RALEIGH, N.C. (6/9/08)--Local Government FCU (LGFCU) grew its membership 7% from 2006 to 2007, and it attributes its success to a five-fold growth strategy. LGFCU, located in Raleigh, has $736 million in assets and serves the North Carolina local government community, including local government employees, elected officials, appointed persons and volunteers.
The credit union self-limits its field of membership to local government. “We believe this contributes to the strength of LGFCU,” Maurice Smith, LGFCU president told News Now
. “Our singular focus on local government gives us powerful credentials when making a case to local government officials. We can warrant that our concentration allows us to better understand our membership.” A substantial factor in LGFCU’s growth is its partnership with State Employees CU (SECU) in Raleigh, Smith said. LGFCU outsources its branch operations through SECU, which has 215 branches in North Carolina. Members of LGFCU can visit any SECU branch for service. LGFCU’s computer systems are synchronized with SECU’s so the tellers at each branch can conduct transactions seamlessly, regardless of the member’s credit union, Smith noted. “There’s nothing like having a local facility,” he said. Other parts of LGFCU’s five-fold strategy include:
* Creating close relationships with the leaders of groups in its field of membership. LGFCU has hired member development officers as traveling relationship managers to visit employers at their locations. “The familiarity that our representatives develop helps keep the welcome mat out for the credit union and thwart competitors’ efforts to undermine our connections,” Smith said; * Partnering with corporate entities where members work, which “allows LGFCU to be thought of as more than an employee benefit,” Smith said. The credit union offers payroll deduction, health savings accounts, direct deposit and commercial lending, he added; * Approaching potential members, such as those whose relatives are members of the credit union; and * Being “fanatical” about the LGFCU brand. “We recognize that members are inundated with marketing messages every day. In order for our message to stand out, we must make professional, consistent and relevant points in our communications. We hope members feel comfortable with our approach and suggest that others join,” Smith said.
This is the third installment of News Now's
Membership Growth weekly interviews with fast credit union growers. The series is as part of an initiative of the Credit Union National Association (CUNA) Membership Growth Task Force. It focuses on fast "organic" membership growth, not growth by merger or indirect loans. The task force, chaired by Dick Ensweiler, president of the Texas Credit Union League, was convened at the request of CUNA's Immediate Past Board Chair Allan Kemp McMorris. Its purpose is to investigate, report on, and encourage credit unions to embrace opportunities, techniques and processes that will increase credit unions' membership retention and growth. Like many credit unions, LGFCU is shifting its growth strategy to target younger generations. Two months ago, the credit union launched a youth advisory council with volunteer youth who share their perspective on LGFCU’s financial services and product ideas. “The purpose is to reach out and understand the younger generation,” Smith said. The volunteers are located throughout the state and don’t meet face-to-face. They meet electronically, through text messaging, the Internet and over the phone. “I’m so impressed with the young folks,” Smith said. About 12% of the credit union’s membership is under 18 years, he added. LGFCU has 18 regional advisory councils that it uses to gain feedback and promote outreach. The councils have been around since the late 1980s and involve about 250 volunteers. The credit union recently hired an employee to oversee LGFCU’s volunteer force, Smith added. LGFCU regularly tweaks the features of its products and services. “Our mortgage loans do not require private mortgage insurance no matter the loan to value,” Smith said. The credit union does not offer risk-based loan pricing, and it keeps fees to a minimum, he added. The credit union also emphasizes the value of a volunteer board, the transparency of democratic voting, the accountability of a member-led loan review committee and a commitment to being responsive to members’ concerns. “Compared to the for-profit world, we believe these features are unique,” Smith said. LGFCU doesn’t want to grow just to claim market share, Smith said. The credit union grows because of philosophical reasons. “We believe that we offer value to membership. And if we believe we offer value, it’s our duty to expose as many people as we can to the credit union. “If we want to grow 500% a year, so be it,” he said. “But if I have anything that slows growth, such as regulatory requirements, I have to ration resources. . . but we are hopeful that the regulatory climate will improve, and growth will be encouraged and rewarded.” Anyone who wants to contact the CUNA Membership Growth Task Force can e-mail the account established for this purpose at firstname.lastname@example.org.