For over 70 years, University Credit Union has served members of the university community with smarter financial solutions. Today on TechBullion, we are happy to discuss the future of the credit union industry and the opportunities available at the University Credit Union in this exclusive interview with the President and CEO David Tuyo.
Please tell us a little more about yourself?
My name is Dr. David L Tuyo II, DBA, MBA and I serve as the President and CEO of University Credit Union. I’ve worked in the financial services industry for over 20 years, with the majority of my time dedicated to serving credit unions. I’ve acted in a multitude of roles including COO, CFO, and Chief Investment Officer, but my focus as a leader has always been on building stronger and better communities through innovation and empathy.
I have been at University Credit Union for nearly 4 years now. During this time we have experienced incredible loan growth and developed innovative ways to better serve our members.
What is University Credit Union and what problems are you solving for your members?
University Credit Union is a credit union that specializes in providing financial services for members of the university community, which includes students, alumni, staff, faculty, and retirees.
Our goal is to give our members a financial edge. We do that by helping provide upward mobility for all of our members. We serve the unique financial needs of the university community. For example, financial decisions students make now can have a lasting impact for years. We provide financial education for this segment of our membership. Faculty members often travel abroad to teach at other universities, so we have designed our credit card products to address the challenges with using a credit card in a foreign country.
We strive to provide better financial services and solve some of the unique challenges that members of the university community face at different critical stages of their lives. Whether it’s in pursuit of their academic goals, or in support as they enter the workforce, we provide tailored financial services to serve our members and help them gain momentum in the upward mobility of their lives.
Could you tell us more about your leadership style and your key principles?
The business challenges have always been fun to solve, but the people are the secret sauce to any extraordinary brand. We take a people-centric approach to creating a winning brand. There is a high level of the traits described above, but discipline and courage are truly what drive our organization. Courage to trust your team, courage to trust your decisions, and courage to change decisions where new data justifies such activity. Discipline is another component to the secret sauce without which there would be no successful action.
What does a typical day look like for you?
The typical day as of recent has been quite different than previous years. However, like most people these days, there have been plenty of video calls.
While I balance a great deal of evolving priorities, I make a big effort to stay connected with every member of my team. The nature of a remote environment can be isolating, but I try to take a bit of time each quarter to do a one-on-one with all team members in order to hear and understand the challenges and successes that they experience on a daily basis. This is a large time commitment in order to connect with our nearly 100 team members, but the insight I gain from these meetings is invaluable.
It also helps inform my vision and strategic planning for the direction of the organization as we evolve through innovation and adaptation, not just to the pandemic, but also to remain competitive and relevant within the industry. Several new initiatives and process improvements have developed from these meetings.
What are some of the challenges that Credit Unions face in the financial industry?
Credit unions face some unique challenges within the financial industry. One obvious challenge is that we are positioned to compete with much larger financial institutions that have significantly more resources than us. Although our more limited access to resources does restrict some of our abilities to acquire and serve our members, there is an unintended benefit that results in a closer connection with our members and a more personalized, and ultimately more fruitful, experience for them as well.
Another major challenge for credit unions is from a tech perspective. Consumer demand for online and mobile banking support has been increasing steadily and the pandemic has only accelerated this demand for a flawless digital experience in all industries. Consumers expect online experiences in all areas of their lives that reflect the types of digital interactions that one might find on non-financial services, such as Amazon or Google.
This expectation holds us to a very high standard that has been a challenge for some credit unions to maintain. However, the positive side of this is that this consumer demand has driven a lot of tech innovation and development of our online services in the industry as credit unions simply cannot compete if they are unwilling to adapt.
What is the future outlook for credit unions and what will it take for them to not only survive, but thrive?
Credit unions have always been the best kept secret in the financial services world. The key to driving growth for credit unions is getting the word out there about what we can do for the communities that we serve and how our financial services make a real impact in people’s lives.
This has never been more true than over the past year. More and more people are looking to credit unions to solve their financial needs amidst some of the most unique challenges that most of us have seen in our lifetimes. Credit unions need to cultivate their relationship with their communities and help inform more people about the benefits that we provide. This is basic survival for credit unions.
In order to truly thrive, credit unions also need to be innovation leaders and deliver experiences that members want, expect, or need to support their financial growth. This is particularly true from a tech perspective and the demand is only increasing for online financial services and banking support.
Do you see Credit Unions being able to compete on an equal footing with larger Banks and Fintech companies?
There is inherently a challenge for smaller credit unions to compete with larger banks and fintech companies, simply based on the amount of resources that they have access to.
However, there is also a fundamental difference between credit unions and large banks or fintech companies, which in one way makes this less about equal footing as they are both walking down different paths.
Credit unions are not-for-profit organizations and they are built to serve their member’s specific needs. They are typically able to do more for their members since they can pass down would-be profits into savings and better financial offers. Large banks and big fintech companies are built for-profit and usually offer their services generically to many different types of customers.
Ultimately, this means that credit unions are able to excel in personal interactions and personalized support for their members in ways that larger financial institutions can’t. The challenge in this is for credit unions to find a way to maintain that member experience as they scale and develop their technological innovation.
How are tech innovations influencing the credit union industry, and what trends should we expect in 2021 and beyond?
Artificial intelligence will definitely continue to play a strong role in tech innovation and influencing the direction of the credit union industry.
We can expect that AI will continue to help improve the member experience in 2021 and beyond, particularly as it evolves as a technology and finds better integration with existing technologies and services. The first and most logical point of integration is for member support and I would expect to see the ability of AI to seamlessly converse with members significantly improve over the next couple of years.
How has University Credit Union adopted new tech solutions to thrive within the industry?
University Credit Union has always strived to be an innovation leader within the credit union industry and we have actively implemented many new tech solutions over the years.
Within the past year, we have rolled out “Royce”, our AI virtual assistant, to better serve our members both digitally and in our contact center. This has had a very positive impact for our member experience and has been well received.
We are also undergoing a core conversion this year in order to be able to better integrate with our fintech partners and automate more processes. This will provide our members with significant advantages as we will be able to serve them more efficiently and we will be better positioned to adopt new tech solutions as they become available.
Could you give us a walkthrough of your “Royce” AI Virtual Chat Assistant, how does it work? Is it an effective way of supporting your members?
Royce is our AI Virtual Chat Assistant that is embedded on our website. Members can ask questions to Royce and he will provide the best answer or connect them with personalized support if required. Royce is also able to help members process transactions through their online banking.
Members can also call in to our contact center and have a conversation with Royce to help direct them to the support that they require.
We find it to be a very effective way of supporting our members.
Was “Royce” developed before or as a result of the pandemic?
We were already in the process of researching AI pre-pandemic as it was a natural next step for our own tech innovation. However, the pandemic greatly increased our need for better online support and consequently this sped up the process of implementation.
Tell us more about your online & mobile banking services at University Credit Union, what are the benefits?
We provide a range of online and mobile banking services for our members. This includes our world-class online financial services and mobile app, FICO score access, a highly effective money management tool, as well as remote check deposit, which has been a great benefit during COVID-19.
Generally, our online and mobile banking services provide exactly what most members would need or expect from a financial institution and in this way, we are highly competitive within the industry.
On COVID-19, how did University Credit Union manage to adapt to succeed during the pandemic?
Adaptation and innovation have always been key to our success as a credit union, so when the pandemic hit, we already had some muscle memory that helped us react in a successful way.
Some of the key takeaways from the pandemic have highlighted our need to be flexible, resilient, and encouraged us to try to think differently from the rest of the industry. COVID-19 gave us an opportunity to gain a fresh perspective on how we always did something and revealed to us better ways of how we can do it. In some cases, in ways that we never imagined before the pandemic.
Some of the adjustments that we made for COVID-19 will likely remain post-COVID-19 as well. For example, working remotely has been a very positive experience and it is likely something that we will continue to do as it provides more benefits for our team than drawbacks. In fact, we’ve already hired several key positions within our organization from out-of-state during the pandemic.
How has the customer experience changed after 2020 and what longer-term impacts will it have on traditional banking/branches?
During the pandemic, we had to make many adjustments due to social distancing and lockdown measurements. However, we still wanted to ensure that our members got the support they needed during the pandemic.
In order to do this, we took a closer look at when our members needed to visit our branches and we made adjustments to our hours to better serve them.
We also looked at why they were coming into the branch and automated some of these reasons for a visit through Royce and better online support.
Do you have any data that shows people prefer using your AI support over other banking methods?
In the past year, Royce has already engaged with over 38,000 member interactions and saved us over $300,000.00 by saving over 300 hours of staff time and avoiding over 30,000 calls. For our call center automation, Royce was able to automate over 25% of our call volume and has handled over 9000 calls in just one month.
We continue to see it grow as new enhancements and learning continue to be rolled out through machine learning and optimization.
With the increasing demand for online banking services, would you like to talk about your security measures and what keeps your members safe?
The best security is ever-evolving as online threats continue to modify everyday in an attempt to steal data or access.
We are constantly enhancing our security measures to exceed the industry’s best practices and we are very confident in our ability to protect our members. We deploy state-of-the-art cybersecurity solutions and take additional measures with member verification to ensure that all of our members and their accounts stay safe with us.
How does your tech/product roadmap look for the rest of this year? Any new developments to keep an eye on in 2022?
Our core conversion is scheduled to take place at the end of 2021. After that, we will be doing a full assessment on what options we have to enhance the member experience and introduce the best and most innovative experiences to our members. This could include additional services from our fintech partners, new financial offers, better and more efficient financial services, as well as better online experiences.
You can also keep an eye on Royce as we go into 2022 and beyond. He is learning everyday and is becoming more proficient in supporting our members with every interaction.
For more information, visit the website: ucu.org
