Give Your Switch Kit a Makeover

by Sara Wolfe, Corporate Associate, Callahan & Associates Article first appeared on 8/23/2004

Encouraging members to use their credit union as their primary financial institution has been a challenge for the industry since its origination. Unfortunately, to accomplish this credit unions have used the same solution that has been around for decades without much improvement. Now credit unions are turning to the advantages of the Internet to thoroughly improve the archaic process.

A switch kit refers to the process by which a member can switch all of their accounts (checking, direct deposits, etc) over to their credit union. The industry standard used to be an envelope of papers or a brochure. Each form had to be filled out and signed by the member and then processed by a credit union employee (a very labor intensive and time consuming process). The screenshot from BECU ($4b, Seattle, WA) below shows how much easier the process has become.

Listing the two steps on the left-hand side of the page illustrates the simplicity of BECU's online model.

That is what I call an EXTREME makeover! Going from paper to digitally automated switch kits seems like an overwhelming task for many credit unions. However, as more credit unions find success with online switch kits they will continue to gain popularity.

After making the decision to makeover your switch kit and upgrade to an online process there are a number of technology issues to keep in mind. Dinesh Sheth, CEO of uMonitor, highlights key areas of process improvement and technology selection for credit unions:

• Compliance with the USA Patriot Act and OFAC checks must be automated
• ID verification in real time
• Integrate the credit union business rules and disclosures
• Complete the application process with online funding using electronic check, credit card or debit card
• Full integration with the core processor to create the member account number

If you would like to learn more about online switch kits, check out Callahan & Associates' research report. To receive your free copy of this report, valued at $99, call 1-901-757-1212 x 118 or drop us a line at info@umonitor.com

About uMonitor – Parsam Technologies
uMonitor financial technologies offer a wide range of online solutions specifically designed to help financial institutions provide the most up-to-date services. These highly configurable and customizable solutions enable financial institutions to increase profitability, generate revenue, improve regulatory compliance, and improve employee productivity while reducing costs. uMonitor technologies include New Account Setup and Online Funding with Switch Kit, New Loan Application Processing, Funds Transfer Service, Bill Presentment and Payment Solutions, Premium Account Aggregation Service, Document Management System, Advisor-Client Relationship Management and other services.

For more information, please visit www.umonitor.com or contact Gillian Smoot at gsmoot@umontitor.com or by phone at 901.757.1212, ext.7115.

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