Credit Unions Behavioral Economics

Connected Credit Unions

We just returned impressed from a 1 ½ day behavioral economics workshop co-sponsored by our friends at Callahan & Associates. We pulled together 18 leaders from credit unions large and small from across the United States to discuss effective ways to use the dynamic science of behavioral economics to enhance their connections with members and their employees. Our sessions were held in DC in an industrial chic meeting room not far from the White House.

It was a great class. The participants, who came with a wide variety of titles and responsibilities such as CEO, CFO, COO, Marketing, Innovation, and Human Resources, were passionate about improving the financial well-being of their members and ensuring their employees are engaged and focused. We had spirited discussions about behavioral biases and some of the powerful tools that can be leveraged to create environments that make it easier for individuals to make smarter decisions without eliminating their choices or substantially altering the incentives.

Most rewarding was to see and hear the interaction at the breakout sessions. Tasked with developing ideas to improve member engagement, employee engagement and increasing the savings activity of members, participants developed a wide range of interesting and impactful interventions to test in their own organizations.

The session on member savings was especially powerful.  The groups developed a series of ideas, from the easy to implement (just ask members at every teller transaction how much they would like to save today) to ideas that require process changes.  For instance, a great intervention suggested rounding up loan payments and putting the “extra” amounts into a savings account.

The feedback was terrific and spotlighted the actionable concepts they were anxious to apply back at their organizations. We are often asked, “what is behavioral economics” and our answer is simple: BE is the science of how consumers analyze choices and make decisions.  The credit union leaders who attended last week are now equipped with behavioral economic tips, tools, and techniques to create environments that improve the well-being of their members and employees by making it easier for their audience to make smart choices.

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