CUANM Newsletter
April 1, 2021
Inside this issue
  Advocacy Update: 2021 Legislative Session  
 

This year's 60-day legislative session wasn't enough to get everything passed, including some CUANM-supported bills.  Overall, it did feel like a disappointing session with a record-low number of bills passed in the last 20 years that required a special session to hear cannabis and economic development bills. The new virtual committee hearings were much slower than traditional hearings, and many in the legislature didn't seem to have an appetite to pass new laws. 

Many of you are wondering about adult cannabis legislation, and the debate was still going on Wednesday evening at the first Special Session of 2021.  

This year, CUANM was a major supporter of SB313 and HB236, which would have created a new state-run public bank. This bank would have been a bankers bank, not a retail bank, and place for credit unions to gain access to low-cost capital. The bill died in committee.

CUANM worked closely with Think New Mexico on SB66, which would have capped loans at 36% above the prime rate. The bill died when the two chambers could not come to concurrence on the bill, and it was not sent to the governor. Unfortunately, this means that loans in New Mexico remain capped at 175% for the foreseeable future. 

We also supported HB302, which would have required all New Mexico students to pass a financial literacy class before they can graduate from high school. Despite many members supporting the bill from both sides of the aisle, the bill ran out of time this year. 

We understand that many of our member credit unions hold liquor licenses, which have been a valuable asset. The updates to the liquor control act will affect some of those assets. HB255 cleaned up many issues that New Mexico has had with selling alcohol and will make it easier for restaurants to obtain liquor licenses. However, it remains to be seen how the "soft landing" for current package license holders and those who own restaurant licenses will work out. 

 

Top

  CUANM Updates  
 

 

Several CUANM members were able to meet with  Rep. Teresa Leger Fernandez in March. In February she missed our meeting during GAC and vowed to make it up. We were happy to meet with her virtually in March, where we discussed the benefits and strength of credit unions, and expressed concerns about PPP and CARES act funding. She was very responsive. 

If your credit union has concerns about PPP loans, please contact CUANM. We have found congressional staff to be very understanding. 

 

Top

  New Co-Op Park at LASCU Headquarters to Bring Co-Op Values to Los Alamos  
 

Several New Mexico credit unions are working together to open the new Co-Op Park in Los Alamos on July 3, World Co-Op Day.  

The new Co-Op Park will be built in cooperation with the members of Keep It Co-Op, the association of New Mexico credit unions and co-operative businesses. Working together, we are investing in our communities, serving our members, and now we are all coming together to create Los Alamos' new Co-Op Park, a recreation space dedicated to the principles of community ownership in Downtown Los Alamos. 

"Many people don't realize the strength of a co-op, and how common they are," said Matt Schmidt, CEO of Los Alamos Schools Credit Union. "Across Los Alamos, and the world, co-ops have helped people take an ownership in something much bigger than they could have alone. Credit unions are an excellent example of member-owned co-ops."

The new Co-Op park, on Central and 10th in Los Alamos, will be adjacent to the new LASCU headquarters. It will provide a place for food vendors, music, and community gatherings. Our cooperative events have included Shred Days for credit union members, allowing them to safely shred personal papers, and we've also sponsored the successful  Los Alamos Summer Concert Series, and more together.

Co-Op Park will officially open on July 3, 2021, which is World Co-Op Day. But we are now launching a GoFundMe campaign to cover some of our construction costs for this monumental undertaking. You can find more at: https://www.gofundme.com/f/coop-park.

Locally, our Keep it Co-Op members include: Los Alamos Schools Credit Union, Del Norte Credit Union, Little Forest Playschool, Zia Credit Union, Los Alamos Co-Op Market, and Bathtub Row Brewing Co-Op. 

A Co-Op is an organization that follows the Cooperative Principles and works to build a community-focused economy.

The Cooperative Principles are:

1. Voluntary and open member-ownership
2. Democratic member-owner control
3. Member-owners' economic participation
4. Autonomy and independence
5. Education, training and information
6. Cooperation among cooperatives
7. Concern for community
8. Diversity and Inclusion

Find out more at Cooppark.org. 

About Us: Keep it Co-op is an association of New Mexico credit unions and co-operative businesses. Working together, we are investing in our communities and serving our Members.

 

Top

  How to Combat Cyber Attacks with AppGuard  
 

By Sean SMITH, MBA
President / Owner
Smith Financial Consulting LLC
 

In February, CUNA Mutual wrote about the dangers of ransomware, and what developers are doing to combat it. But, there is a way you can protect yourself. 

Ransomware developers and affiliates have been telling victims they must pay the ransom or stolen data and internal company secrets will be publicly released. Unfortunately, not everyone has been a believer. Six and seven-figure demands have become routine among ransomware attacks with the average ransom payment in quarter two of 2020 reaching $178,254, a 60% leap from the $111,605 average in quarter one according to the Coveware Quarterly Ransomware Report. 

"Credit unions need to be looking out for ransomware techniques. These cyberattacks have no boundaries and are truly a global issue," said Carlos Molina, Senior Risk Consultant at CUNA Mutual Group. "Ransomware has grown in frequency and severity significantly. The average ransom payments have climbed exponentially in the last few years." As a member of the CUANM, you can provide your members with the only software that has been able to stop "never-seen-before" zero-day malware from hacking personal and business computers with Windows operating systems. That software is AppGuard. 

With over 1 million new never-seen-before zero-day viruses being launched each day and distributed by the millions around the world, and over 3 billion fraudulent emails a day, AppGuard is a "must have" for personal and business computers. AppGuard customer families, especially those with children, are banking, shopping communicating, socializing, playing and researching or running their businesses online unprotected against new Zero-Day viruses regardless of what antivirus product they may have. AppGuard knows when a computer or app on the computer is being asked to do something that is not normal. It blocks that activity and captures any malware that may be trying to compromise the computer.

 An average user will see that thousands of suspicious things have occurred every month which were stopped by AppGuard. AppGuard does not require changing anything on personal computers, just "set and forget." It works alongside any antivirus your members may have. AppGuard is an affordable value if used with Windows Defender because Windows Defender is free. AppGuard stops and isolates the virus, the antivirus removes it. If you would like to learn more about how AppGuard can protect your credit union, as well as your members personal computers, please reach out to our local New Mexico representative, Gene Polito at gene@smithfinancialconsulting.com

 

Top

  Are you offering your members the payments options they want?  
 

By: Sean Smith, MBA
Smith Financial Consulting 

It's no secret that payments are ever evolving. Up until about a year ago in March 2020, we were told that tokenized payments, or "the pays" were the next big thing to payments. We are talking about Apple Pay, Samsung Pay, Google Pay and others.

 However, while there were articles after articles written about these new payments options, adoption was extremely low by consumers. appleinsider.com reported that as of Q1 2019, ApplePay adoption was only at 9% in the US, while PayPal was used by 44% of Americans. Standard credit cards by comparison had adoption rates of 80% nationally. In a study published by Loup Ventures in November 2020, we saw usage of Apple Pay dramatically increase, most likely as a result of the pandemic. They reported an additional 66 million users from September 2019 to September 2020, for a total of 507 million. This means that over 51% of all iPhones are active ApplePay users. On a transactional level, they also reported that ApplePay saw a six month increase of over 30%. 

Perhaps most importantly to credit unions is that ApplePay has also seen a 20% increase in adoption from banks and credit unions. At the same time, we now see that 74 of the top 100 retailers accept ApplePay. Does your credit union have contactless payments available for your members? Have you considered contactless plastics, tokenized "pays" options? Have you considered the costs to add these payments options and have you considered the lift in interchange had you offer them to your membership? 

According to CNBC, in an article published November 2020, MasterCard reports that 51% of all Americans are using contactless payments already. This means tokenized payments like ApplePay, Samsung Pay and Google Pay, as well as RFID contactless cards. With a payment option this popular nationally, credit unions need to look at their product offering and make sure they check this vital box. If you don't yet provide contactless payments options to your membership, and have questions about what makes the most sense for your credit union, let us know and we can help. Each option has different associated costs, as well as differences in interchange collection. 

The pandemic has changed the psyche of American consumers, so we must act quickly to make sure we are providing them with what they need, or potentially lose them to a bank or credit union that already does.

 

Top

  Living our Shared Purpose  
 

By Bob Trunzo

CEO, CUNA Mutual Group

I have always been proud of our purpose at CUNA Mutual Group, but it has never been more relevant than it was last year. We believe a brighter financial future should be accessible to everyone. That means offering financial protection and opportunities, especially during a pandemic, with many facing joblessness and difficulty making ends meet. 

It means working to knock down barriers to financial democracy, especially when our nation struggles with unrest, systemic racism and polarization. It means finding new ways to reach people when most of us are spending more time at home than ever before. And it also means quite simply, putting people first. We worked with you last year to help protect your members, paying out over $36 Million in COVID-related unemployment and death claims. 

We also extended premium payment grace periods on many of our consumer products, allowing your members to keep their coverage, even if they couldn't make the payments. 

We worked with many of you to create Diversity, Equity, and Inclusion (DEI) pledges, education, the DEI Collective, and CUNA Mutual Group's Social Justice Statement. We lobbied for Community Development Financial Institutions (CDFIs) and Minority Depository Institutions (MDIs) to help Credit Unions better support underserved populations. And we will continue to collaborate to remove financial barriers for everyone. 

In 2020, conducting business and managing our lives on a mobile device accelerated from a gradually increasing trend with members to an expectation of today - right now. So, we are doubling down on our efforts to give you the digital support you need to be successful in reaching and serving your members.

 Our investments in data, analytics and digital services will be our primary focus for the foreseeable future. When I say we put people first, we start within. We increased communication and updated processes to provide more support and flexibility to our workforce. We focused on capacity and well-being. We adjusted when necessary and did so quickly. All of this allowed our employees to take care of you and your members. In fact, we found that many of our employees were so diligent about caring for those they serve that we had to remind them of the importance of self-care. 

We learned that caring for your employees holistically enables them to serve others. Thank you for continuing to choose us as your partner on this journey and for believing in our shared purpose. We are stronger together as evidenced by the great work we've done together over the last year and many years before that. 

We look forward many more ahead.

 

Top

  Emotional Engagement: Differentiate Your Members' Experiences  
 

By Steve Heusek, Sr. Manager, 
Customer Intelligence 

To better understand how emotions shape members' perceptions of their credit unions, CUNA Mutual recently conducted research that examined emotions at two different levels: 

Anxiety related to consumers' overall financial situation 
Emotions arising from specific episodes consumers have while using different financial products This article shares a few highlights from this new study. New Insights About Financial Anxiety Unsurprisingly, research firms, such as JD Power, Gallup and Kantar, have tracked an Increase in consumers' anxiety, worry and stress since the beginning of the pandemic. Rising financial anxiety has important implications for financial institutions: Consumers experiencing financial anxiety tend to give their primary financial institutions significantly lower loyalty ratings. 

These consumers also tend to give lower customer experience (CX) ratings to their most recent interactions using their checking account / debit card, loans, insurance policies and savings/investment products While it's unfortunate that some consumers are experiencing elevated levels of financial anxiety, it represents a tremendous opportunity for credit unions to turn this anxiety into a positive emotional experience for their members. 

Emotional Engagement: 

Differentiate Your Members Experience To do so, credit unions need to identify members experiencing financial anxiety. Once these members are identified, credit unions can then decide what relief, if any, to extend to alleviate these members' financial anxiety. 

Emotions Arising from Using Checking Accounts / Debit Cards Our research also closely examined the role of emotions when using checking accounts / debit cards. Negative experiences using these products can elicit strong negative emotions, including frustration, stress and anger. 

Fortunately, we found that fewer consumers whose primary checking account / debit card is from a credit union have negative experiences (26%) than consumers whose primary checking account / debit card is provided by some other kind of financial institution (44%). When consumers did have a negative experience, the rise in their negative emotions was accompanied by CX ratings that were 30+ percentage points lower than those of consumers who did not have a negative experience. 

Our research revealed four broad categories which captured most of the negative experiences reported by consumers:

Customer service 
Product functionality (something about the product didn't work as expected) 
Fraud 
Fees: Credit unions seeking to reduce the incidence of these negative experiences will need to determine the causes of these negative encounters. Once these are identified, credit unions can use member input, e.g., member interviews or focus groups, to re-engineer member journeys in ways that deliver a positive emotional experience. 


As we've just seen, emotions play an important role in what members think of your credit union and the experience you deliver.

 

Top