A $500M+ Credit Union’s Successful Auto Refinance Campaign During the Pandemic

auto-refinance

44% of U.S. adults rely on car loans to finance their vehicle purchases. The direct and indirect auto loans they obtain through car dealers provide credit unions with a valuable stream of new members.

When the coronavirus pandemic unfolded this spring, many credit union members were hit with unexpected and immediate financial stress. And for those who weren’t, uncertainty loomed in the future. A MN based credit union, with $517M in assets and 45K members, determined that an offer to refinance auto loans would provide members great value during a stressful time. Refinancing would offer a measure of financial relief, particularly if they were paying higher rates to other institutions.

Even more, the benefits would extend beyond providing financial help to members. This credit union recognized the opportunity to:

  • Initiate a meaningful engagement with auto loan holders.
  • Convert indirect auto loan members to more loyal, long-term members.
  • Better retain members by uncovering their unmet product needs
  • More effectively manage the member lifecycle.
  • Identify the top candidates for new auto loans, increasing the longevity of member relationships.

But how could they wisely target this offer?

The credit union enlisted CU Rise to employ its Cross Sell Engine to mine transaction data. CU Rise identified auto installment payments that were made to other financial institutions, and with further analysis, determined the time left until loan maturity date. When this data was combined with other key metrics, it identified the precise 7% of the member population that was best-suited for an auto refinance offer.

Three months after launching the campaign, CU Rise measured the results.  The response rate in the target 7% population was 1.5 times higher than the rest of the credit union membership. And the positive results didn’t end there.

Click below to see the full results!

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