One vital advantage of cooperatives is intra-industry collaboration. A long-standing expression of this capability is credit union trade associations. They range from local chapters (largely extinct) to leagues to the national groups such as CUNA, NAFCU, NASCUS, NACUSO as well as associations focused on specific interests, e.g. the Defense Credit Union Council.
But as the average credit union grows in size, total institutions continue to decline and credit unions develop more in-house capabilities, what is their future?
Defending the Status Quo
Their actions during the crisis are instructive. They rush to convey the latest regulatory announcements; monitor congressional decisions to protect credit union interests; seek parity with other government agencies; and maybe even inject a long-standing narrow fix into the legislative agenda.
Most importantly they protect the sacred tax exemption even as they seek a credit union portion of various federal rescue funds.
Apart from insider expertise, trade associations’ political persuasiveness relies upon tens of millions of member-owners, not just 5,000 institutions. One looks in vain for the stories of credit unions’ unique role with members. Or how the tax-exempt reserves and cooperative capital are being deployed.
There is no future agenda being pursued. Just more efforts to keep “eyes open.”
Instead of championing cooperative reforms, especially for well-documented deficiencies in NCUA’s role, the industry is flooded with updates about what is happening, might happen, or will never happen in DC.
The membership and financial pressures on trade associations will only grow more urgent as a result of current events. The challenges are many:
- How will trades adjust to a shrinking credit union base?
- What if credit unions see little value in political advocacy or value it so much it becomes an in-house capability?
- What is their value as a showcase or gateway for vendors to credit union buyers?
- Will trades have any meaningful role in the development of credit union-owned services or just continue as middleman aggregators?
- Will league and other organizational consolidations erode the hard-earned loyalty of their constituents?
The Need for Vision
In a time of multiple crises and the ongoing disruption of traditional business tactics, innovation is required. There is no going back. Only forward. What is the vision for that effort?
Where do the authors of break through ideas go today in credit union land? Probably not to the trades where the dominant role is member retention, not leadership. So where will the influence once wielded by the trades move? Where will the phoenix rise from the ashes?
What will be the design of tomorrow’s “association” that attracts future credit union investment and loyalty? Will it combine CUSO business style efforts as well as industry advocacy? Will it be a source for new ideas and independent analysis? Will it form alliances and with whom?
Trade associations will not disappear. Rather, they will stay as vestigial organs celebrating past memories and arranging social gatherings. Meanwhile the designers of the future will have encamped elsewhere.