Credit unions are customer-centric businesses. They attract a close-knit community of loyal members that love the one-on-one attention that credit unions provide. And since customer service is so central to credit union operations and core principles, it makes sense that these institutions would want to do everything they can to keep their members happy. But how do they keep everyone satisfied? With back office outsourcing, credit unions have more time and resources to focus on their members. Here are a few compelling reasons why you should consider back office outsourcing for credit unions.
What is Back Office Outsourcing for Credit Unions?
To understand why back office outsourcing improves credit union customer service, you must first know what it involves. Back office outsourcing is delegating some or all of your back office processes to a third-party provider. The specific back office tasks the provider handles vary from vendor to vendor. Some are end-to-end back office providers, meaning they take over your processing, allowing you to focus solely on the front or middle office. Other vendors provide just one or two specific services, such as automated call centers, data analytics, or portfolio management.
If you’re looking to improve your customer service specifically, here are just a few of the back office tasks you can delegate to an experienced third party:
- Fraud detection and risk management
- Payment processing and repayment scheduling
- Member contact information and communication preferences
- Loan or credit card application decisions
- Level 1 support
- Customer web portals
- Automated call centers
- Back office to front office communications
- Staff training and recruitment
You may be thinking, “How do some of these services relate to managing customer relationships?” While the front office handles most direct customer communications, the back office also plays an important, if indirect, role in this process. Many of the services listed above make it easier for front office staff to perform their jobs. However, customers also appreciate when credit unions have efficient back offices, even if they don’t realize it.
Think of it this way: would you rather join a credit union that is well-organized and efficient or one that’s disorganized and inefficient? The back office sets the tone for the entire business. When it runs smoothly, everything else can too. Here are some ways to leverage your back office to maintain a better rapport with your members.
Want Better Customer Service? Improve Your Back Office
| Advantages of Back Office Outsourcing for Credit Unions | |
|---|---|
| Frees Up Staff | When your back office is taken care of, you can spend more money and resources on staff for your front office. |
| Increases Customer Trust | By outsourcing the back office processes to the experts, your customers can be confident their data is in good hands. |
| Answers Member Questions Thoroughly | Outsourcing your back office means that your front and back office can answer members’ questions more thoroughly by sharing information. |
| Stays in Touch with Members | If your members move or change their preferred method of communication, your provider will keep track of these updates. |
| Enables Fast Application Decisions | Back office providers use advanced automated decision-making software to speed up the loan decision process. |
| Provides Reliable Technical Support | When you outsource the customer web portal, you can reduce costs and give your customers better technical support. |
| Supports Competitive Rates | With a reliable back office predicting risk, you can structure attractive loans for members without putting your bottom line at risk. |
| Enables Focus on New Services and Products | Less time spent on the back office side of your business operations means more time spent on developing new services and products. |
Back office outsourcing for credit unions could significantly improve customer communications and retention. There are eight main reasons why back office outsourcing for credit unions has an enormous impact on your members:
#1: Outsourcing Frees Up Your Staff
When your back office is taken care of, you can spend more money and resources on your front office. This could mean having more customer service representatives available to handle member inquiries. Rather than burning the candle at both ends trying to manage the back and front office simultaneously, your in-house staff can focus their full attention on credit union members, making them feel truly special.
#2: Efficient Back Offices Increase Trust
The back office handles all data collection, storage, governance, analytics, and security. It’s also the back office’s responsibility to assess and manage risk using methods like predictive data analytics. By automating and outsourcing this process to the experts, your customers can rest easy knowing that this data is in good hands. You can even set up alerts for suspected fraudulent activity on your customers’ accounts, keeping them safe 24/7.
#3: You Can Answer Your Members’ Questions More Thoroughly
When customers call in, they want to speak with someone who can confidently answer all their inquiries. It’s easier for your customer service representatives to do this if they can access all the most updated and relevant information. Outsourcing your back office operations means that your front and back office share more of this information.
#4: It’s Easier to Stay in Touch with Your Members
Your back office manages details like member contact information and communication preferences. By outsourcing this service to a capable call center or back office provider, you can maintain positive relationships with your customers. And if your members move or change their preferred method of communication, your back office will keep track of these updates. It shows customers that you listen to their needs and value their membership.
#5: Members Receive Application Decisions Fast
No credit union member wants to wait weeks for a decision on a loan or credit card application. You’ll attract more customers if you can get them a decision the same day—or better yet, in minutes—after they apply. Back office providers can use advanced automated decisioning software to speed up this process.
#6: Technical Support is More Reliable
Third-party back office providers also offer custom web portals where members can access their information, apply for loans or cards, or chat directly with customer service representatives. Usually, this technical support system would be difficult to manage and costly to maintain. Still, when you outsource this system, you can reduce costs and give your customers better technical support.
#7: You’ll Offer Members the Most Competitive Loans and Rates
Credit unions are known for having exceptionally competitive lending terms and interest rates. But this is only possible if the credit union accurately assesses risk. With a reliable back office predicting risk using the best data analytics, you can structure attractive loans for members without putting your bottom line at risk.
#8: You Can Focus on New Products, Services, and Promotions
Less time spent on the back office side of your business operations means you can spend more time thinking about new services to offer your members. And these new products and services are easier to introduce because the back office service provider will incorporate them into the system for you. Back office data analytics can also help you find pain points or opportunities to improve the customer experience.
This list of benefits isn’t comprehensive either. When credit unions outsource their back office tasks, they often notice many more subtle advantages unique to their business operations and workflow. You’d be surprised what you can accomplish when you no longer have to think about your back office.
The Most Effective Way to Outsource Your Back Office
To gain all the benefits of back office outsourcing, credit union decision-makers should find an end-to-end provider with experience in the credit union and lending industry. This is very important. Generalized back office services aren’t the right fit for credit unions because the provider may not understand compliance issues, loan, and credit card risk, data security, or other challenges unique to the financial sector.
To gain all the benefits of back office outsourcing, credit union decision-makers should find an end-to-eInstead, you should work with a back office provider that understands your credit union inside and out. They’ll not only make sure your members get the highest level of service, but they’ll also help you stay ahead of significant trends and technological advances in your industry.
Your back office system should constantly evolve and become more efficient as new technology becomes available. Your customers will also appreciate the convenience of a sleek, modern banking system. They can quickly check their accounts, make payments, and take advantage of your services without snags along the way. It’s the perfect recipe for customer satisfaction and loyalty.
Back Office Outsourcing Solutions with defi MANAGED SERVICES
If you are looking for an industry-leading back office outsourcing provider that offers professional, white-glove service, look no further than defi SOLUTIONS. Our defi MANAGED SERVICING provides a single hub, digital interactions, and intelligent virtual assistants to bring everything together.
With defi MANAGED SERVICES, you can ramp up a new or beef up your existing back office operation with white-label, outsourcing services for:
- Inbound call handling and fulfillment.
- Return mail processing.
- Payment processing.
- Collateral management title work.
- Accounting.
- Cash management.
- Back office payment processing.
- Default management (collections, bankruptcy, repossessions, recovery).
- Lease maturity management.
- Remarketing.
defi MANAGED SERVICING uses artificial intelligence (AI) and Contact Center as a Service to boost operations and processes related to auto loans, leases, and leased vehicle dispositions, reducing budgetary expenses and improving customer service.
Getting Started
defi SOLUTIONS is redefining loan origination with end-to-end software solutions that enable lenders to automate, streamline, and deliver. Borrowers want a quick turnaround on their loan applications, and lenders want quick decisions that satisfy borrowers and hold up under scrutiny. With defi MANAGED SERVICING, lenders can improve operations and processes related to auto loan servicing, leases, and the disposition of leased vehicles, cutting expenses through automation and outsourcing services. For more information on what to look for when considering back office outsourcing for credit unions and how we can help, Contact our team today and learn how our cloud-based loan origination products can transform your business.
