Brynn Ammon is on the podcast to tell us that it just isn’t true that old cores can’t learn new tricks – and she has plenty of examples of integration of new skills into core systems to enable credit unions to offer more and more useful tools to their members.
Reports of the death of the core have been greatly exaggerated suggests Ammon and in this podcast she offers an arsenal of evidence to show the contrary.
She even tells about Symitar’s work to integrate a Fiserv tool and, yes, that sounds like the Hatfields and McCoys making nice – but she insists it is true and it is part of Symitar’s push to integrate into its cores the tools that will enable credit unions to compete more effectively. Even if that means cooperating with a competitor.
I will be honest, I went into this session thinking it would be as captivating as a talk on what makes a classic Singer sewing machine special.
Ammon proved my preconceptions wrong.
Listen up to find ways to get more value out of that core system in your institution.
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If Covid concerns don’t keep you away from that meeting that is on your calendar, will worries about crime and safety? That’s exactly the issue raised in a recent Hotel News Now piece that posited the moving of events, conferences and similar away from cities with crime problems.
Word of advice: if a city scares you, stay away. No need to explain. Just stay away.
But what we seem now to have is an emergent ghosting of mainstream cities, over stated worries about safety. Mind you, we are not talking about Camden NJ, East St. Louis, or Monroe LA, cities with crime rates that are stratospheric., Nope. This is cities that traditionally make the mix of candidate locations for many events.
Such as?
Reported HNN: “[Ben] Seidel [CEO of Real Hospitality Group] pointed to specific markets such as Chicago, San Francisco and Portland, Oregon, as places that struggle with high crime rates that could ultimately deter meeting planners.”
Seidel has a case: crime and fear of becoming a victim is a factor in location selection for events – but it has always been so. When I lived in Washington DC a half century ago it was definitely a no go zone for most meeting planners. So was New York in the 1980s.
So it is fact: too much crime will send planners looking elsewhere.
But then Seidel said this: “Portland is a beautiful [city], but if you’re a meeting planner now, holding a conference there with their crime rates is not going to appear on the radar screen.”
Uh, Portland? Portland, Oregon’s crime rate is moderate by any measure. Yes, it is 124% of the national average crime rate but that is small potatoes compared to, say, Birmingham AL where the crime rate is 251% of the national rate.
I really cannot see event planners – at least none that don’t guzzle the antifa koolaid – thinking Portland is a crime hotspot.
San Francisco? Sad to say Baghdad by the Bay has been sliding down the safety chart and now, according to Lee Ohanian, a senior fellow at the Hoover Institution, it is “nearly the most crime ridden city in the US.”
He writes: “San Franciscans face about a 1-in-16 chance each year of being a victim of property or violent crime, which makes the city more dangerous than 98 percent of US cities, both small and large. To put this in perspective, Compton, California, the infamous home of drug gang turf wars, and which today remains more dangerous than 90 percent of all US cities, is almost twice as safe as San Francisco.”
So, yep, some event planners definitely have crossed San Francisco off their list.
What about Chicago? I’ll give Seidel that one too. It is more dangerous than 91% of US cities – and that’s a top 10 list a meeting planner doesn’t want to put an event in. Its central location means it still scores high in attractiveness to planners but they also are eyeing the headline murders that frequently rock the city.
But there are many more cities that will get a pass from many event planners today. Other must avoids according to the stats are Detroit, St. Louis, Baltimore, and New Orleans. But not so fast. I have to say I have been to New Orleans perhaps 10 times in this century, never was a crime victim, never saw a crime., will happily return. It’s a city with a great and unique vibe.
Which pinpoints an issue with any blanket statement that such and such a town is “too dangerous” – it depends upon “for whom,” that is, what group is involved and what’s its appetite for risk.
Of the cities so far mentioned in this article I have been to Baltimore once this century – no problems; Chicago five times and liked it a lot, also did a lot of walking, no problems; and San Francisco, dozens of times, no issues and often I stayed on the margin of the Tenderloin, San Francisco’s high crime mecca. The Tenderloin is cheap and conveniently located and that’s why I like it.
Would I recommend you stay in the Tenderloin? That would be up to you.
Would I recommend a group meet in San Francisco? It depends upon the group. There are some groups that would be repelled by San Francisco and for them there is Las Vegas or Orlando (and I am a fan of Las Vegas, even though I have neither gambled or seen a show in many trips there this century).
But there are other groups that will love how urban San Francisco is.
Know your group and you will know what towns work it it and what don’t.
And do remember, more than crime shapes a city’s suitability for an event. Personally I cannot imagine going to an event in Palm Beach, say, and that has little to do with the city’s iffy safety rating. You can guess why.
No, I don’t envy event planners their work. There just are lots of issues they need to weigh. And safety/crime is just one of them.
Can AI – artificial intelligence – be harnessed to build and strength member relations, indeed to know what this member is likely to do right now?
That is the guiding belief at Senso, a Canada based AI company that now is expanding into the US market with a specific focus on credit unions.
It is no secret. The credit union share of the home mortgage market has steadily eroded, as nimble fintechs grab more business. Smart AI just may give credit unions an edge in recapturing marketshare.
The Senso promise is intriguing. When an institution has the right data it can predict with significant accuracy when a member is about to shift from being a home looker to a buyer.
The answer is in the data, says Saroop Bharwani, Senso’s founder/CEO.
Right now the Senso focus is on home mortgages but, he says, the same tools will work on car loans, credit card balance transfers and more.
Here is how Senso describes its approach: “Senso creates connected and contextual lending experiences, powered by predictive intelligence.
We enable enterprise customers to identify and engage borrowers with personalized proactive experiences.
We empower consumers with rich insights & experiences to help them make smart decisions through their home finance journey.”
Integration of Senso tools – which are available white labeled – is comparatively quick and easy through the leading online banking platforms.
Right now, the primary Senso aim is at institutions with a billion in assets – but if a smaller institution is using an online banking platform that Senso already has integration tools for, the company wants to talk, says Bharwani.
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Everywhere we turn the buzz now loudly proclaims that travel – leisure travel – is back and, sure. there is muttering that the rebound of business travel is just around the bend but I don’t believe that and doubt that many of the people predicting it do either. But they want to believe it because our travel economy’s health remains fragile.
Eyes now are on leisure travel and four initials BNPL as the potential cure for what ails travel. Buy Now, Pay Later. Many in the travel industry are now busy buffing BNPL offerings, to entice consumers into more leisure travel. Amadeus research underlines the potential payoff to an industry struggling for survival. Per Amadeus:
68% said BNPL would encourage them to spend more than usual on summer travel
49% said they would be more likely to buy airline ancillary services if BNPL was offered
Here’s a moral – maybe also a pragmatic – question: is it good to put leisure travel on credit? That is, to pay it off over time. Is that a smart consumer tactic?
A simpler question: Isn’t BNPL just credit, as in cards, with a catchier 2022 name? Nope. There is a significant difference. Put $5,000 on a credit card funding a Spanish vacation and you can pay anywhere from $5000 back to multiples of that depending upon the interest rate charged on your card and how much you pay back, how fast.
BankRate has a for instance where $5000 is put on a credit card with 18.9% interest. The minimum monthly payment is 4% of the balance owed, $200 to start. Pay only that and, take a guess, how long will it take to repay that $5000?
11.4 years (137 months). Total payments will be $8109.
Ouch.
Where BNPL differs is that, typically, a monthly payment is specified in the origination paperwork and, in many cases, payback is timed for a couple years.
Gen Z and younger Millennials are said to be wild about BNPL which, suddenly, has become the hot trend in consumer payments. Part of the fuel is that these groups are anti credit card. They also know the horror stories of people paying back a purchase for 10+ years! They want to eschew conventional credit and BNPL, some believe, is their ticket to buying what they want now, paying for it over a specified period, with specified monthly instalments.
There isn’t much new about BNPL. It’s if anything a throwback to 1950s layaway purchases although in that case the customer did not take possession of the item until it was paid off. With BNPL 2022 style the consumer walks out of the store – or the travel agency – with the purchase.
Also new today is that modern technology allows for nearly instant credit decisions. Note that, with many BNPL providers, the decision is not FICO based. Many of the buyers have lower FICO scores anyway so that wouldn’t work. So the issuers frequently look at cash flow in a checking account – is there an extra $100 floating around most months? If yes, then ok the BNPL deal with a $100 monthly payment.
Which brings us back to BNPL and travel today. And the worries thicken. Per Amadeus, “For travel merchants the real [BNPL] opportunity is the product upsell. If the traveler has flexible credit they can potentially afford to make a higher value purchase, or to add more ancillary services.”
Why travel to Hawaii when, for maybe double the money, you can go to the Maldives or the Seychelles and how much cooler are those destinations?
Sure, the debts mount but so?
Actually Amadeus offers an insightful gloss on that so: “Offering this type of payment method isn’t without risk. Travel companies need to consider any risk to their brand that could result from a BNPL partner offering credit aggressively to travelers that are already highly indebted. At Amadeus we are consulting with our customers to assist them with BNPL strategies that prioritize responsible lending.”
Consumers, too, need to watch their own backs. Maybe, technically, BNPL does not involve credit but it clearly involves debt and too much debt is not a good thing.
Am I inalterably opposed to BNPL? No. I see it serving very good purposes in specific cases. In fact I have used a version of it on multiple occasions, getting what amounts to an interest free loan from Apple when I bought a new iPhone or iPad. From Google I got an interest free loan to buy a Pixel phone. In these cases, I had the cash on hand but couldn’t resist stretching out the payments and why not, it was free.
But using BNPL for travel? Color me financially conservative but I just cannot wrap my head around the idea of financing a vacation. This just is an idea I find creepy.
And nudging people into more expensive vacations is integral to the recovery of the travel sector?
The name is pronounced CU Soul and know that the CUSO’s focus under CEO Jonathan Taylor is indeed on soulful solutions to member problems.
You almost want to cue up “Soul Man” and break out in song.
But these are very serious, thoughtful and – yes – quirky solutions that are getting cooked up at the Albuquerque-based CUSO, formed in 2019 and owned by four credit unions located in New Mexico, Washington DC and Guam. They range in size from well over $1 billion to around $30 millon.
The owners did not create CU Sol to provide cookie cutter products.
Nope.
These are products that are unique and they also are laser focused.
Consider CU SAFE: “CU SAFE is an indirect lending solution created by CU Sol that supports survivors of domestic violence. Its mission is to provide a hand up for survivors of domestic violence in providing both credit and financial counselling as well as lending options by pairing organizations that support survivors of domestic violence with partnering credit unions,”spells out a press release.
Another product is Accelewage which starts with the building block that each day an employee works he/she has earned money. Now what if that employee needs a fast $300 – perhaps for an emergency car repair – but doesn’t have available credit? He could go to a payday lender.
But isn’t the better choice simply to make the employee a cash advance against accrued earnings?
Taylor sees Accelewage rolling out initially to credit unions themselves where many employees live paycheck to paycheck.
But then the tool can also be offered to business members too and that could be a powerful persuader in getting new business accounts.
Taylor also has a range of ideas about innovative insurance products to be offered through the CUSO.
Nowadays the talk is how CUSOs have to be highly focused – and, yes, original – to survive. CU Soul is definitely both
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My first resolution for 2022 is that I am now telling clients that I am available for travel this year.
I was unavailable in 2021 and much of 2020.
This a.m. I even changed the airline designated with Amex Plat for the $200 fee credit (to Delta for those keeping score). I had not collected a penny of the credit in 2021 but I am optimistic I will in 2022 so I spent the few minutes calling Amex.
And, yes, another resolution is to travel healthy and smart. I am not joining the ranks of the maskless fools or the inflight mask rebels, indeed I will probably doubledown on sanitation and mask wearing. Yes, I plan to travel but I also plan to do what I can to stay well.
Part of that is accepting that Covid is not going away, not soon. Nonetheless I plan to travel. But not stupidly.
So I am switching from cloth masks to high tech Korean masks (KF95 and KF94), to seek to stay healthy in Maricopa County where Covid cases are rocketing higher and yet the maskless multiply. I can’t change their behavior but I can toughen up my own borders. Of course I will wear similar inflight.
Another resolution – maybe just an acknowledgement – is that the value of tracking online Covid case counters has plummeted as more of us test at home and if you test positive do you really call it in and to whom and is it recorded? Experts warn that the present counts are desperately deflated and so I am no longer basing decisions regarding safety of destinations on these numbers.
But I am checking hospital ICU capacity. Obviously, not all ICU beds are occupied by Covid patients but a reasonable guess is that cities where ICU capacity is at bursting are experiencing Covid outbreaks.
Also useful are counters for percentage of a state that is vaccinated. Pick a number you are comfortable with and don’t go to states with lower counts (Idaho brings up the rear).
A last chart to eyeball ranks states by the percentage that is boosted and, yeah, the numbers are inexplicably, sadly low but the stats provide some guidance about where to go and where to avoid (New Hampshire and Hawaii, looking at you).
Even so, I plan to rely on my own instincts about a room when judging whether to go in or not and to stay or not. The macro numbers are useful but decisions about safety are, in my mind, very local.
Here’s the money question: Will I do long-haul travel? That’s maybe the question of the year because, from what I am seeing, it appears that many – indeed most – of us are ready for short-haul travel, often via car, and that makes sense because that is an environment we can control.
Put us in a large public conveyance (aka airplane) and we have much less – bordering on no – control and there also are the anti mask crazies, the violent nutters, and the rest we want to avoid.
But I will tell you I am deep into planning a trip to Europe in Q3 and that will involve many hours of flying. But I did a similar itinerary in Q3 2021, used commonsense and social distancing to the extent possible, and left after three weeks with a negative Covid test at Madrid Airport. I never felt real risk on the trip, except on the last day when waiting for a final flight to Phoenix at an overcrowded LAX. The European portion of my travels was delightful.
Spain does require arriving Americans to be vaccinated – and very likely soon will also require proof of a booster. Portugal does not require a vaccination but does require a recent negative test. I am planning to go to both.
What I am saying is that I am creating my own new normal. I believe we now are entering a period of learning to live with and around Covid. As more of us get vaccinated and boosted and probably boosted again, infection rates will continue to drop as will hospitalizations.
If we take our own health seriously I believe we can safely navigate the travel terrain that lies in front of us and, frankly, I am ready to go.
Our first show in 2022 is about a topic that you will likely will be hearing a lot about this year: Crypto currencies. And what you may not realize is that with crypto in play the financial institution stranglehold on wire transfers may slip. Even worse, credit card interchange may vanish.
Now do we have your attention?
Crypto brings risks but also possible rewards for smart players.
On today’s show is Larry Pruss, crypto lead at consulting firm SRM (Strategic Resource Management). and, says Pruss, crypto is streaming at you at full speed
Proof is that NCUA in December offered guidance about how credit unions should interact with crypto vendors.
Maybe the biggest risk to credit unions is that evidence mounts that many members will leave a financial institution that doesn’t offer crypto related services for one that does. At the very least they will move money out of your credit union into an institution that trades in crypto.
We may well be at a perilous moment for traditional FIs as DeFi (decentralized finance) moves onto center stage.
How to get involved in crypto with minimal risk? Pruss offers suggestions in the podcast and, from my perspective, the easiest way to stick a toe into these digital waters is by offering crypto rewards. More institutions – Venmo for instance – already are on this but there remains running room for credit unions that want to play.
And Pruss has other suggestions.
This is a fast paced podcast. Inside 40 minutes you will hear what you need to know to play in crypto. Smartly.
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Walt Agius knows credit union lending. And he especially knows what credit unions need to to stay competitive in the 21st century.
Consider this podcast a deep dive into today’s lending.
The guest is Walt Agius, CEO of Lendsys, a fintech, and also CU Lending Edge, a CUSO that today focuses on car loans but, says Agius, he is looking to extend the portfolio.
In the past he was CEO of CU Sol, a CUSO, and also CEO of California Bear Credit Union.
He really knows lending, especially car loans.
In this podcast Agius offers tips about how to make indirect auto lending work for the credit union (and, yes, he knows many credit unions have grumbles about indirect lending).
He also throws out the idea that every credit union should be looking hard at syndicating every loan that comes in the door. That strategy dramatically limits risk. He said he would want to keep perhaps 10% of most loans but he would want to sell the other 90% of other participants – and this collaborative way is a particularly credit union mindset.
Like what you are hearing? Find out how you can help sponsor this podcast here. Very affordable sponsorship packages are available. Email rjmcgarvey@gmail.com
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Find out more about CU2.0 and the digital transformation of credit unions here. It’s a journey every credit union needs to take. Pronto
Put your brainstorming hat on. You’ll want it as you listen to this podcast that serves as a preview of the January 20, 2022 CU 2.0 Brainstorm event that will gather together fintech leaders and credit union executives for a day of lively presentations (topics to be chosen by the attendees) and conversation.
Consider this podcast a mini preview of what the Brainstorm event will feel like.
Joe Cianciolo talks about how HomePace – a fintech that makes home equity investments that may be tapped by homeowners and buyers without taking on debt.
Chief information officer Kenzie tells about the tech priorities at Patriot Federal Credit Union, a $900 million institution – and he tells what he looks for in the fintechs he works with
Drake tells about the urgency of matching up credit unions and the right fintechs and the challenges of making it happen.
It’s a show that will leave you more informed and also energized.
Want more info on the Brainstorm event? Click here. There’s a sign up tool at the same site.
Want more from Cianciolo? You got it. Here’s an earlier CU 2.0 podcast with him from June 2021.
Want more on the CU 2.0 Mastermind group? Here’s a November 2020 podcast on it.
Like what you are hearing? Find out how you can help sponsor this podcast here. Very affordable sponsorship packages are available. Email rjmcgarvey@gmail.com
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Find out more about CU2.0 and the digital transformation of credit unions here. It’s a journey every credit union needs to take. Pronto
Every year, around this time, I have spent a few minutes mulling my travel plans for the new year ahead and, occasionally, doing a mileage run to grab a better elite status and almost always planning at least one trip for fun.
This year is different. Mainly because it borders on the impossible to forecast what my travel year will look like. If forced to guess I’d say pretty similar to 2021 which featured exactly one trip (to Spain in early fall; in 2022 I plan a trip to Portugal and Spain, from Porto to San Sebastian).
What about business travel?
Yeah, what about it?
I am looking at a report from polling firm Morning Consult on “The State of Travel and Hospitality – Q4 2021 Report” (free download here) that serves up immense gloom regarding business travel.
Just about all travel in fact.
Perhaps we are at a crossroad where – fueled by environmental concerns and triggered by the immediacy of Covid – our relationship to travel is undergoing immense change.
Keep in mind that the phenomenon of mass longhaul travel is recent – the first commercial trans Pacific flight was 1936 (Pan Am). It wasn’t until the late 1950s that commercial jet travel took root and deep into the 1960s when it became commonplace. Meaning we have maybe 50+ years of mass longhaul travel and that’s a speck in the history of human existence.
Don’t think we cannot turn off that desire. It’s happening. The Morning Consult numbers suggest as much.
One in three of us say it will be more than a year (12% say never) that they will travel for leisure.
Holding back an energetic return to leisure travel, per Morning Consult, is confusion and concern about Covid-related travel concerns and requirements. When do I need a Covid test, what kind, by when? Do I need to carry my vaccination card? Can I get into country X at all? Does the US State Dept. say it’s safe? Can I travel back home?
If you are not at least slightly frazzled by all this you are not paying attention. It’s a world of numerous and shifting rules, requirements, and restrictions.
Air rage is also keeping some of us on the ground – more of us than I would have thought. Per Morning Consult, 41% of us have traveled less because of concerns about the behavior of other passengers.
63% of us are at least slightly concerned about an air rage incident on their next flight. Only 36% are not at all concerned which, I guess, is where I fall.
63% of us also support a vaccine mandate for air travel (and 81% support it for international travel). These numbers tell me that the anti vaxxers may be loud but their numbers aren’t so high as to matter when setting policies. I urge the Biden Administration to listen to the people and to issue an Executive Order that mandates vaccines for air travel. That will help get more us in the air, more often.
As for business travel, the forecast is gloomy – and it is especially gloomy coming from people who had traveled for business at least three times a year. 39% of that group in the US now say they will never travel for business again.
Never.
48% of Germans say likewise. 62% of French. 39% of Canadians.
Of the business trips that do occur, one in five will be day trips, says Morning Consult. And 55% will make business trips by car. 15% will travel by bus. 16% by train.
Only 50% say they expect some trips to involve a plane.
Another shoe dropping – not reflected in the Morning Consult data – is that sustainability concerns may further deflate travel, especially long haul jet travel. Accenture data say that 66% of us are “ramping up” their sustainable/ethical purchasing. Wall Street and thus the C suite also are climbing aboard the sustainability wagon.
That bodes poorly for jet travel.
Back at Morning Consult, it’s forecast is pure gloom: Business travel will never return to prepandemic levels.
I agree. And the dramatic word is “never.”
We definitely don’t know what the new normal will be regarding business travel. But it will be different. Lots different. We know that much.
