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CU System briefs (03/11/2014)

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  • HARRISBURG, Pa. (3/11/14)--The Pennsylvania Credit Union Association (PCUA) presented Jim McCormack, retired president/CEO, center, with his Herb Wegner Lifetime Achievement Award Friday (Life is a Highway March 10). McCormack was unable to attend the award ceremony in Washington, D.C., in February so PCUA President/CEO Patrick Conway, Senior Vice President Michael Wishnow and Chair Maria LaVelle had accepted the award on his behalf. During his visit, McCormack told the staff that this award is not his alone. "This award belongs to all of you and to everyone who has worked in the Pennsylvania credit union movement," McCormack said ...
  • ALBANY, N.Y. (3/11/14)--Former U.S. Sen. Alfonse D'Amato will be a featured speaker at the Credit Union Association of New York's 2014 State Governmental Affairs Conference (GAC). The former three-term senator served as chairman of the Senate Banking Committee and as a member of the Senate Appropriations Committee and the Senate Finance Committee. New York's GAC will be April 28-30 in Albany (The Point March 10) ...
  • HAUPPAUGE, N.Y. (3/11/14)--Three of the 11 winners of Island FCU's high school scholarship program will be awarded $10,000 this year. The others will receive one-time payments of $2,500, for a total of $50,000 for the class of 2014. Since 1992, the $948 million-asset credit union has awarded more than 250 scholarships totaling worth $340,000. Eligible students must be high school seniors accepted into a full-time undergraduate program and have an active account with the Hauppauge, N.Y.-based credit union ...

CUs offering citizenship loans for immigrants

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MADISON, Wis. (3/11/14)--Helping immigrants obtain citizenship status is one of the ways credit unions fulfill the people-helping-people philosophy in the new millennium.
 
A 2012 survey by the Pew Research Center found that not being able to afford the cost to apply for citizenship was among the top two reasons immigrants cited for not applying for citizenship. Only not being able to speak English well enough was cited more often.
 
The current cost for a citizenship application is $680, up from $225 in 1999. Increasingly, credit unions are helping immigrants overcome this obstacle by offering citizenship application loans.
 
Coopera, a Des Moines, Iowa-based company that works with credit unions to serve the Hispanic market, recommends that its clients offer loans to help members through the citizenship process, said Miriam De Dios, Coopera president/CEO.
 
"If you look at the whole immigration process, there are folks who are going through different phases of it every day," De Dios told News Now. "It's something that I went through personally, and it's costly. When we talk to our client credit unions we know it's a need. They offer loans, and we try to work with them to make them as relevant to the process as possible."
 
De Dios recommends that credit unions work with other community agencies that offer additional expertise, such as legal counsel and assistance working through the immigration process. "There's all sorts of community organizations that are helping folks better understand this process. Credit unions can team up with them and add in the financial education component of this," she added.
 
Promise CU, with $5 million in assets, Houston, began offering citizenship loans after piloting the program in 2012.
 
"It's a way to ease the process," Randy Martinez, Promise CU president/CEO, told News Now.
 
The $455 loan includes a $75 application fee. Applicants must contribute $300 of their own money. The loan carries a 12-month term with a 5% interest rate. Monthly payments are about $38, Martinez said.
 
Promise CU also partners with Neighborhood Centers Inc., a nonprofit network of community centers in the Houston area that works with immigrants. Several times a year, Neighborhood Centers holds citizenship forums that include attorneys and volunteers to assist with paperwork. Promise CU representatives provide financial advice, including assistance with the loan application process, Martinez said.
 
Second FCU, Chicago, a division of Self-Help FCU, a $558 million-asset credit union in Durham, N.C., offers loans that range from $680 to $4,000 to cover citizenship application fees and legal costs (Medill Reports Feb. 26).
 
The citizenship loans have repayment term from 12 to 24 months with an interest rate of 12%. Applicants must have established legal residency and earn at least $500 monthly.
 
Community Trust CU, Modesto, Calif., another division of Self-Help FCU, began offering citizenship application loans last month (The Bakersfield Californian Feb. 16). Loan amounts can be up to $1000 for an individual or $4000 for a family. Borrowers carry a 12% interest rate, or less if the principal is paid off before the funds are disbursed.
 
The National Federation of Community Development Credit Unions and Grantmakers Concerned with Immigrants and Refugees are launching the Northwest Area Immigrant Asset-Building Initiative to promote citizenship, integration and financial security for immigrant communities across the Northwest region.
 
With support from the Northwest Area Foundation, the initiative will select two to three pilot sites where credit union products and services will be integrated with immigrant legal and social services to provide comprehensive solutions for immigrants seeking to naturalize and build credit and assets.

Grantees will be announced in April. The 12-month pilot is scheduled to in June.

'Vishing' scams making the rounds again

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MADISON, Wis. (3/11/14)--Some credit unions are reporting that their members are being targeted with phone calls and voice messages that claim their debit or credit cards have been compromised.
 
The scam, called "vishing," includes automated messages that prompt the members to enter confidential information such as the card number and PIN.
 
Fort Atkinson (Wis.) Community CU was targeted last week, according to Sue Johnson, senior vice president of the $196 million-asset credit union (WMTV-15 March 7).
 
The credit union's fraud department reacted quickly, resulting in only a few members being affected. Even those affected have no liability for the fraud losses, stressed Johnson.
 
Financial Builders FCU, $70 million in assets, also reported fraud incidents. The Kokomo, Ind., Police Department said scammers are falsely representing the credit union, purportedly informing members that their cards have been deactivated (Kokomo Perspective March 10).
 
The police also told consumers that if they did provide their information to these callers, they should call their credit union or other financial institution in order to protect their card.
 
Johnson reminded consumers that financial institutions will never ask for this type of confidential information over the phone.

'Better Choice' equals $27M in better savings for members

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HARRISBURG, Pa. (3/11/14)--More than 87,000 short-term loans have been issued in Pennsylvania through the "Credit Union Better Choice" since the program was launched in 2006---saving borrowers more than $27 million over using a traditional payday lending product, the Pennsylvania Credit Union Association (PCUA) reported.
 
"For more than seven years, Better Choice loans have been meeting the emergency loan needs of credit union members," said Patrick Conway, PCUA president/CEO. "The continued growth in the volume of loans demonstrates the ongoing need for this program.

"'Better Choice' is an example of the people-helping-people philosophy of the credit union movement and demonstrates our difference from for-profit financial providers," he said, adding, "I encourage Pennsylvanians who are not using a credit union to consider switching to one for all of their financial needs."
 
The "Credit Union Better Choice" loan is a payday lending alternative product where credit unions offer borrowers a 90-day loan with a $500 limit. Reasons cited for loan purpose have included Christmas gifts, taxes, car repairs, heating fuel and funeral expenses.
 
The "Credit Union Better Choice" was developed through a collaboration of the PCUA, Pennsylvania Treasury Department and the Pennsylvania Department of Banking and Securities.
 
Currently, 65 credit unions with 178 locations offer "Credit Union Better Choice" loans across Pennsylvania. During 2013, 11,178 loans totaling more than $5.5 million were issued, PCUA reported. Borrowers also placed more than $551,710--10% of the loan total--into savings accounts.
 
A typical $500 payday loan costs consumers $15 for every $100 borrowed for two weeks, or about $450 over 90 days. A $500 "Credit Union Better Choice" loan costs consumers roughly $42.50 for 90 days. At the end of the loan term, the consumer has $50 in a savings account.
 
Pennsylvania consumers saved an average of 80 cents in loan fees and costs for every dollar borrowed through a "Credit Union Better Choice" loan rather than through a typical loan from a payday lender. That translates into more than $27 million consumers kept in their pockets by using the loans.

Desert Schools FCU's golf tourney raises $341K for CMNH

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PHOENIX (3/11/14)--Better than a birdie or even a hole-in-one, the results from Desert Schools FCU's 16th annual golf tournament resulted in $341,000 for the Children's Miracle Network Hospital in Phoenix.
 
The recipient--Phoenix Children's Hospital--will use the funds for its "1 Darn Cool School," which provides educational resources to children undergoing long-term treatment (Phoenix Business Journal March 7).
 
The hospital--Arizona's only member of the Children's Miracle Network--covers more than 70 pediatric specialties for inpatient, outpatient, trauma, emergency and urgent care.
 
The Phoenix-based credit union started the golf event in 1998 and has raised more than $2.4 million for the Children's Miracle Network Hospitals.
 
Desert Schools FCU also is celebrating its 75th anniversary with its "Shine On" program that includes more than $1 million in donations to various community groups.
 
"Our partners, our customers, and our friends in the community help to make these donations possible all year long," the credit union's Executive Vice President Ron Amstutz told the paper.

Consumers moving faster to mobile bill pay then providers, Fiserv says

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BROOKFIELD, Wis. (3/11/14)--Billing companies are having a difficult time keeping up with the swelling popularity of mobile bill-pay services, according to results of Fiserv's annual Mobile Bill Pay Benchmark study.

The study, released last week, found that while more than one in four consumers are signing on to billing websites to pay bills, only 15% of billers have put together mobile billing and payment strategies--a critical investment to accommodate the fast-growing demand for Mobile Billing Presentment and Payment (MBPP) services.

"Our research indicates explosive growth of mobile bill payments," said Robert Craig, senior vice president of biller solutions, Fiserv. "Billers have an opportunity to take advantage of this change by offering a consistent, simple and innovative user experience, which can improve customer satisfaction and lower service costs.

"Billers will benefit by delivering a true omni-channel billing and payment strategy to consumers, including a strong mobile presence," he added.

Part of the problem for billers, it seems, stems from a lack of information technology resources. The survey found that 64% of billers couldn't determine whether homepage visits came from mobile devices, and one-third couldn't track which services or activities customers navigated to when they accessed their sites.

More and more, however, billers are acknowledging the value that these services provide. In 2013, 95% of billers viewed MBPP as a way to improve customer service, which is a 36% increase from the previous year.

The survey also revealed a 56% jump from 2012 in billers who are looking at MBPP services to drive e-bill adoption. Further, 69% of those surveyed said cost savings were behind their company's interest in the service.

14 CUs ready to test 'Borrow & Save' program

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NEW YORK (3/11/14)--The "Borrow & Save" program, a small-dollar loan product for low- and moderate-income consumers, has reached capacity with 14 credit unions nationwide.
 
"Borrow & Save," a product of the National Federation of Community Development Credit Unions, is one of five products in the Filene Research Institute's accessible financial services incubator funded by the Ford Foundation.
 
"Credit unions have a long history as being the proving ground for consumer-centric, innovative financial products," said Cynthia Campbell, Filene's director of Innovation Labs. "Partnering with the federation to test 'Borrow & Save's' viability with mainstream financial institutions was a natural fit, since their experience in working with low- to moderate-income consumers is extensive."
 
"Borrow & Save" increases members' economic security by providing an affordable small-dollar loan with payment terms that make sense for the member, giving them an alternative to predatory lenders. A built-in savings component also enables members to self-fund their emergencies instead of borrowing money to handle them.
 
"The large number of credit unions interested in participating in the 'Borrow & Save' pilot reflects the need among low-income consumers for affordable loans that provide a safe alternative to predatory lenders," said Cathie Mahon, federation president/CEO. "'Borrow & Save's' unique mandatory savings help consumers strengthen their financial condition by building credit and developing a cushion against future emergencies." 
 
Credit unions that will test the 'Borrow & Save' product include:
  • 1199 SEIU FCU, New York;
  • Carter FCU, Springhill, La.;
  • Communicating Arts CU, Detroit;
  • Credit Union 1, Anchorage, Alaska;
  • Freedom First CU, Roanoke, Va.;
  • Guadalupe CU, Santa Fe, N.M.;
  • Hope CU, Jackson, Miss.;
  • Lake Trust CU, Lansing, Mich.;
  • North Side Community CU, Chicago;
  • Peninsula Community FCU, Shelton, Wash.;
  • Seasons FCU, Middletown, Conn.;
  • SkyOne FCU, Hawthorne, Calif.;
  • Southwest 66 CU, Odessa, Texas; and
  • Urban Upbound FCU, Long Island City, N.Y.

Maine's elder abuse training set for Wednesday

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AUGUSTA, Maine (3/11/14)--A Maine-based program to train credit union personnel on how to prevent and identify different types of elder abuse will take place Wednesday at the Augusta Civic Center in Augusta.

The event, developed by the Maine Credit Union League (MCUL) and the Maine Council for Elder Abuse Prevention, was rescheduled from last month due to inclement weather. Registration is still open.

The program, titled "Preventing Financial Exploitation of the Elderly: The Role of Financial Institutions," is a free, three-hour training session and is available to all credit union staff.

"Credit unions are all too familiar with our senior members falling victim to financial fraud, either through 'foreign lottery' types of scams or theft by family or caregivers," league board member Kyle Casburn, president/CEO of $109 million-asset Seaboard FCU, Bucksport, told News Now Jan. 23. "Credit unions have an opportunity to use our collective resources to educate our members on fraud and provide tips on monitoring our loved one's accounts."

The training will help employees identify red flags and signs of financial exploitation with older members; determine when it's appropriate to report an incident to Adult Protective Services or other agencies; and decide when to refer members to community-based resources.

Speakers will include Jaye Martin, executive director, Legal Services for the Elderly; John Barr, deputy superintendent, Bureau of Financial Institutions; Doreen McDaniel, director, Adult Protective Services; Jessica Maurer, executive director, Maine Association of Area Agencies on Aging; and Judith Shaw, administrator, Maine Office of Securities.

To register, use the resource link, or email serlandson@mainecul.org.

N.H. CUs welcome state legislators

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MANCHESTER, N.H. (3/11/14)--Last week, the New Hampshire Credit Union League (NHCUL) hosted its annual legislative reception with state legislative and regulatory delegates.
 
St. Mary's Bank CU President/CEO Ronald Covey, left, and Business Development Officer and Director of Community Outreach Thomas Champagne speak with State. Sen. David Boutin (R-Hooksett) during the New Hampshire legislative reception. (Daily CU Scan photo)
Thirty credit union representatives met with members of New Hampshire Senate, House Commerce and Consumer Affairs Committee, and the New Hampshire Banking Department (Daily CU Scan March 10).
 
Paul Gentile, NHCUL president/CEO, gave a status update on the state's credit unions, which experienced 10.39% loan growth and an increase in membership of 4.7%. He also noted that New Hampshire's credit unions have excellent credit quality with a delinquency rate of 0.5%.
 
State Sen. Lou D'Allesandro (D-Concord) praised the credit unions for playing a vital role in the economic viability of the state. D'Allesandro, who currently is board chair for $141 million-asset Members First CU of NH, told the group about his personal experience buying a home. The help he received from Manchester-based Telephone Workers' CU (now Bellwether Community CU) is an example of the personal touch that credit unions need to maintain, he said.
 
During the two-hour event, Senate President Chuck Morse (R-Salem) told the group that "New Hampshire's credit unions are great and important to the state of New Hampshire in helping the local economy grow."
 
He added, "Small businesses also need help, and credit unions play a significant role in assisting them."