Leveraging open banking technologies to stay ahead
Richardson, Texas, US
At a Glance
• Loan applications cut from 7 mins to 2.5 mins
• Increase in loan volume by 35% in 3 months
• Loan productivity grew at 17%
• Development of new ancillary loan products
• NPS score increased from 76 to 82
Texans Credit Union provides a full suite of financial products and services, including across digital and mobile channels. Launched in 1953, today it has more than 120,000 members across Texas, including the employees of the state’s 100 largest businesses. It operates 11 branches, and manages over $2.1 billion in assets.
For JJ Bai, Vice President of Programming at Texans Credit Union, growth has been achieved with the ability to stay in step with what their customers need. “There are always uncertainties in financial markets. Our job is to forecast the weather and prepare for the financial storms, when they come. It’s about creating opportunities while others are managing the chaos.”
Opening ecosystems
Technology has been key to this strategy, says JJ, and in recent years has taken the form of APIs and SDKs that allow Texans to develop and customize solutions. “APIs and SDKs…these are the fundamentals of open banking, which has become critical to competitiveness. Temenos has very comprehensive Rest APIs, which has really opened the door to custom development. That’s why the partnership has become so important.”
Texans started working with Temenos in 2011, deploying Loan Origination and Collections. One impact of the API architecture has been in connecting with third-party loan providers that may offer more suitable products to their members, . “Before, we would not have been able to accommodate these applicants. Now, we have a lending ecosystem that can serve them.”
Faster lending
The improvements continue to come. “Recently, we used the Temenos SDK to revamp the virtual capture aspect of our loan applications” says JJ. “It cut loan application times to just 2.5 minutes from 7 minutes, which led to an increase in loan volumes by 35% in the first three months, which is phenomenal.” A high NPS score of 82 is further evidence that the improved customer experience is working.
JJ explains that this has repercussions beyond the loans business.
Lending has become a really important channel into full membership. The membership growth rate from loans is outpacing overall growth rate.”
JJ Bai, Vice President of Programming at Texans Credit Union
Cross-selling and digitizing
He also points to the development of a new loans ancillary product that enables advisors to cross-sell debt protection add-ons, such as gap, warranty insurance, and multishield. It alone has API integrations with five different vendors.
We have been able to digitize the experience for customers. For example, applicants can view and sign-up to products online, including prospective loan repayment schedules, instead of us having to mail all this out in paper documents and wait for them to be completed and returned. So they are able to make more educated decisions in real-time.”
JJ Bai, Vice President of Programming at Texans Credit Union
The new loans ancillary product also brings improvements to the back-office by automating process flows. “It has been overwhelmingly positive with our test group, so we are now rolling it out to all our advisors.”
Green and flexible
Innovation at Texans is increasingly approached through the lens of environmental sustainability – and to that end, JJ is looking at migrating Loan Origination and Collections from on-premises to cloud, either privately-hosted or in SaaS mode. Alongside the green benefits of moving to cloud, there are also operational gains.
JJ has the ‘dev and test’ flexibility of cloud in mind with plans to expand Texans’ lending portfolio. One is a lease-like vehicle loan product with a balloon payment feature; and also new credit card options. He expects this can be replicated to other areas of the credit union.
When you consider how the Loan Origination and Collections platform has cut workflows and improved productivity by 17%, the cloud version should enable us to improve efficiencies even more.”
JJ Bai, Vice President of Programming at Texans Credit Union
Indispensable
This future planning speaks to the confidence that Texans has in Temenos. “Flexible, expandable, scalable, reliable – this is how we think about Temenos,” says JJ.
It’s a partnership that means we can keep bringing tailored solutions to our members, positioning us at the leading edge of the market.” He adds: “We want our members to think that they can’t do without us, and that’s exactly how we think about Temenos.”
JJ Bai, Vice President of Programming at Texans Credit Union