By Rik Kielbasa 

Last year I was in Hong Kong and it looked like Times Square in New York. Neon lights everywhere. I was dazzled by all the lights and the people. It a scene I will never forget because I got lost on my first trip to Asia. Our tour guide pointed out a street close to our hotel and said, “Avoid that camera shop and street; it is run by Chinese Mafia.” He might as well have said, “Hey, you need to go down that street.” As soon as I was checked in, I went exploring in my Hawaiian shirt and rolled up cargo pants.

The streets were crowded and there was so much to see. Every store had something new and each vendor was cooking something I had never smelled or seen before. I took note of the camera store and the street I was on. Luckily the streets signs were in Chinese and English.

After about an hour I noticed I was the only tourist walking around. More and more there were expensive cars parked on the streets, with very mean looking drivers resembling the bad guys in a Hollywood movie. The words Chinese Mafia no longer sounded so interesting and I decided it was time to turn back. It was then that I noticed the street signs had changed and were no longer written in English.

Being such an experienced world traveler, I figured I would go to my back-up plan which was to show my hotel card key with the address on it and have a taxi take me back to the hotel. As I looked at the hotel card key, though, I discovered I had brought the one that did not have the address on it. To make matters worse, as I patted my pockets, I found that I had been pick-pocketed and all my cash was gone.

Feeling sorry for myself and trying to recount my way, it hit me that I could not remember exactly all the twists and turns I had made.

Suddenly I found myself in a situation and a place I had not expected to be in. Too often this same thing happens to our members as they find themselves in economic circumstances they did not anticipate. They look back and find they did not recognize the twists and turns in life, and find themselves financially lost. They are unsure of what steps to follow to get back to a place where they feel safe.

Tired from worry I made my way back to a more crowded part of the street and saw the camera store. Once at the store, though, my hopes were dashed as I saw it was another camera store that looked exactly the same as my landmark. Now completely lost, I kept walking as I didn’t want to just stand still in my green Hawaiian shirt looking pathetic. After all as an “experienced” world traveler, I was trying to blend in.

As I was walking, I kept pushing past the sidewalk stalls and the people who were trying to sell me clothes or custom made suits. Then I got an idea--a moment of pity from the universe to me, the idiot walking around blindly in Hong Kong--and the idea was … LISTEN.

Listen to what? Everyone was speaking Chinese! Then I noticed the tailors trying to sell me a suit were Indian and that they had been speaking English. Elated, I started to go from one Indian tailor to the next asking if they had heard of my hotel.

Then as I was speaking to a tailor, I got another great idea as he pressed his business card into my hand, which was to … LOOK. I looked down at the card and it looked like the other cards I had thrown in the trash as I was walking, but this time I turned the card over. There on the back of the card was a map that showed how to get from any hotel to this shop where I was standing.

Within a half hour I was back in my room safe and sound.

The same principles that helped me find my way back apply to our members who are looking for financial solutions. We have to listen to our members as we interact with them. We can’t sit back and assume they will ask for our advice. Too often our front-line staff fails to hear the unspoken questions our members want to ask someone.

We have to get our staff to look up from that teller transaction slip or computer monitor and really seek to understand what is going on in front of us with our members. Seeing who is in front of us is not always as easy as it sounds.

Years ago I recall dropping my four-year-old daughter off for preschool and the classroom had glass walls. I went to the classroom next door and watched her. She sat on the floor and cried. As a new father, my heart broke. I stood 10 feet from her, but she could not see me because she would not look up. I was there right in front of her.

We have the ability to really make a difference in the lives of the people we serve and come in contact with. These are people from our own communities, people who are trying to recover from one of the most severe economic downturns in recent history.

Some of us know people who are trying to get back on their feet, good people who have gotten lost in corporate downsizing or trapped in the mazes of underemployment. It is easy to not listen or to not look up at them directly. It is too easy to only see the Beacon score or the latest overdraft fee because they are living off overdraft each month.

This view is short-sighted, to say the least. Big banks have a similar, “only the financially healthy need apply" mentality.

Listen to the next loan application your loan officer takes. Is he or she listening to the member to gain real understanding? Is the loan officer asking questions about outside loans that can be consolidated to free up money for the member? Is the loan officer looking to do more than just act like an order taker?

As community-based economic cooperatives, we have to be the ones who listen and look a little harder at the person in front of us.

Rik Kielbasa is VP/remote service for Truliant Federal Credit Union, Winston-Salem, N.C. Be sure to check out his blog, the Credit Union MBA . 

By John Ainsworth

I had the opportunity to speak with many of you at the CUES Symposium in Hawaii in February, and when I asked the question, “Given the regulatory and revenue challenges, how many of you need a holistic payments strategy to support your credit union?” every hand went up. Understandably, credit unions have a lot on their plates in dealing with the realities of the economy, new regulations, and changing consumer spending behaviors. All of this puts pressure on payments profitability, but there are ways you can stabilize (and even advance) business during these turbulent times.

Now is as good a time as ever to reexamine your current payment card programs and implement a payments strategy to drive revenue and member loyalty in the long-term, beyond the implications of legislation today.

With the uncertainty of new regulations, we know that many institutions, including credit unions, will increase or change rates, fees or products offerings to generate additional income. Increased debit card fees or overdraft protection fees or the elimination of free checking accounts and/or lower deposit rates are all being evaluated. And one of the strategies we have begun to see is that some credit unions are trying to offset the sting of new fees to members with additional benefits and services. A prime example is introducing rewards to debit card/demand deposit accounts. As monthly or annual fees could soon replace free checking accounts, giving members the option of debit rewards for a $35 annual fee, or a $20 annual fee without rewards, could be the right positioning.

Not only is it helpful to offer new services while communicating new fees, but reward programs in general can have a very positive impact overall on member behavior. Today’s consumers aren’t relying on the traditional, hard-to-obtain rewards, but rather want to be recognized and rewarded for their everyday spending behavior. Customized segmentation can help credit unions identify the primary payment needs of target member demographics, and design rewards structures these consumers find valuable. Each credit union may see a differing impact, depending on historic behavior of members, marketing, and the overall value proposition; but it is not unusual to see a lift in activation rates, a 10-15 percent increase in usage, and most important – a reduction in attrition when engaged in a rewards program.

The reduced attrition is a compelling component. For example, if you have 20,000 demand deposit accounts that diminish by attrition at 12 percent each year, that is 2,400 accounts—and each may have $225 or more in value to you across your retail relationship. If so, reducing attrition from 2,400 to 2,000 equals a savings of 400 x $225—or $90,000! Each year!

The right rewards solutions can be priced right and can have a huge impact on inciting more profitable member behavior and retention in this changing environment.

More broadly, having in place a holistic payments strategy—one  that accounts for the post-recessionary mindset of today’s consumer and brings to market cost-effective and valuable card programs—can help credit unions enhance member value, differentiate their brand, and increase portfolio profitability.

John Ainsworth is group head of U.S. markets, MasterCard Worldwide.