SFCU

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Making a difference, one member at a time

by: Jessica Lewis

By offering its members services that extend past the traditional banking realm, Sidney Federal Credit Union is trying to prove that there is a difference between a bank and a credit union, and that difference is in the service its members receive.

Unlike a traditional bank, Sidney Federal Credit Union is a non-profit corporation. “We don’t have stock holders, so we don’t have to take every opportunity to maximize profits,” explained SFCU President and CEO James Doig. “We work toward a budget and try to return as much as we can.” Because it is not oriented toward maximizing profits, SFCU can offer competitive rates while keeping fees to a minimum.

“Our overall focus is member service. We’re always looking for opportunities to be more efficient and thinking about member service,” Doig said. Due to the set-up of the credit union, Doig explained, the members actually own the corporation, so the focus is always on member service.

“We as employees are all members, so we understand memberships and the part the rest of the members play. The whole philosophy is different,” explained Joseph Zummo, the vice president of marketing.

In an attempt to optimize member service, many changes were implemented in 2007. One such change took place in the Greene branch, where the credit union had out grown the facility. Due to cramped quarters, small offices, and a lack of privacy for the members, the office was overhauled at the end of 2006, and a grand re-opening was held. According to Doig, the new facility, which includes a new teller line, two new offices and more technology, is nicer for the members and the employees. Zummo hopes the new facility will help to inform the public about the facility, which is open to anyone who lives, works, attends school or worships in the Otsego, Delaware of Chenango County area, and their family members.

Doig explained that there is no age limit for members, saying that many SFCU members were in the youth or teen age groups. With this in mind, SFCU has increased their youth focus this year, by introducing the “youth zone,” and by sending out a new publication “Brass” to teen members in the 16 to 17 year age group.

“We’re trying to educate our younger members and potential members about how to handle credit cards and car loans,” Doig explained. SFCU started working to distribute Brass magazine in 2007. The national magazine partners with financial institutions to reach kids in the 16 and 17 year old age range. SFCU currently sends the magazine to 1,100 student members.

“When we sent out the third edition, we tried to gain a response by creating a contest the kids could enter. That way we know they are reading it. We’re pretty sure they are getting something out of it, and we feel good about that. It’s the right thing to do,” Zummo said.

Other new services that SFCU is offering this year are small business loans, an area that was previously non-existent. Although the company was almost strictly consumer based in previous years, business loans were added to the offering in 2007 so Sidney Federal would be better equipped to handle all of its members’ needs. “We’ve always had a lot of members who are small business owners, and sometimes they needed help that they couldn’t get from larger financial institutions,” Zummo said.

Doig explained that small businesses had limited options at SFCU before, but with the addition of the business loans, members can do all of their business at one place. Although it is taking a conservative approach to the new venture, SFCU hopes to focus on smaller businesses and loans of six figures and under.

In an attempt to help members afford some necessity items, the company is now offering Health Savings Accounts and heating cost loans. Rising costs in the health insurance market have made health savings accounts necessary for many Americans. The account works like a checking account but it has favorable tax treatment as long as the money is spent for qualifying medical expenses. “Over the next two years, we’re anticipating more of a demand for this type of account as costs continue to rise,” Doig explained.

Similarly, SFCU is offering heating cost loans to help families combat the rising cost of home heating fuel. “For families who are not on a budget plan, these loans can help spread out the high cost of heating fuel,” Doig explained. The loans can also be used to install a supplemental heat source, such as a wood stove or to replace a major heating source like a furnace. “We’re trying to help people in the area who need help heating their homes. Sometimes it comes down to a choice between heat, food and medicine,” Doig said, explaining that this is one way members might be able to stretch their available funds.

For 2008, Doig and Zummo hope to see more services for all of th credit union’s members. The company had 47,903 members as of September 2007 and $259,115,572 in assets. In the coming year, Doig explained the company would be making some changes to make SFCU more efficient. One way is by adding an e-signature feature for loans and paper work. The e-signatures will require members to sign with an electronic device, which will automatically send the paperwork to a record keeping system where it will be filed.

Other changes include an upgrade to the CU-online, which will offer more products and even more ease of use. SFCU is hoping the transition to the new system will be seamless and convenient for users.

Another major change will be in the way checks are processed. Currently it takes SFCU and other financial institutions several days to process a check, due to the time it takes to send the check to the federal reserve and back to the bank from which it originated. However, in 2008 SFCU plans to cut down on the hold time by converting the checks to images and transferring them electronically. Some retailers already use the electronic method to send checks, and Doig explained the change would make the system more efficient for all involved.

Among the goals for 2008, SFCU hopes to gain more members and possibly expand into more areas of the community. “We want to continue looking at expanding into under serviced areas,” Zummo said, explaining that in any situation the organization has to look at the relationship between the cost of the expansion and the number of members it would gain.

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