Taking advantage of a need and the season, a few years ago, the $961 million Cheyenne, Wyo.-based Blue Federal Credit Union introduced a holiday loan program that worked almost too well.
The terms required no credit check, membership for at least 90 days, a $1,200 maximum and a 12-month term. "We greatly underestimated the popularity of this product," Blue FCU COO Andrew Shaw, said. "Members loved it, but it soon became an operational nightmare for us."
According to the credit union, initially, members needed to visit a branch to request the holiday loan. The slow process resulted in unhappy members waiting in the branch for longer than expected. As it had done in the past with other antiquated processes, the credit union approached Aurora, Colo.-based technology resource company DaLand Solutions to discuss relieving the program's pain points.
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The collaboration produced a completely automated, self-service process. Members request the loan while logged into online banking, where they receive authentication. The process uses direct deposit as income verification, and electronic signatures to complete the loan application.
"The system we created with DaLand builds the loan, funds it, and deposits the money into the member's account automatically," Shaw said. "As long as the member has direct deposit, they could have the money in their account in as little as five to 10 minutes."
"Blue FCU is the ideal partner for us," said DaLand Solutions Co-Founder Dan Micale. "They're progressive and they're committed to pushing technology as far as possible to benefit both members and employees."
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Roy Urrico
Roy W. Urrico specializes in articles about financial technology and services for Credit Union Times, as well as ghostwriting, copywriting, and case studies. Also: writer/editor of a semi-annual newsletter for Association for Financial Technology since 1997 and history projects funded by the U.S Interior Department, National Park Service and Warren County (N.Y.).
