CHICAGO — Embraced in other countries, an innovative account that pools all of a member's accounts including savings, loans, mortgage, checking and credit cards into one account recently moved one step closer to implementation here in the United States.
Members of the Filene Research Institute's i3 team, NACUSO, PSCU Financial Services and others met on Feb. 27 in Chicago to discuss how to bring the Flex.One account to U.S. credit unions. The account is a first mortgage combined into a home equity line of credit with all the capabilities of a checking account. The member's entire loan is a line of credit, which allows loan payments and savings withdrawals. It also allows access via ATM, check, debit card, point of sale, ACH and other features that aim to make a separate checking account unneeded.
"It was a great opportunity for Filene and NACUSO. It was collaboration at work," said Denise Gabel, chief innovation officer at Filene. "We're talking about a 2005 idea that was incubated in Filene i3 and how we could work together to bring it to life and to households across the United States."
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The Flex.One concept is based upon an innovation begun in 1997 at the Royal Bank of Scotland, which has since established 800,000 accounts. Until 2005, Flex.One was largely a European and Australian model, according to Filene. Then, San Diego-based Pacific Trust Bank launched its Green Account, and Envision Credit Union implemented the Redfrog account in Canada.
The i3 team is aiming to implement the Flex.One in phases so that credit unions can add particular features as markets demand and technology allows. Implementation would begin by introducing the one account structure and then integrating layers. For example, back office integration would increase to allow manual and then automatic flow between accounts.
Rollout of the account aims to start with the "Hyper HELOC," which introduces Flex.One by combining a standard HELOC with a first mortgage and allowing the member to manually sweep between these and a direct-deposit account. Phase one would allow automated sweeping between accounts and the ability to direct deposit into either the direct deposit account or the HELOC. Phase two builds on these concepts by providing the member with a single view of the account through technology. Internal credit union tools may still present multiple account views for call center support. The final phase is achieved when the HELOC and direct deposit account integrate into one true account and all transactions post natively into a single account with the data processing system. The back office integrates everything into a single account, and both member and employee views of transactions show one account.
A pilot is in the works to implement Flex.One at a number of credit unions. Gabel and Davis are scheduled to meet on March 20 to discuss this phase in more detail.
Attending the Chicago meeting were Gabel; Jeff Russell, vice president of strategic development and CIO, The Members Group; Kent Sugg, manager of member services, Tinker Federal Credit Union and implementation driver at Filene; Tom Davis, president/CEO of NACUSO; Tim McAlpine, president and chief strategist, Currency Marketing; John Pembroke, chief marketing officer, PSCU Financial; and Maureen Maddox, implementation driver at Filene.
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