the Marketplace Directory, CU Careers, resources from industry leaders, webcasts, and breaking news, analysis and more with our informative Newsletters.
  • Exclusive discounts on ALM and CU Times events.
  • Access to other award-winning ALM websites including Law.com and GlobeSt.com.

Already have an account?

 

Credit Union Times

Join Credit Union Times

Don’t miss crucial strategic and tactical information necessary to run your institution and better serve your members. Join Credit Union Times now!

  • Free unlimited access to Credit Union Times' trusted and independent team of experts for extensive industry news, conference coverage, people features, statistical analysis, and regulation and technology updates.
  • Exclusive discounts on ALM and Credit Union Times events.
  • Access to other award-winning ALM websites including TreasuryandRisk.com and Law.com.

Already have an account? Sign In Now
Join Credit Union Times
Live Chat

Copyright © 2022 ALM Media Properties, LLC. All Rights Reserved.