Banking on the Underbanked: How to make Prepaid profitable AND responsibly serve your customers Webinar Date: October 24 3 – 4pm EST PRESENTERS: George Hodges CEO New Market Partners, LLC Gene Kirby Advisory Board Chairman New Market Partners, LLC ABOUT THE WEBINAR: Prepaid cards are the fastest growing product in financial services today. What are the key drivers and what is the value proposition for customers? For your bank? This webinar will provide a market overview about who is using prepaid cards and why – as well as share experiences from recent prepaid launches in retail banks. You’ll also learn about some of the challenges banks face as they launch their product, such as interactions with regulators and senior management and how to identify target customer segments. THIS WEBINAR WILL COVER: Growing segment of bank customers are using prepaid cards as an alternative to traditional checking Prepaid cards look like checkless checking, but consumers and regulators see differences Customer experience for prepaid in a bank branch is very different than in a non-bank retailer TOP 3 BENEFITS TO ATTENDEES: Understand sub-segments of current bank customers who are using prepaid cards Understand key differences between reloadable prepaid cards and checkless checking Understand how offering prepaid cards in the branch is different than retailers and online To access the CBA website and register, click: http://eo2.commpartners.com/users/cba/session.php?id=9682
CFSI Underbanked Solutions Exchange
CFSI Underbanked Solutions Exchange November 6 – 8, 2012 New Market Partners is a sponsor of the Underbanked Solutions Exchange, a program of the Center for Financial Services Innovation (CFSI). The Exchange is a collaborative forum for mid sized banks and credit unions. For more information about joining the exchange, click this link to CFSI’s website. http://cfsinnovation.com/networking/exchange
CUES Webinar: Generating Non-Interest Income
Webinar Date: March 27, 2012 Presenter: George Hodges, Managing Director, New Market Partners, LLC Can’t solveliquidity problems? You may have an immediate opportunity to expand services to existing members and generate non-interest income. A dominant theme right now is the absence of lending opportunities. Unfortunately, most credit unions don’t have any control over this, so it begs the question: Are there other opportunities to grow revenue and expand your member relationships outside of lending? If any of the following scenarios fit your credit union, the answer is probably yes: 35% of your members are not profitable because their only product is a low balance checking or savings account Your serve a major university or large military base, but don’t seem have a good product fit for the student population or enlisted personnel You have a youth/young adult strategic initiative, but don’t yet have a strong mobile/card based product to support it You have an underserved designation with a working class population that is different than your current suburban, mass-affluent member base What each of these scenarios has in common is a large number of what the regulators call “underbanked” members. In this session you will learn how innovative credit unions are using outsourced technology and risk management to successfully, safely,and profitably compete with both large retailers and traditional check cashers by offering alternative banking products including: Reloadable prepaid debit cards Guaranteed check cashing verification Walk-in bill payment Person-to-person money transfers To access CUES website and register for this webinar,click: http://www.cues.org/shop-cues/distance-learning/type/4/id/558
Challenge to banks: Are your “unprofitable” customers really unprofitable? Existing underbanked customers can be your next profitable growth segment.
George Hodges blog post on CFSI’s Compass Principles Most banks we work with struggle with the Compass Principles value of “profitability and scalability” when looking at financial services for the underserved. Look at the current environment: consumer backlash to increasing fees on existing products and a hostile regulatory environment for small dollar credit products. To reference Arjan Schütte’s recent article, banks would seem to have two equally undesirable choices: be a mercenary or a missionary. He proposes a third path – be a visionary. I don’t know about that, but being a good data analyst and understanding your customer’s behavior is a start. Combining a basic segmentation analysis of your accounts with a look at their “whole wallet” of financial transactions can transform low balance, single account, unprofitable customers into a new profitable growth opportunity. Here are some scenarios that may fit your financial institution: You recently completed a segmentation analysis of your customer base and identified that 35% are not profitable because their only product is a low balance checking or savings account. Your have a major university or large military base in your community, but don’t have a good product fit for the student population or enlisted personnel. You have a youth/young adult strategic initiative, but don’t yet have a strong mobile/card based product to support it. You have a growing working class population that is different than your historical suburban, mass-affluent target customer. What each of these scenarios have in common is what the regulators call “underbanked” customers. According to the FDIC, this represents 23% of the population, totaling 60 million adults in the US. These are typically customers who only have a single savings or checking account with an average balance of [...]
Recapturing Revenue From AFS Providers
George Hodges post on CUES Skybox I had the opportunity to speak with a number of credit union CEOs and board chairs at CUES Symposium in Bonita Springs earlier this month. The dominant theme was liquidity and the absence of lending opportunities. Unfortunately that’s not a problem most credit unions have any control over at the moment, so it begs the question: Are there other immediate opportunities to grow revenue and expand your member relationships outside of lending? If any of the following scenarios fits your credit union, the answer is probably yes. You recently completed a segmentation analysis of your member base and identified that 35 percent are not profitable because their only product is a low-balance checking or savings account. You serve a major university or large military base, but don’t seem to have a good product fit for the student population or enlisted personnel. You have a youth/young adult strategic initiative, but don’t yet have a strong mobile/card-based product to support it. You have an underserved designation with a working class population that is different from your current suburban, mass-affluent member base. What each of these scenarios has in common is a large number of what the regulators call “underbanked” members. According to the FDIC, this represents 23 percent of the U.S. population, totaling 60 million adults. If you do a segmentation analysis of your member base, these are typically the members who only have a single savings or checking account with an average balance of less than $1,500 and are not an immediate lending opportunity. At first glance, this is your least desirable group of members for profitability and growth. But looks can be deceiving. If you only value their current account relationship, [...]
CUES CEO/Chairman Exchange
February 2012 New Market Partners is sponsoring and participating in the CUES CEO/Chairman Exchange. January 29 – February 2, 2012 in Bonita Springs, Florida. Click here for more information. http://www.cues.org/professional-development/conferences-and-networking/symposium
CBA’s Non-Bank Competition: New Players,Competitive Strategies featuring John Owen from Regions Bank
March 2012 New Market Partner’s Cash Banking solution will be featured in a session entitled: Non-Bank Competition: New Players, Competitive Strategies featuring John Owen from Regions Bank. Regions rolled out “Now Banking” in late 2011 utilizing New Market Partners Cash Banking strategy to reach underbanked customers. NOW Banking is a bundled product set including a reloadable prepaid card, check cashing and money transfer and bill pay services from Western Union. Register for CBA LIVE: http://www.cbanet.org/content.cfm?ItemNumber=18901&navItemNumber=19621
7th Annual Underbanked Financial Services Forum
June 2012 New Market Partners is a proud sponsor, speaker and participant in the 7th Annual Underbanked Financial Services Forum, presented by the Center for Financial Services Innovation. Register for the Underbanked Forum: http://www.americanbanker.com/conferences/cfsi/ Learn more about the Center for Financial Services Innovation (CFSI): http://cfsinnovation.com/
The Value of Deep Customer Knowledge: Understand Your Customers
George Hodges’ post on CFSI’s Compass Principles. Submitted by CFSI guest blogger on October 31, 2011 – 12:46pm By George Hodges, Managing Director, New Market Partners. New Market Partners works with financial institutions to provide alternative banking solutions and is a Sponsor of CFSI’s Underbanked Solutions Exchange. To quote Steven Covey’s perennial best seller 7 Habits of Highly Effective People, “Seek first to understand, then to be understood.” The foundation for a “win-win” customer relationship, right? Easier said than done when dealing with underserved financial services customers. Even the terminology is a barrier. We have conducted extensive primary research with these consumers, and I’ve never heard anyone say, “heh, I’m underbanked.” If you want do some quick consumer research for yourself, try it out on a young adult, which I did last week with my college age daughter. Ask what they need to be “fully banked?” They probably won’t understand that, so follow with “how do you want to be able to use that debit card you carry around with your iPhone?” The answer I got was, “Well, when I get some money, like a check from you, I need it right away, and it has to be available immediately, just like cash, but on my card. Then I like to check my balance from my iPhone before trying to pay for something so I won’t be embarrassed if my card is rejected, and I usually wait to pay my bills until I get the check because I don’t have any extra money, and you know I HAVE to reload my iPhone or my life would end. Then I say, “great, you are clearly underbanked! I happen to be an industry expert on this, let me explain how we [...]