Converting Indirect Borrowers
A Special White Paper Report:
Converting Single Transaction Indirect Borrowers to Multi-Relationship Members/Customers
Historic Growth. According to industry reports, indirect lending is growing at a record pace. For credit unions, Callahan’s reported that the ratio of indirect loans to total outstanding auto loans was 54% as of June 30, 2015. As discussed in the white paper, over 2000 credit unions now participate in indirect lending, which includes over 60% of all credit unions with at least $50 million in assets.
Great News? Consider that these record setting statistics come with a downside: With the historic low interest rate environment coupled with increased lender competition, interest rate margins are down significantly. Add in the dealer participation fees and those profits become razor-thin.
The Solution: Greater Wallet Share. It’s very clear that your institution must generate income from other services to keep that indirect borrower profitable. However, it has always been a challenge to convert these indirect borrowers…many of whom are not even aware they are members/customers of your institution.
Challenge & Opportunity. Our own research found that over 62% of institutions reported had “No Success” in this area, with only 31% reporting at least a 10% conversion rate. The good news – there is lots of room for improvement.
The last project/study on this subject was published in 2008 by CUNA Lending Council. This topical yet, revealing white paper analyzes what has changed and stayed consistent since the CUNA report, references marketing studies on Gen X and Gen Y, includes the actual feedback from a sampling of our 63 credit union responders from industry LinkedIn groups, some with excellent data and metrics, and offers conclusions to help guide those interested in starting or improving their existing strategies.
Stop leaving money on the table. Download your copy of this important white paper today!
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