How CUs Can Build All-Star Business Lending Strategies

Khushboo Gajwani

Khushboo Gajwani

December 12, 2023


While credit unions are known for their unwavering dedication to their members and their commitment to delivering exceptional experiences, many will be unable to compete on member service alone in 2024. Business members increasingly desire the convenience of managing both their consumer and business banking needs under one roof, seeking a unified and seamless experience. The integration of these services has become a competitive advantage, as it not only streamlines financial management but also fosters stronger member loyalty. 

However, many credit union members are well aware that they can easily access comprehensive online services from fintech companies and digitally mature institutions that have already fully embraced technology. To remain relevant and competitive, credit unions must bridge the gap by embracing digital innovation and expanding into business lending services. 

Why CUs Are Looking to Expand into Digital Business Lending in 2024 

In an effort to better serve their members and foster relationships with them, many credit unions are eyeing an expansion to business lending services. The existing member service model often falls short of meeting the unique requirements of business lending, making it essential for credit unions to embrace new technology and strategies to succeed in this evolving landscape. 

According to a recent CU Times Article, ‘A new report said credit unions and banks, with an average size of $4.4 billion, more than doubled their investments in digital transformation last year to nearly $425,000 per one billion in assets, up from an average of more than $200,000 per one billion in assets in 2021’  

This trend reflects the industry's recognition of the benefits of technology and how it will play a role in the future of credit unions. 

The push to expand into business lending in 2024 is driven by several key factors. Firstly, it represents a significant opportunity to better serve members who are business owners. These members require access to financing to help their businesses grow and succeed and credit unions are in an excellent position to provide this support.

Secondly, this strategic move toward business lending aligns with Credit Unions’ core missions of member community support and accessible financial services. By extending to business lending, they can not only empower local entrepreneurs but also contribute to the economic development of the communities they serve. This approach resonates with the fundamental principles of credit unions, reinforcing financial well-being and driving economic growth. 

How to get started?

To shed light on the steps credit unions can take to enter the world of business lending, we recently spoke with Mark Papoccia, Chief Member Experience Officer at Vantage West Credit Union. 

His insights are invaluable as they offer a firsthand account of how a credit union, Vantage West, successfully ventured into business lending. Vantage West’s decision to adopt Numerated’s platform was driven by a quest to create a remarkable experience for both their borrowers and their internal teams.

Identify Opportunities within Your Organization

The first step is introspection within your credit union. A meticulous review of the processes is mandated to unveil prospects for enhancement, expansion, and even the addition of some new procedures. For borrowers, the current process may involve cumbersome paperwork, delayed decisions, and a lack of clarity regarding the status of their applications. On the other hand, credit union staff might grapple with manual data entry and substantial administrative burden, leaving them with very little or no time to build relationships with the members. These pain points are often the result of outdated processes. This is where technology-driven solutions come into play. By leveraging advanced technology like Numerated’s, Vantage West was able to reduce its time to loan approval by a staggering 700%. It’s a transformative step that paves the way for a more efficient and member-focused business lending approach. 

Select the Right Vendor that matches your unique needs 

Selecting the right vendor is a critical decision, especially when it comes to optimizing your business lending operations. It’s not just about finding a vendor who is experienced in the financial sector; it’s about choosing a partner who truly understands the intricacies of business lending and prioritizes the borrower experience. This is where Numerated stands apart from the rest. Unlike many vendors, our solutions were meticulously crafted by business bankers who intimately understand the challenges and nuances of business lending. 

Build a Technology-Centered Member Experience 

Building a technology-centered member experience is crucial for credit unions venturing into business lending. The case study of Vantage West’s transformation serves as a compelling example of how technology can enhance the experience for both lenders and borrowers rather than diminishing it. 

By consistently placing members at the center of their operations and incorporating modern technology where needed, credit unions can build strong, lasting relationships. With Numerated, borrowers can enjoy an omnichannel application application experience that streamlines their journey, ensuring less frustration and faster decisions. Our intuitive user interface empowers lenders to provide exceptional guidance and support throughout, reinforcing the importance of combining technology with best-in-class customer experience. 

Numerated’s platform empowers lenders to do more with less resources. To learn more about how our solution streamlined processes for Vantage West and reduced their time to loan approval by 700%, access our case study.

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