The OGO Blog

Crucial Credit Union Budget Ideas for 2020

credit union budget

Having worked at a number of credit unions, start-ups, and mature businesses, I have officially been through about 22 budget cycles with different companies. We have crushed it, failed miserably, and somehow made budget through random acts of financial goodness that fall from the heavens.

These varying successes with budgets have given me a strong understanding of the credit union budget process. And, not to bury the lede, this experience has also led to several credit union budget ideas for 2020.

So, strap on your helmets, check your pocket protectors and buckle up. This credit union budget business is about to get real.

Getting a Grip on 2020 Credit Union Budget Ideas

I have seen many years where you spend months negotiating a credit union budget process, only to have it be completely obsolete three days after getting board approval.

I have also seen major turnarounds. Sometimes, companies on the wrong side of a long-term trend get written off for dead. Then, like unimaginable zombies, they somehow rise from the grave, make their budget, and continue life anew.

My conclusions are twofold. First, labor is the single biggest key to improving your credit union’s or organization’s lot in life. More people don’t solve more problems. If your processes and your efficiency are not already measurable and functioning, you can’t help them by throwing more people into the mix. More people just create more chaos, more problems, and more things to fix.

Second, long term success and measurable change don’t take place when focused on only one side of the income statement. Instead, the impact is most pronounced when you successfully improve revenue and improve efficiency (reduce expense). One without the other generally produces short term gains and leaves a bigger problem for the next person.

Potential Credit Union Budget Allocations for 2020

If we just look at budgeting from the financial perspective, then income and expense are the two primary factors. But the reality is that credit unions have a more delicate balancing act. Credit unions must balance income, expense, regulation, and member interest.

Sometimes those things all align. Most of the time they make us do some weird stuff! Either way, we have written the 2020 credit union budget guide with an eye towards all four quadrants. (We hope you find it helpful!)

The four primary areas of concern for credit unions are revenue, expense/efficiency, regulations, and member service. Addressing any of these on their own is a great use of your budget. But the real wins are the ones that hit multiple areas of concern, and those should be at the top of your priority list. If you can find the home run ones that hit all four—well, those are the no brainers.

Credit Union Partner Member Service Regulation Expense & Efficiency Revenue Complexity
Marketing Automation (CU 2.0) X X X Increases
Online Account Opening (Narmi & Vetter) X X X Increases
Loan Closing Automation (Lender Close) X X X Decreases
Rate Reset Technology X X X Increases
Data Analytics (OnApproach & CU Rise) X X X Increases
eNotices and eStatements (XDI) X X X Decreases
Process Automation (SMA Technologies) X X Increases
Small Dollar Lending (QCash) X X Increases
Credit Card Improvements (WalletFI) X X Increases
New Product or Service X X Increases
Voice Recognition / Alexa (Five/BIG) X Increases
Member Experience Tracking (Live Survey) X X Increases
Digital Transformation (BIG & CU 2.0) X X Increases
ATM/ITM Replacement/Refurbishment (TellerEx) X X Decreases
Office 365 (Ongoing Operations) X Decreases
Audit Automation (Redboard) X X Decreases
Managed Patching (Ongoing Operations) X X Decreases
Increase Fees (non-interest income) X None
CISO as a Service (Ongoing Operations) X X Decreases
Business Continuity Planning (Ongoing Operations) X X Decreases
CECL X Increases

So, that is a great chart. I should know. I made it! But what is half of this stuff?

Marketing Automation

Imagine you can create a personalized and unique experience for each member every time they interact with you via email, social media, or your website. Marketing automation allows for personalization across multiple delivery channels and helps keep your members highly engaged and ready for the next thing!

Online Account Opening

Let’s face it: nobody wants to fill out paperwork. Ever. According to our book, CU 2.0, 40% of consumers abandon or close their accounts in the first 100 days. Online account opening starts off the relationship on the right foot—the digital one. Show your members how easy it will be to work with your credit union by streamlining account opening with products like Narmi or Vetter.

Loan Closing Automation

Just like opening a new account can be a gigantic paperwork shuffle, so can closing on a loan. Lenderclose is a CUSO that solves this problem. They have a great piece of technology that automates the closing process and streamlines the experience for the member.

Rate Reset

Through automation, Rate Reset makes it easy to extend your loan portfolio and allow members to adjust their loans. The technology allows the member to change the term and the rate as well as readjust their credit union loan products to accommodate changes in the borrower’s life!

Data Analytics

This topic is huge. Knowing your member, finding data insights, understanding what they want next, finding efficiency gains, you name it. Analytics is a huge part of running a better credit union. Trellance/OnApproach can provide the analytics platform. CU Rise can provide the use cases to help you solve some real problems.

eNotices and eStatements

Back when I worked at a credit union, notices and statements were significant budgetary expenses. XDI saved us significant money on notices while allowing us to personalize each one. Plus, they do great statements. They were ninjas at navigating postal shipping costs, helping us presort, finding other cost-saving strategies. They also make a great chili mix. Lastly, one quick tip: stop sending notices for things under $10. You are spending more on sending them than you get back. That one saved us about $25k a year!

Workload and Process Automation

There is nothing more fun than doing the same work every day, said nobody ever. Maybe it’s posting ACH. Maybe it’s moving a file. The possibilities for tedium are endless. Either way, automating routine processes across a huge variety of technologies is what workload and process automation solves. It’s a great way to unlock the potential of your overworked employees and let them focus on your members.

Small Dollar Lending

Let’s face it. All of us have had last-minute tough situations where we needed a few hundred bucks (or like 40 euros). Maybe you need that TV, or maybe your dog actually needs emergency surgery. Either way, being there for your members is what you are all about. Small-dollar lending technology allows your members to get what they need without going through the process of justifying their expense. Bonus points awarded for skipping the credit report and using AI and relationship history with the credit union instead.

Credit Card Improvements

Did you know that very few members use their credit union credit cards in recurring payments like Netflix, Hulu or Amazon? Did you know that recurring payments interchange can be as high as $150 per year per member? What!? That’s a lot of money! Services like WalletFI provide the technology to both empower your members and increase your share of wallet through analysis, incentives, and the ability to more easily move recurring payments from one card to another.

New Product or Service

Is it time for a new certificate product, checking account, or credit card? Maybe you want to start offering mortgages. This is very tempting. Every credit union I worked at could always launch a new product and pick up some easy improvements. But it’s important to remember that each time you add a new product or service, you may be spreading yourself thin. Be careful that introducing a new service means that you focus less on an existing one. Be sure to take care of any easy wins before putting too many internal resources toward developing a new project to slightly boost your income statement or resume.

Alexa or Google Home Voice Recognition Banking

If you could go back to 1995, build your first website, and register the perfect URL for your credit union before everyone else, wouldn’t you do that? Well, Alexa/Google Home etc. are the current wild west. Make sure you get a good seat at the table. This is going to be huge! McDonalds just bought an AI/voice recognition company to automate all of their drive-thru business. The future is coming, and a lot of it involves voice-controlled robot assistants. Your members are going to want to do transactions and check their balances by asking Alexa instead of calling the CU.

Member Experience Tracking and Surveys

What if you could correlate any member experience with their transaction or interaction in real-time? That means any branch visit, conversation with a teller, or overall check cashing experience can be measured and quantified. What if you could gauge member satisfaction, learn what your members want most, or see how you compare to your peers? Would you use this superpower to help train tellers? Maybe fix a transaction that is painful or overly complicated? The possibilities are endless! Live Survey has this technology, it is affordable, and it can provide for great micro-service enhancements throughout your member experience.

Digital Transformation

Digital transformation has a lot of syllables. Why? Because it is hard and complex and means everything and nothing all at the same time. Some believe it’s for branches or marketing. Others believe it’s for IT. In reality, digital transformation is for every department, and it looks a little different for each. Digital transformation can mean migrating to the cloud, automating entire workflows across multiple systems, or simply using email instead of paper memos. Either way, defining a starting strategy is the first step, and there are a few companies that can help credit unions understand what they currently have, what they need, and how to get there.

ATM/ITM Replacement and Refurbishment

ATM and ITM hardware and software maintenance is painful. With Windows 10 on the horizon, there are some big changes coming. TellerEx makes this way easier and more affordable. They know NCR, Hyosung Nautilus, and Diebold machines and hardware inside and out. Extensive knowledge without expensive pricing means your credit union can solve a distracting and challenging problem.

Office 365

Microsoft is pushing all companies to move email and office products to Office 365. It’s not as easy as a click a button. They have tons of pricing packages and features, and migrating is challenging. Ongoing Operations has developed standardized credit union best-practice packages for Office 365 and has migrated lots of credit unions. Skip the complexity and make the move.

Audit Automation and Management Tools

What happens when you don’t actually fix that DOR? How painful is it when you have to report to the board that you didn’t actually fix that audit finding as planned? Audit automation and management tools can help. Redboard streamlines processes and optimizes audit workflows to make sure that both audit preparation and audit findings are efficiently tracked, dealt with, and put to bed.

Managed Patching

Managed patching falls in the category of things that every credit union has to do, is super boring, and is the most likely way to get hacked if you fail to do it. Ongoing Operations developed a patching platform, process, and reporting system to ensure your credit union stays up to date, allowing you to focus on higher priority issues. Even better, let’s say an emergency patch pops up Tuesday morning. There’s a good chance that they’ve already identified it, patched it, and deployed it to all of your machines!

Increase Fees

I won’t lie. There have been years where to make the budget work, we bumped the overdraft fee by $2. Or we increased the late fee. I know. It’s not very credit union-like of me. But I’m guessing I’m not the only one. Of course, we would go find a handful of credit unions with higher fees to justify the increases to our board, but it feels like a quick and dirty fix. Even so, it is a viable option and is something that credit unions should consider to fix their budgets.

CISO as a Service

Cybersecurity concerns never end and grow increasingly complex. Plus, they scare the heck out of every board. What’s more, those IT security guys get more and more expensive every year. The good news is that you can get a Chief Information Security Officer as a service. They can provide a fractional CISO for your credit union and manage the ongoing challenges of IT security with a full team of people and tools to help your credit union stay safe!

Business Continuity Planning

Just like CISO as a service, BCP as a service also ensures that you are always making progress and ready for a disaster event. CU Recover includes software, coaching, templates, and testing to help your credit union be super-efficient at its disaster recovery and business continuity planning efforts.


Every few years, the NCUA changes things up and makes all of the credit unions do a dance around the new regulatory thingy. CECL is that thingy. Your credit union will probably have to spend some money to analyze its loan portfolio and change how you account for loan losses. All in the name of protecting the insurance fund.

Good luck.