CU2.0 Podcast Episode 28 Patrick Conway PCUA on Lobbying and Much More

Consider this podcast a crash course on credit union lobbying, 2019 style. Our instructor: Patrick Conway, CEO of the Pennsylvania Credit Union Association, a very large league with upwards of 370 members.

PCUA lobbies both in Harrisburg, the state capital, and in Washington, DC.

A lot of what PCUA does however could be considered credit union education. For instance, PCUA has played a lead role in the new Philadelphia ID card – designed to give Philadelphia residents a low cost ID card. Will it be adequate for opening a new account at a credit union? That’s still being sorted out and PCUA is in the mix, offering education and counsel to its members.

PCUA is doing likewise with cannabis banking, a topic of significant interest to Pennsylvania credit unions.

Along the way we also talk about credit unions haves and the have nots and, in Pennsylvania, assured Conway, the big credit unions offer plenty of assistance to smaller institutions.

Other topics on the agenda: credit union tax exemption, the CUNA-league relationship, and what credit union can do to win greater consumer acceptance.

This is a rich podcast.  Give it several listens.

Listen here.

Like what you are hearing? Find out how you can help sponsor this podcast here. Very affordable sponsorship packages are available.

Find out more about CU2.0 and the digital transformation of credit unions here. It’s a journey every credit union needs to take. Pronto.

For Whom Does the Hotel Phone Ring?


By Robert McGarvey

Is it time to hang up on inroom hotel phones?

Honestly: I do not answer the inroom phone.  Nor do I check the messages. I assume the call isn’t for me and if it is, it’s unwanted hotel sales and marketing.  Easier just to ignore.

As USA Today reported last May, “The hotel guestroom telephone is being ignored more and more these days.”

You bet.

So for some years I have advocated yanking the things out of rooms – and
what’s caught my eye is there now, finally, is a rush to reinvent inroom phones and some of the ideas seem plausible.

But are the phones themselves too late to save?

Stop for a second however. Answer a key question: Would you miss the inroom phone if it vanished? Some say we would.

“Imagine walking into a hotel room that had no phone,” Chad Collins, VP of sales, Americas for VTech Communications, told Hotel Management for an August 2018 article. “While millennials and gen X guests are quite comfortable with emerging technologies and may not notice, the baby boomers and [the general public] are generally more comfortable with technologies that they are familiar with (i.e. guestroom telephone) and would consider it a fail to not have a phone in their rooms. This will remain the case for many years.”

Nah. Personally I would not notice that the thing was gone and I’m a leading edge Boomer. No fail in my scoring.

What about you? Do you really, truly, want that antique in your room?

I emphatically do not.

Even so, I am open to a reinvention of the inroom phone and at least some companies are trying. The exhibit here is an article in Hotel Business, What does the guestroom phone’s future look like?

Accepted by most experts is that we no longer use inroom phones to make outside calls. Maybe for inhouse calls. But outside, not so often.

In fact I cannot remember the last time I used an inroom phone to make an outside phone call.  I would say it certainly was in the last century (I started carrying a cellphone everywhere in 1999).  And, yes, I have more recently used an inroom phone to make a dinner reservation at an on property restaurant. But not to call other restaurants.

So the inroom phone makers are deep into a rethink of what functionality the device needs.

Joe Zhang, president, Bittel Americas, told Hotel Business: “We see the telephones in the future becoming simplified—speakerphone modules equipped with a number of one-touch, guest-service keys, with or without the physical dial pad.”

I like that – it might even persuade me to use the phone.

The key will be simplicity of use. If I have to think about how to use the thing I assure you I won’t – I won’t think about it and I won’t use it.

But very probably what I would much prefer in my room is an Alexa or Google Home device – and, yes, they can be put to use to make calls too.

I have both at home, use both daily, and would welcome seeing them in my next hotel room.

Can they be made easy to use? Sure.  

And we know how to use them anyway. Amazon claims it’s sold over 100 million of them.  We’re comfortable with them – concerns about spying aside – and it would be easy to build into an Alexa skills for opening hotel room blinds, adjusting the thermostat, turning on and off lights, and, yes, calling room service.

In my home I use those devices to turn lights on and off, to tell me the weather, to set a wake up alarm, to make phone calls, and it’s easy enough to set up to turn on the TV, to adjust the room temperature, and down the long list of proposed to-do’s for inroom phones.

There’s a pointed respect in which rethinking the inroom phone is a bit like rethinking the horseshoe in 1927.

Especially when the smart home devices are maturing fast and winning lots of users.

That’s my vote. Yank the phone – even if it’s a reinvented edition – and give me Google Home or Alexa.

Crying Out for an End to Overdraft Fees — Meet Grain Technology

By Robert McGarvey

Probably the single most despised charge at financial institutions is the overdraft fee – and a NerdWallet survey of the exact charges imposed by a selection of mid-sized (Navy Federal) through mammoth (Chase) institutions found fees at $20 (Navy Federal) and as high as $39 (KeyBank).

$35 is a particularly common charge in the survey.

Rapacious greed.

Ask yourself this. You present a Visa card at WalMart and the card is declined (and you know it’s because the balance is overextended and a payment is late).  Does the cashier say, “Sorry, bud, card declined and now you owe us another $35 for being a nuisance.”

That does not happen.

You walk out without your purchase but you aren’t dinged for a nuisance charge.

Overdrafts are different – charges are the norm – even tho at the financial institution all that happens is that bits and bytes shuffle around on a computer screen.

In the olden days, yes, a bounced check was a hassle. It generated lots of paperwork. Many hands of many clerks got involved. Very probably a fee was justified.

Not today. It’s all automated.

A few innovative, digital first institutions (Simple and Chime for instance) already charge no overdraft fees.  More will follow. But very probably many legacy institutions will cling to the fees because it’s easy money.

Some credit unions have worked up their own ways to help members dodge overdrafts – Hope Credit Union tell about its tools in this podcast – but many smaller institutions don’t know exactly how to handle this issue.

So they charge overdraft fees, the old school style.

It hurts consumers. It’s terrible for a financial institution’s reputation. But it is easy money.

So now third party work arounds are in the mix.

For the consumer the message is simple: you can keep your legacy checking account but make yourself immune to overdraft fees.

How?

Meet Grain Technology, a Northern California based start up on a mission to stamp out overdraft fees and, in the process, help thin file consumers create credit histories.  Win win.

For the participating credit union, it’s plug and play. The member links the sharedraft account to Grain and Grain takes care of the rest.

And Grain has been invited to play in the Arizona fintech sandbox where it is allowed to pilot its tools freed from some regulatory constraints. The company already has plans to offer its tools to students at Arizona State, the nation’s biggest university.

Exactly what does Grain do?  In a conversation with Carl Memnon, COO of Grain and a co-founder (hear the podcast here), the details emerged.

The building blocks are that Grain takes a new look at the consumer’s spending habits, income, expenses. It generates a proprietary algorithm. This lets it predict when a consumer’s linked checking account is likely to go into overdraft and Grain can offer an injection of cash to inoculate against an overdraft fee.

The charge? Grain sees its APR ranging from 12% to 15.99% and it envisions cash injections typically ranging from maybe $25 to a few hundred dollars.

Result one: no more overdraft fees.

Result two: the consumer builds a credit history that Grain will report to monitoring agencies.  For a thin file young adult that just may be a real blessing. Especially since many of those generations are averse to using conventional credit instruments.

Right now Grain is looking to partner with credit unions that want to help members sidestep overdraft fees. Most of those consumers, said Memnon, probably will come from the money center banks (with overdraft fees typically around $35 per incident).

What would prompt a B of A customer to ditch that institution in favor of a much smaller credit union? Just one overdraft fee could do it.  Especially when the recruitment pitch is that this tool will stop overdraft fees, period.

Memnon said Grain also envisions sharing its interest income with participating institutions.

All while essentially living up to the credit union mission of helping consumers manage their money better.


Find out more about Grain here: team@trygrain.com.

Listen to the CU2.0 podcast with Grain here.

The Cooperators Podcast Episode 6 Melissa Hoover, DAWI, on Worker Cooperatives

The deep dive into Workers Cooperatives continues in the Cooperators Podcast.  Last week we talked with Esteban Kelly of the U.S. Federation of Worker Cooperatives. This week it’s Melissa Hoover, executive director of Democracy at Work Institute, self described think and do tank that is doing a lot of thinking about worker cooperatives and how to form more of them, and how to position them to succeed.  

Hoover throws out lots of big ideas in this podcast but a key thought is that just maybe for many of us, as home ownership becomes but a dream, the real way to personal equity is a share of a business.

According to her for many workers that just may be a new, 21st century reality and it is a compelling driver for the belief that we will be seeing a surge in the numbers of new worker cooperatives.

Many of those co-ops likely will be in service businesses. Healthcare. Home care. Gateway jobs into the economy and if the worker can also be an owner, how great is that.

A technical point. We started this podcast using one service but ran afoul with technical difficulties.  In this podcast you will hear my recap of that short conversation.  And then you will hear the actual podcast recording – using a different service – with Hoover.

I kept that four minute starter recording however. For those who want to hear it, here’s the link.  It’s audible but the clicks and strange noises are annoying.  

The full Hoover DAWI podcast is here.


CU2.0 Podcast Episode 27 Hakan Nordfjell Gemalto on New Account Fraud

You want to make new account opening easy and fraudsters want to exploit that loophole to rob your credit union.

That is the gist of today’s podcast with Hakan Nordfjell, head of digital banking at Gemalto.  He tells about fraudster tricks and also the way financial institutions are fighting back.

He also warns that all your personal information is on the dark web and ready for fraudsters to exploit.  PII – personally identifiable information – just isn’t enough to open new accounts securely today. You need more weapons.  Nordfjell tells what.

This is information you need to know to protect your institution in what could be called the New Account Opening Wars.

Who’s winning?

Listen up.

Like what you are hearing? Find out how you can help sponsor this podcast here. Very affordable sponsorship packages are available.

Find out more about CU2.0 and the digital transformation of credit unions here. It’s a journey every credit union needs to take. Pronto.

The Irish Border and You and Me: The Wall Report


By Robert McGarvey

I remember sitting in my rental car, typically for an hour, maybe longer, just waiting to get through the Newry border crossing that separated Northern Ireland from Ireland.  It was always tense. That’s because, occasionally, bombs detonated and I did not want to be there when it happened.

Checks at the border, at least as regarded me, were always perfunctory.

It was the wait that got to me.

The drive time from Dublin to Belfast – my usual route in those days – is about two hours.

Plus the wait at the border.

Wasted time.  Pointless anxiety.

I cheered when the border checkpoints came down 20 years ago.

I’m not cheering anymore.

That’s because, as part of the Brexit deal or no deal, the specter rises of the 310 mile border again sprouting check points and, yes, fences, maybe even walls.  At one point there were 208 crossings and, over the years, I probably crossed at 20 of them and they all were nerve wracking and a time waster.

A hard border is very possible and even if you have no plans to go to Ireland and cross into the six counties, or vice versa, this just may impact you.

Pretty much everybody knows putting in a hard border in Ireland is nuts – but the EU and the UK are playing a game of chicken and it’s hard to say who’ll blink.

So a dumb border may in fact go up.

Exactly as steeper walls between the US and Mexico may.

Suddenly there appears to be a lot of interest in wall building.

Who knows where wall mania will erupt next?

As a business traveler, I just hate that. I remember – it wasn’t that long ago – when we had essentially no border controls with Canada.  Maybe some people were stopped but I know I wasn’t. I did not even show a passport on the first trips to Canada and I know that because I did not have a passport in those years.

Ditto Mexico.  I vividly remember walking into Juarez from El Paso and an hour later, walking back across the border. No stops. I didn’t have a passport but it didn’t matter because nobody asked.

Europe of course used to have thousands of border checkpoints but the 1985 Shengen agreement wiped out most of them.  You can cross from Austria into Germany, or Sweden into Denmark without a pause. And of course right now you can do similar crossing from Ireland into Northern Ireland.

Personally I have an Irish passport which wins me free passage into the Shengen countries – just about all of Europe – but now probably not into the UK.

Politicians – in Dublin and Downing Street – are gnashing their teeth. Many support what’s called the Irish backstop which says that if the UK and EU can’t come to a better agreement, the UK will remain in the EU customs union and, therefore, no hard Irish border is needed.

Isn’t that nuts? At least in the eyes of the people who voted for Brexit?

Pretty much.  

Invoking the backstop voids a lot of the insularity Brexit supporters had wanted.

But the backstop may be the best deal on offer for the UK.  Many warn that were a hard border restored in Ireland there would be a revival of so-called sectarian violence.  That’s difficult to predict and the generation of hard men, on all sides, that fueled “the Troubles” has aged out.  So who would pick up arms (and where would they get them)?

The violence in my mind is uncertain. The economic calamities that would afflict both Northern Ireland the Republic are certain however.  

A hard Brexit would be a catastrophe for the Irish, north and south.

It would also wipe out the nascent Northern Irish tourist business which has edged up in the 20 years of peace and for good reason. The Giant’s Causeway alone is worth the drive but, personally, I love the Antrim coast, walks in central Belfast, and a lot more.  Northern Ireland has been one of my favorite places to go over the past 30 years.

But put up a hard border and, guess what, it all goes poof.  

Walls are bad – bad for travel, bad for tourism, bad for economies.

I continue to think the UK will blink and will make a deal, however bad for it, that avoids a hard Irish border. The consequences of that border are too stark.

Yet I initially thought the English could not be so dumb as to think Brexit a solution to anything.

I just hope I’m not wrong again.

And I hope the rest of the world’s leaders get the message: Walls are bad.

Bonus: Here is an album of grand Northern Ireland photos by Toby Binder.

The Cooperators Podcast Episode 5 Paul Bradley on Co-Ops and Mobile Homes

Owning a mobile home park is like owning a Waffle House where the customers are chained to the table.

That quip is attributed to a leader in the mobile home industry.  

It’s a thought Paul Bradley, president of ROC USA in New Hampshire, often mulls. That’s because his company is in the business of helping mobile home park residents join together into a cooperative to buy the land their mobile home sits on.

Understand the weirdness. Mobile homes aren’t mobile, not usually. If they are, it would cost the owner thousands of dollars to move it.

They are in a poor position when it comes to dealing with rent hikes.

But when they are owners, everything changes.

Not one of the hundreds of deals Bradley has put together has gone bust. Not a one.

It’s a tremendous example of cooperative principles really working to transform lives.

A lot more can be done and, in this podcast, Bradley calls out for more efforts to bring cooperatives to the economically disadvantaged.

What’s stopping you?

Listen to the podcast here.

CU2.0 Podcast Episode 26 Carl Memnon, COO Grain Technology on an End to Overdraft Fees

Just say no more to overdraft fees.

And make this decision good for your members and also good for your credit union.

You may even grab a few customers away from Chase and the other money center banks.

That’s the promise of fintech startup Grain Technology.

In this podcast Grain co-founder and COO Carl Memnon tells about the company’s proprietary algorithm that lets it devise strategies for making fast loans to users who are about to trigger an overdraft charge and to also help those users find easy ways to start saving.

The latter is the why behind the company’s name – users will see their assets and their credit score grow “grain by grain,” said Memnon.

Memnon also talks about being in the Arizona fintech sandbox and the benefits for a small startup in playing in this sandbox.

Grain is actively seeking to align with credit unions that want to offer its overdraft protection service to members. In the podcast Memnon tells about the benefits to credit unions but a big plus is having cool technology that in effect let’s the member know they will see no more overdraft fees.

Listen up, you’ll find plenty of interest in this podcast.

Listen here.

BTW, the sirens you’ll hear are ambient noise in New York where Memnon was during the call.  If you’ve spent any time in New York you won’t even hear the siren. I couldn’t scrub it out so decided just to enjoy the New York moments.

Like what you are hearing in this podcast? Find out how you can help sponsor the podcast here. Very affordable sponsorship packages are available.

Find out more about CU2.0 and the digital transformation of credit unions here. It’s a journey every credit union needs to take. Pronto.

Are You a Typical Top Tier Traveler?

By Robert McGarvey

Just how typical are you? Travel data co-op ADARA set out to portray what makes top tier travelers special and the result is a paper titled Understanding the Secret Lives of Top Tier Travelers: Uncover search and booking behaviors of loyalty members.

So the obvious question is, am I typical?

The other question is: do airlines and hotels really understand top tier travelers?

Exactly what is a top tier traveler? Here’s the answer to the last question: “ADARA defined top tier as members with higher than basic status.”

Personally I’d quibble with that. To me top tier is platinum and higher (such as United’s 1K). But ADARA throws in Gold too, to use United’s classifications.

According to ADARA, 22% of airline loyalty members are top tier. 46% of hotel members are too.

ADARA explained that top tier status just is easier to earn at hotels. It said: “People can drive to hotels, they don’t need to live in a hub city to rack up status on a program, and most hotels base tier qualification on either stay activity or spend, while most airlines have adopted qualification policies requiring both.”

ADARA added that when it looked at all people who booked air between May and July 2018, just 17% had any loyalty status at all.

A curious factoid is that just 12% of all basic airline loyalty members belong to multiple programs.

17% of top tier airline members belong to multiple programs.

Color me surprised. I belong to three – the big three US carriers – and although I have status on none, membership is a convenience and the miles do add up. Why not grab them when I can?

44% of people who booked hotel rooms in that same time window had loyalty status, per ADARA. 12% of basic loyalty holders belong to more than one program. 24% of top tier holders belong to multiple programs.

Personally I have gold status with Marriott and Hilton but only because Amex Platinum delivers it as a perk. I belong to many hotel loyalty programs, however, usually because a useful perk is given to members.

ADARA elaborated on why so many of us belong to multiple hotel programs: “there are more hotel chains than major airlines in the marketplace. Also, there are immediate perks consumers get from enrolling in hotel programs (for example, free wi-fi, or a loyalty member discount that can be over 10%) which are strong incentives to enrollment before arriving and at the time of check-in.”

Loyalty – especially top tier loyalty – genuinely seems to create consumer loyalty, according to ADARA. Its data show that 49% of basic airline loyalty members searched multiple carriers before booking. Just 40% of top tier members did likewise.

With hotels loyalty means not so much. 54% of basic members searched multiple brands. 50% of top tier members did likewise.

ADARA also sorted the data to focus just on high frequency travelers – who booked four trips in the first six months of 2018 – and it found that 47% booked air with their loyalty program carrier and 63% booked their rooms with their hotel loyalty program.

Meantime, per ADARA, hotels and air carriers are getting more creative in efforts to boost loyalty program participation. It said: “Airlines and hotel chains are both increasing the range of redemption options for their services (wifi on United) or for partners (Hilton points applied to Amazon purchases). The winning brands are employing these approaches alongside auctions for exclusive events–such as back-stage passes to concerts–to ensure their programs have both broad appeal for infrequent travelers and a powerful draw to satisfy their elite members.”

ADARA argued that, to step up loyalty program participation, the big travel brands need to hone in on personalization. Send me photos of upgraded hotel gyms and I’ll yawn – I never use the things – but there are some others who always use the hotel gym. The key is knowing which is which and the data usually is available. But travel brands often just don’t use it.

Said ADARA: “Brands know that they must keep pace with changing consumer needs. Top tier travelers come in all stripes, and good customer service means a prompt Twitter conversation to some and a free martini to others. Loyalty members also expect their brands to truly understand them, and provide a level of relevant service in order to keep them loyal.”

Sounds right to me. Brands that genuinely know me just are the ones that I typically go to. Travel brands, mainly, seem laggards in this regard, or so I think.

What about you? Do you think the travel brands you use really know you? The comments are open.

The Cooperators Podcast Episode 4 Esteban Kelly on Worker Owned Co-ops

Presented by Robert McGarvey.

Listen in here


That sound you hear just may be a tidal wave of worker owned cooperatives.

At least that’s what Esteban Kelly, executive director of the U.S. Federation of Worker Cooperatives, is hoping for and working for and dreaming about.

He believes that just now be the time for worker owned cooperatives.

Why? Because for so many of us our economic lives are grim. Income inequality is the economic buzz work du jour but it’s just that old saying, the rich are getting richer and the poor, well, you know what’s happening with them.

Kelly says that in a decade maybe 0% of Americans will have zero assets.

That’s busted, baby.

Worker ownership of businesses just may be the cure.

And a lot of it is happening today. Retiring Baby Boomer entrepreneurs are selling their companies to their employees, often as a worker co-op. Home health workers are joining together and forming co-ops. So are cleaning crews.

There’s soaring recognition that it just is better to own a slice of the pie.

Listen to this provocative half hour podcast.

And know we have three or four more worker cooperative podcasts in the pipeline.  Now’s the time to learn more about this movement. And The Cooperators Podcast is where to learn.