HOBOKEN, N.J. — Eight years ago credit unions were hoping to get the jump on banks in the Internet world as a study showed that most banks still hadn't fully embraced the World Wide Web.
The front page story (CU Times, July 19, 2000) cited a study from the Office of the Comptroller of the Currency and the TowerGroup that showed at the time of the10,000 or so FDIC-insured banks and thrifts, approximately 7,800 still did not have a Web site. Of the 2,200 banks that did have a Web site 1,100 had no more than what was called "brochure-ware." Of the top 100 banks, 777 offered no transaction functionality on their sites and 36 of them had no Web presence at all.
Data from Callahan and Associates said that 2,814 credit unions had a Web presence, and 691 of those Web sites offered Internet banking. Richard Bell, director of e-banking research at TowerGroup said that First Technology Credit Union had one of the best transactions sites out of all financials.
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In 2000, looking ahead to the future, the study did predict that banks spending on Internet services would grow to over $2 billion in the next five years.
Reaching the underserved and unbanked market was an issue high on the credit union radar even eight years ago as Bethex Federal Credit Union did what many thought was unthinkable–it partnered with a check cashing service. President of the Bronx, N.Y., credit union Joy Cousminer started a partnership with Joe Coleman, president/owner of Rite Check Cashing.
Both were members of the NYCE ATM network, which made the partnership possible. The pilot plan was for the check casher to provide forms and information to open credit union accounts and offer assistance filling out the forms. The check cashers would act only as facilitators, and the credit unions would pay a fee for each successfully opened account or loan. At the time, a marketing plan was being developed that would make Bethex marketing materials available to customers when they entered a check cashing outlet. Together Cousminer and Coleman hoped to provide a way for credit unions to reach the unbanked and to turn them into members.
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