Recently legal counsel Henry Meier posted an article outlining his reasons for the decline of personal customer service in many retail organizations. His title The Demise of Customer Service and What It Means for Your Credit Union is a thoughtful analysis.
But what does effective customer service look like? Is it just a process of smiling and using the member’s name when they enter the credit union? Following are examples of experiences these members will never forget. They were included in the CEO’s monthly report to staff.
An Impact Maker
Destiny referred two members to our partners at Trinity Debt Management. Trinity specializes in negotiating with credit card companies (think Capital One, Bank of America, etc.) on behalf of individuals who may be over their heads in credit card debt. They can make a big impact in the financial lives of our members. Here are the two stories..
Destiny made a referral to Trinity for a member that owed $5,230 on two different cards. The original payment was $160 with only $73 going to the principal at 20% interest rate. The new payment is $15 with $123 going to the principal with the new interest rate of 7.45%! The member will save over $600!
A second member had four different credit cards with a balance of $6,122. The original payment amount was $256/month, with only $104 going to the principal at 29.63% interest. The new payment is $173 with $129 of that going to the principal. The interest is now only 9.33% saving nearly $1,400.
Way to go Destiny!
Why Service Works in a Digital Era
Saving members money is certainly a memorable service. But Meier’s article provides several reasons why this personal service is no longer the preferred business model.
Somewhere along the way, customer service became a necessary evil rather than a means of helping to build brand loyalty. Part of this trend reflects the digitalization of commerce. . .
But I’m afraid that the demise of customer service also reflects a more troubling trend, which I believe is a direct result of the rise of smartphone culture and the aftereffects of the pandemic. First, it has become too easy not to talk to each other. . .
Meier’s Credit Union Takeaway
Customer service is a lost art that has become so conspicuous that in its absence, now more than ever, it can be a differentiator for credit unions that continue to cling to the antiquated notion that customers should be treated with respect and dignity in return for giving businesses their money.
Here is my operational takeaway, no matter how good your credit union’s apps or bots become or how informative your website is: Avoid the trap of thinking of your customers as inconveniences.
Communicating with Staff
I could not help but note two other notes also in this CEO’s staff update.
The Call for Candidates for the 2025 Board of Director elections resulted in 11 candidates applying. The Board Governance Committee is in the process of constructing the ballot.
Could there be a connection between service and actual board elections by members?
The conforming loan limit is the maximum amount of money a homebuyer can borrow using a conventional mortgage that’s eligible for purchase by Fannie Mae and Freddie Mac and is increasing from $766,550 to $806,500 in 2025.
Just one example from many of how this CEO informs staff about the political, competitive and business context in which they operate.