CU Rise Analytics https://cu-rise.com Thu, 02 Apr 2020 10:09:14 +0000 en-US hourly 1 https://wordpress.org/?v=5.4 Alternative Data Sheds New Light on Alternative Lending for Credit Unions https://cu-rise.com/apps/blog/entries/show/alternative-data-sheds-new-light-on-alternative-lending-for-credit-unions https://cu-rise.com/apps/blog/entries/show/alternative-data-sheds-new-light-on-alternative-lending-for-credit-unions#respond Thu, 02 Apr 2020 08:39:47 +0000 https://cu-rise.com/?p=6701 The post Alternative Data Sheds New Light on Alternative Lending for Credit Unions appeared first on CU Rise Analytics.

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Consumers needing a loan, resort to conventional lending products through traditional financial institutions. But what happens to them when FIs evaluate these prospects as risky? They resort to alternative loans from non-bank lenders.  In today’s trying times with a rapid spread of pandemic, more and more consumers are facing financial difficulties and will need funds. The market for alternative loans is bound to grow in coming months.

Like other traditional lending institutions, credit unions also offer few alternative products to members who for various reasons, don’t qualify for conventional loans. Most see the proposition as too risky. But, armed with the right information, it becomes clearer that the perceived risk is obscuring real rewards – for both CUs and their members.

Tapping into an Underserved Market

Often demographic, member account, and bureau data dominate lending decisions – and historically, this approach served Chief Lending Officers well. But today, this traditional approach is outdated, and may be automatically filtering out sound opportunities.

There’s a large segment of people whose credit needs are unfulfilled because they don’t meet the criteria for traditional lending products. This population of potential borrowers often consists of millennials, new graduates with little employment history, migrants with secured jobs, inactive cardholders or anyone lacking debt/ borrowing history. People with “thin” credit files represent about 20% of borrowers, and they are often unbanked or underbanked.

For these individuals, alternative lending products such as payday loans or short-term small and medium personal loans represent a vital financial lifeline. But credit unions have little that can meet their needs.

For CUs that want to reach untapped segments of borrowers, a world of alternative data is emerging that offers rich and undiscovered insights. CUs can more safely extend credit and provide a second chance to these underserved financial consumers.

Using an Alternative  Data-Driven Approach

Alternative data can help credit unions look at alternative lending from a new perspective. CU Rise analysis has shown many credit unions are rejecting loan applications that could become new revenue sources with a risk-managed approach. Underwriting and pricing policies can be made more rigorous and effective when backed by analytical data.

An alternative data analytics-driven approach harnesses unconventional data sources for a more holistic assessment of credit-worthiness. In addition to traditional credit bureau reports, valuable information can be gleaned from sources like mobile, ACH, ERIC, Statement, app data, social media, transaction data, and payment data.

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As credit unions continue to modernize and adapt, they can find inspiration and useful practices employed by the fintech community. One such company uses real-time data input by borrowers to build an initial primary profile, capturing information such demographic, bureau, debt purpose, debt transfer, personal financial information and much more when a borrower registers at their website. After registration, ongoing performance data is collected to determine eligibility for subsequent loans.

The traditional lending market is oversaturated and highly competitive. It’s time for credit unions to take a modern and sophisticated approach to new lending opportunities. Don’t limit your potential to iterating new versions of the same old products. Consider how alternative lending can smartly open new doors for you and underserved members.

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CU Rise Team provides continued support to credit unions https://cu-rise.com/apps/blog/entries/show/cu-rise-team-provides-continued-support-to-credit-unions https://cu-rise.com/apps/blog/entries/show/cu-rise-team-provides-continued-support-to-credit-unions#respond Thu, 26 Mar 2020 13:03:12 +0000 https://cu-rise.com/?p=6696 The post CU Rise Team provides continued support to credit unions appeared first on CU Rise Analytics.

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We are with our credit unions even in these tough times. Selfies taken of our team working from home on pressing analyses that impact members. Be responsible and stay safe.

#workingfromhome #analytics #socialdistancing #COVID19

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Amid COVID-19 Fears, Data Analytics Show Credit Unions How To Help https://cu-rise.com/apps/blog/entries/show/amid-covid-19-fears-data-analytics-show-credit-unions-how-to-help https://cu-rise.com/apps/blog/entries/show/amid-covid-19-fears-data-analytics-show-credit-unions-how-to-help#respond Tue, 24 Mar 2020 08:37:27 +0000 https://cu-rise.com/?p=6682 The post Amid COVID-19 Fears, Data Analytics Show Credit Unions How To Help appeared first on CU Rise Analytics.

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The upended sense of normalcy caused by the COVID-19 global pandemic has generated dramatic changes in consumer spending behavior. CU Rise Analytics conducted a member spend analysis that looked at year-over-year and month-over-month (February to March) spending changes. The analysis suggests that COVID-19 has already had significant impact on purchasing patterns.

Beyond changes in spending, the revised economic outlook has created uncertainty among the American public. The warning signs of economic recession may already be showing up in credit union members’ transactional data, in the form of lower incomes and tightened spending.

So what are the best ways for credit unions to help?

Read more

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New VP of Analytics joins CU Rise Team https://cu-rise.com/apps/blog/entries/show/new-vp-of-analytics-joins-cu-rise-team https://cu-rise.com/apps/blog/entries/show/new-vp-of-analytics-joins-cu-rise-team#respond Tue, 17 Mar 2020 08:47:51 +0000 https://cu-rise.com/?p=6687 The post New VP of Analytics joins CU Rise Team appeared first on CU Rise Analytics.

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VIENNA, VA (March 17, 2020) — Credit union data analytics fintech CU Rise Analytics has added Floyd Salamino to its growing team in the new role of vice president of analytics. The addition brings CU Rise’s total employee count to more than 55 across its global footprint.

Floyd will provide strategic direction to client accounts and help to drive product and market strategies that further CU Rise’s leadership in predictive models, enhanced business intelligence, and custom analytics solutions for credit unions.

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SUPPORTING MEMBERS DURING CORONAVIRUS https://cu-rise.com/apps/blog/entries/show/supporting-members-during-coronavirus https://cu-rise.com/apps/blog/entries/show/supporting-members-during-coronavirus#respond Wed, 11 Mar 2020 13:14:05 +0000 https://cu-rise.com/?p=6655 The post SUPPORTING MEMBERS DURING CORONAVIRUS appeared first on CU Rise Analytics.

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The Coronavirus (COVID-19) has sparked economic fears as the outbreak hits the U.S. It’s an uncertain time for both credit unions and members as the threat of an economic slowdown looms.

Among financial institutions, Credit Unions have the opportunity to shine in times of distress when they demonstrate their caring commitment to the financial health of their members. As concerns mount around health, well-being, and financial stability, these are just a few ways Credit Unions can use data analytics to offer support:

  • More vulnerable members can be offered “skip a pay” to conserve funds and boost confidence.
  • Members with downward trends in income can be offered hardship assistance, particularly in industry sectors already being affected like travel and tourism.
  • CUs can identify members that are experiencing increased healthcare costs and offer 0% promotional rates for medical and prescription transactions on credit cards.
  • Credit unions can proactively offer loan refinancing to members with high debt repayment and lower deposits.
  • Remind members to use online banking services minimizing their need to physically step into a branch for basic transactions.

Challenging circumstances can remind us that mission-driven member service is always a win-win. Not too long ago, a CU Rise credit union client Our Community CU, saw the biggest employers in one of their communities go bankrupt.The credit union responded with town halls and member group meetings to show they’d help the community recover, offering hardship assistance, bridge loans, and financial literacy education. The credit union provided truly needed services, and was rewarded with increased growth, loyalty, and reputation.

We urge you to take care of yourselves and stay well.

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Increasing non-interest income: 3 ways analytics can help https://cu-rise.com/apps/blog/entries/show/increasing-non-interest-income-3-ways-analytics-can-help https://cu-rise.com/apps/blog/entries/show/increasing-non-interest-income-3-ways-analytics-can-help#respond Thu, 05 Mar 2020 07:25:23 +0000 https://cu-rise.com/?p=6638 The post Increasing non-interest income: 3 ways analytics can help appeared first on CU Rise Analytics.

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Historically, credit unions’ major focus was on interest income earned from loans. Prior to 2010, it accounted for 80% of overall income and was plentiful enough to push other sources down the list of priorities.

It’s a different environment today. Interest rates have remained low for the last decade, and regulatory changes are squeezing revenue in areas like interchange income. As a result, credit unions’ focus has strategically shifted toward boosting sources of non-interest income.

Regardless of size, most credit unions have increasing non-interest income as a goal in 2020 – and fortunately, there are numerous opportunities for growth. Here are three ways we help credit unions achieve non-interest income growth.

Read More

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Can Credit Unions Become Millennials Preferred Financial Institution? https://cu-rise.com/apps/blog/entries/show/can-credit-unions-become-millennials-preferred-financial-institution https://cu-rise.com/apps/blog/entries/show/can-credit-unions-become-millennials-preferred-financial-institution#comments Mon, 17 Feb 2020 13:21:55 +0000 https://cu-rise.com/?p=6623 The post Can Credit Unions Become Millennials Preferred Financial Institution? appeared first on CU Rise Analytics.

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Register for our upcoming webinar - Understanding & Engaging with Millennials

Millennials, that group of young adults between the ages of 23 and 38, are gaining recognition as a consumer demographic of growing importance. As they overtake Baby Boomers as the largest adult generation, financial institutions are looking for the most effective ways to engage them.

But earning the trust – and business – of Millennials is no simple task. As per FICO, Millennials are 2-3 times more prone to switching banks and 45% of them even cited high bank fees as a major reason to do so.

But credit unions aren’t big banks – and this presents an important window of opportunity.

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Today, half of credit union members are over the age of 53. Many of their major financial life milestones have taken place. They’ve purchased a home, saved for retirement, and built a nest egg. The opportunities to expand the customer relationship are fewer.

Millennials still have many phases of life in front of them – though they may look markedly different than the generations that came before. Their lives are powered by technology. Some have little interest in, or ability to purchase home because of the burden of student loans. Many Millennials report a lack of budgeting or a financial plan for the future, which causes some to spend more than they earn. This creates financial stress that contributes to overall levels of anxiety.

It would seem they are a perfect audience to benefit from the personalized and personable service a credit union can deliver. But right now, only 24 percent of credit union members are Millennials.

Credit unions that want to cultivate trust and lasting relationships with the Millennial audience can consider the following ideas.

Offer improved budgeting tools.

Credit unions can track members’ purchase habits and provide Millennials with personalized budgets that helps them alleviate financial stress and even begin saving.

Consider experiences before services.

A study by Deloitte showed Millennials prefer experiences over “things.” Credit unions can translate this finding through attractive and efficient mobile apps that deliver superior customer experiences to an audience that expects, and heavily utilizes, digital services.

Meet their need for education.

Millennials are a generation open to new information. Appeal to this through highly tailored programs that provide financial education across an array of relevant topics. The needs across this group of young adults vary widely.

Protect their privacy

Credit unions can do more to win Millennials’ confidence by showing the measures you take to protect their personal information and offer secure banking.

Stay community focused.

Millennials favor institutions that are socially responsible and active locally. They may find credit unions’ strong community focus more attractive and rewarding to do business with.

We’ve been studying Millennials closely to help credit unions better understand the meaningful trends and effective ways to reach them. From these high-level strategies, data analytics provide the insights needed to develop and execute the actions that get the right results. Contact us to learn more about how we can help.

Register for our upcoming webinar - Understanding & Engaging with Millennials

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Three sure-shot ways Data Analytics can Increase Interchange Income https://cu-rise.com/apps/blog/entries/show/three-sure-shot-ways-data-analytics-can-increase-interchange-income https://cu-rise.com/apps/blog/entries/show/three-sure-shot-ways-data-analytics-can-increase-interchange-income#comments Wed, 05 Feb 2020 06:21:18 +0000 https://cu-rise.com/?p=6555 The post Three sure-shot ways Data Analytics can Increase Interchange Income appeared first on CU Rise Analytics.

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Interchange income is an important component of financial institutions’ non-interest income. But in recent years, retailers’ supporting regulations and regulatory changes such as the Durbin amendment have substantially reduced what financial institutions earn on debit card transactions.  Today, the average interchange income a credit union earns from a debit card transaction range between 0.30% to 0.50%, compared to more than 1.6% on a credit card transaction.

This leaves many credit unions looking for additional ways to revive lagging interchange income. One logical and effective course of action is to increase members’ credit card usage by either issuing new cards, or encouraging current debit card users to migrate to credit.

CU Rise Analytics has helped credit unions with numerous interchange income strategies that produce consistent results. By analyzing member data, it’s possible to precisely-target the members most likely to respond with highly effective offers. Here are three examples of data analysis we use.

ACH Data

ACH data can be examined using text mining techniques that look into transaction descriptions. This enables the credit union to identify the segment of members that has credit cards elsewhere, and pay the balance through their credit union checking accounts.

For a Pennsylvania-based credit union, CU Rise’s analysis identified 7,716 members that were making credit card bill payments. As shown below, it was determined that 6,422 of these members were making credit card payments to other financial institutions, a majority at a much higher rate than what was offered by the credit union. The credit union was able to target this group with attractive introductory offers on its own credit card products for spending and balance transfers and increase its response rate greatly.

ACH data

High POS Transactions

Point-of-Sale (POS) data is rich with information about spending habits and patterns. Analyzing POS behavior reveals the most relevant avenues to incentivize desired behaviors. For example, members that frequent supermarkets will be motivated by cash-back offers on grocery spending. This feeds the natural human tendency to want to be rewarded for things you are already doing.

CU Rise helps credit unions identify member segments with significant POS spending across various shopping categories, and design relevant and appealing credit card offers.

Inactive Debit Cards

Analyzing a debit card portfolio can highlight the least-engaged members. These members may not be actively using their debit cards for a variety of reasons that vary from insufficient balances, lack of rewards, or a preference for credit. Regardless of why, identifying this segment creates the opportunity to reengage these members through a card offer with an attractive bundle of rewards and features. One key part of this analysis is to carefully separate out the members that are actively using the credit unions credit card, because the last thing one wants to do is cannibalize a higher interchange product.

How is your credit union addressing interchange income? Contact us to learn more about our data-driven strategies.

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Two more credit unions select CU Rise for data technology solutions and credit card analytics https://cu-rise.com/apps/blog/show/47592051-two-more-credit-unions-select-cu-rise-for-data-technology-solutions-and-credit-card-analytics https://cu-rise.com/apps/blog/show/47592051-two-more-credit-unions-select-cu-rise-for-data-technology-solutions-and-credit-card-analytics#respond Tue, 17 Dec 2019 09:25:59 +0000 https://cu-rise.com/?p=6095 The post Two more credit unions select CU Rise for data technology solutions and credit card analytics appeared first on CU Rise Analytics.

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Two more credit unions have chosen CU Rise Analytics LLC. as their data analytics partner. San Mateo Credit Union (SMCU), a $1 billion California credit union, engaged CU Rise after implementing a new core system. CU Rise is revamping their dashboards to accommodate the new system, optimizing and creating new dashboards to better extract key business intelligence insights, and fixing performance issues. Another $985 million California credit union, Los Angeles Police Federal Credit Union (LAPFCU) is utilizing CU Rise services to build a data to decision chain, which includes strategic planning of their data needs right from data discovery and aggregation, henceforth implementing data analytics and business intelligence solutions over it.

Know more!

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Analytics can ensure your next product launch is EPIC https://cu-rise.com/apps/blog/show/47570114-analytics-can-ensure-your-next-product-launch-is-epic https://cu-rise.com/apps/blog/show/47570114-analytics-can-ensure-your-next-product-launch-is-epic#respond Thu, 12 Dec 2019 04:40:24 +0000 https://cu-rise.com/?p=6091 The post Analytics can ensure your next product launch is EPIC appeared first on CU Rise Analytics.

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In recent years, consumer demand for loans has been high. The increased loan disbursements have raised loan-to-share ratios, increasing the risk for financial institutions, including credit unions. As a result, focus has been shifting from loans to deposits to help combat risk and maintain adequate liquidity.

Reward-based checking products are currently a hot trend designed to boost deposits. But, if not informed by analytics, a product launch carries a different risk – not producing the desired results.

CU Rise Analytics’ client CBC Federal Credit Union is a California-based CU with approximately $450 million in assets. It used data analytics to its advantage to launch a checking product that became truly epic. Here’s what they did.

First, an in-depth analysis was carried out of checking products of other banks and credit unions. A collection of successful reward-based and innovative checking products and product bundles were tested to build out cost-benefit scenarios in order to select the ideal product with maximum member appeal.

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