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Credit Union Responds to 89% Increase in Payment Extensions

  • Written by Angie Meuten, Director of Special Accounts at Meritrust Credit Union

Meritrust Credit Union

COVID-19 response to help clients through financial fears

“We’re here to help when life happens.”

That’s the unofficial motto for our Special Accounts department, which oversees collections and recovery efforts for our 105,000-member Meritrust Credit Union. When life happened as it did this spring, and COVID-19 was officially named a pandemic on March 11, 2020, like so many of us in the industry, we’ve pivoted and planned to the best of our ability. All this while understanding, ultimately, there was no crystal ball to see into the future when it comes to the ever-changing health situation and its effects on jobs, the economy, schools, community well-being and individual lives. Understandably, there were – and are – fears.

When the pandemic began, our communities were grappling with the effects of the shutdowns and restrictions on life. Money is emotional when it comes to our financial well-being: Our ability to purchase groceries, pay the rent and buy gasoline are critical to daily life. After all, it’s how we care for our families. Our members were reaching out for help – even if they weren’t yet needing assistance, they were fearful anticipating the future and needed reassurance, and were proactively calling in to our team. We quickly realized our Special Accounts employees, whose comfort zone is in the world of collections, were understandably experiencing these same fears as our members in the new world of uncertainty.

We’ve implemented two focuses for our response during this extraordinary time. First, we knew we needed to take care of our employees’ well-being for them to have peace of mind and be able to turn around and support our members. Widespread talk about layoffs creates anxiety, and we needed to reassure our own teammates that we were not laying off employees. Working from home and feeling pulled in different directions was a cause for stress, so we became intentional on giving grace. Virtual conversations with our employees to give them a chance to talk about their fears also became more commonplace. We individualized assistance to our employees to help them in whatever way they personally needed. We encouraged all our employees to talk to our Meritrust financial counselors and seek out our employee assistance program for talking through fears with a certified therapist. Also, we referred them to our employee relief loan created specifically to help our employees. Once we had our employees’ fears settled, they were then able to focus on helping our members through their fears.

The second element of our response was in our approach to serving our members. Our credit union’s mission is to improve lives of our members, which heavily influences our service focus. While relationship-building and looking at each member’s situation as being unique have always been paramount to what we do, we were called to personalize the experience for our members, even more than before. We refined our processes to ask questions to figure out what they truly needed and give them options for extensions or reduced payments or payment skips or other tools so they were empowered to make the decisions best for them and their families.

We started seeing members who always made timely payments were affected by COVID-19; no one was exempt from the impact of this virus. We gave everyone – even historically late payers – a clean slate at the beginning of the COVID-19 pandemic. We extended grace periods for loans. We processed payment skips for free. We loosened up our guidelines to qualify for assistance. We knew the pre-pandemic world was not the world we were living in anymore. We talked through each person’s individual situation and empathized and got down to the root of the issues, referring them to our in-house financial counselors to help them navigate these unfamiliar COVID-19-world financial challenges.

We developed a decisioning process, CASH, that empowered our employees and gave them flexibility to really dive into the members’ situations and provide them creative options to help.

  • Creative – This isn’t a typical time, and the typical solutions aren’t always going to work for this time of uncertainty our members are experiencing. By being creative in our solutions, we’re giving individualized responses for members, such as stair-stepping back into payments and setting up a plan that helps the member be successful in their financial well-being goals in the future.
  • Aggressive – By being aggressive, we’re doubling-down on service to these members who have encountered financial hardships, helping our members be proactive and making sure our team is focused on solutions that help the member in the long term. Because we understand the importance of the client taking the step to communicate with the financial institution during a hardship, we’ve reinforced to our members this message by email communication to our loan account holders, and we regularly share reminders on our social media channels and through our weekly appearance on a local news outlet’s Q&A format interview. On a corporate level, Meritrust launched this spring a new brand statement, Financially Fearless™ and marketing campaign, to provide awareness of the importance of being proactive for financial well-being, letting our members know we are ready to help them be more confident through these times. While it certainly wasn’t planned to launch the campaign in the midst of such an unprecedented time, the campaign message has resonated with the community and provided a feeling of hope. We want our members to be Financially Fearless™ when communicating with us as their lender, knowing we are here by their side to get them through this.
  • Smart – We know that an overwhelming majority of members ultimately want to make their payments, and just need a little help from time to time. For the times that we aren’t able to come to a solution, we have to keep in mind we’re a financial cooperative, and we are making sure we’re balancing our service to our members with what makes sense from a financial perspective for our members’ dollars.
  • Helpful – Empathy reigns! We are here to help our members through the struggles they are experiencing by listening, asking questions, personalizing the solutions and guiding them through the uncertainty. “Let us problem solve with you,” is our approach.

The need is there. As of July, we’ve already seen an 89 percent increase in extensions and skipped payments year over year from 2019, and temporary loan payment reductions have seen an increase of 2,855 percent. The unfortunate reality is, COVID-19 isn’t going anywhere anytime soon. Early on in the pandemic, I had six plans for our COVID-19 response sitting on my desk, ready for implementing. As it turned out, things changed, and our plans did, too, to the point we had to pivot away from using any one of those plans. That’s the way pandemic planning works. While we all expect that this will continue to be a year of change, one thing’s for sure – the importance of empathy and empowering our clients and leaving them with dignity through this cannot be understated.

Angie Meuten, Director of Special Accounts at Meritrust Credit Union

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