We work with boutique credit unions every day. And we value their existence and importance to the communities and members they serve.
What do we mean by boutique?
Small credit unions, usually less than 5,000 members. From the latest trends, many of these credit unions are merging into larger credit unions. And while from a bird’s eye view, this may look like a real benefit to the membership, the simple answer is this: it all depends.
As an example, here’s one case where a merger may not be the best fit for the membership. The smaller credit union works with members to provide smaller loans for daily needs, such as car repairs and medical bills. This credit union merged into a larger credit union that didn’t offer these smaller loan amounts to members. So, now where do these members go? To a payday lender or title loan store?
Unfortunately, smaller credit unions are merging into larger ones to provide better service options to members. But our question is: Are they better or broader?
Of course, this may not always be the case, but what is the value of the boutique credit union? Here’s a short list to consider:
- They provide personalized and customized service to members.
- They are the ultimate collaborators—they must collaborate to survive in some cases.
- They focus on the bottom line; however, they recognize that service is their great strategic advantage.
How can boutique credit unions survive and thrive in the future?
Simply put, by focusing on the future. And MSA has helped many boutique credit unions do just that in the following ways:
- Work to create a board that reflects the membership.
- Design a succession plan and build your “bench” of strong candidates for leadership roles.
- Provide connections to help with services, such as human resources, marketing, accounting, and others.
- Create a strategic plan that embraces being small and works toward growing in ways that make sense for the entire membership.
Sometimes, it makes perfect sense for a smaller credit union to merge into a larger one. But we believe that merging just to merge and give members more services, or because you have “no one to take over the reins,” may not be the right strategic move.
We’re ready to help organizations make the right strategic decisions at the right time.