At a Glance

●  Enables training of new users in less than one-half day

● Increase in the number of effective calls per day and members reached

● Delinquency reduction while improving expense efficiency in asset recovery

 

LBS Financial Credit Union, headquartered in Long Beach, California, since 1935, with $1.3 billion in assets and 124,000 members, was seeking to improve its existing collection management system. Searching for a real-time, user-friendly system with flexible queuing features and robust reporting capabilities, they explored a number of collection management systems before choosing Temenos digital banking Collection. Al Parent, Vice President of Collections, cited that the existing Temenos digital banking interface with their core provider made a specifically positive impact during the decision-making process.

Process Improvements

Since the implementation of the Collection module, LBS has experienced an increase in the number of effective calls per day, with a corresponding increase in the number of members reached. Temenos digital banking has contributed not only to a delinquency reduction but also to improved expense efficiency in their asset recovery effort by enabling a reduction in staff scheduling and the elimination of overtime. The ease of queue set-up and the ability to download reports to Microsoft Excel for “slicing and dicing” are features that enable management to focus the efforts of their staff where it is most beneficial.

The ease of use has made the collection staff very comfortable with the software and enables training of new users in less than one-half day. “Temenos digital banking is a more intuitive system, which has enabled us to become more efficient,” offered Parent. “Additionally, we have utilized the capabilities of the software to assist in our marketing efforts.”

Quality Results

The choice of Temenos digital banking has provided significant improvement in both productivity and efficiency. LBS looks forward to continued success and would definitely recommend Temenos digital banking to others looking to improve their asset recovery process. “Based upon our experience to date and the fact that we have become such fans of Temenos digital banking, we look forward to future product offerings from Temenos,” Parent comments.

At a Glance

● 100% increase in automation

● 60% of all loan decisions now automated

● 87.5% faster in audit and fund loans

● 135% Consumer lending portfolio increase

● 27% Membership base increase

● 97% customer satisfaction rating

 

FORUM Credit Union aims to help its members achieve their financial dreams by offering innovative products and high-quality customer service. Headquartered in Fishers, Indiana, it was initially formed to serve the employees of the Indiana Bell Telephone Company. Today, the credit union manages total assets worth $1.9 billion and provides personal and savings accounts, home and auto loans, credit and debit cards, financial advisory, and business banking services to 171,773 members.

Embracing advanced technologies has long been a central part of FORUM’s growth strategy. The credit union was among the first in the USA to offer checks as a payment method in the 1980s and was also an early adopter of fingerprint and facial recognition authentication systems for its mobile app.

Meeting increased demand

FORUM’s membership had expanded by 52% in the ten years preceding its adoption of Temenos, with particular growth in requests for auto loans. At the same time, members increasingly expected a slick, seamless digital experience when they interact with their financial service provider. However, FORUM struggled to process rising application volumes quickly with its previous loan origination system, increasing the risk of members switching to a competitor.

Specifically, FORUM wanted a platform that would accelerate and automate as many steps in the loan origination process as possible and enable the consumer lending team to set their own procedures for whether an application should be approved. It was also essential to connect the new solution to the systems of FORUM’s auto dealer partners, which provide indirect loans on its behalf.

Implementing a customizable, integrated solution

To modernize its auto loans business, FORUM decided to implement Temenos Loan Origination (2015), which provides intelligent decisioning functionality to manage the application, risk calculation, and loan disbursement processes. The Temenos solution enables the credit union to create unique approval rules and decisioning models for direct and indirect auto loans, based on its own lending and risk guidelines.

Another major plus for FORUM was the Debt Protection panel within the Temenos platform. The credit union uses the feature to enhance its auto loan service by providing an accompanying quote for insurance. Through the integrated Trustage Protection Advisor Connector, FORUM can generate quotes for Guaranteed Asset Protection (GAP) and Mechanical Repair Coverage (MRC) services from Trustage Financial Group.

“The solution was very easy to configure” explains Chris. “And whenever we experienced challenges during the deployment, we worked closely with Temenos to keep the project moving forward. Temenos understands that every financial institution is unique and possesses distinctive goals. Having spent time listening to our requirements, the Temenos team set us on the path towards realizing our objectives.”

Accelerating approvals

By deploying Temenos, FORUM increased the levels of automation in its loan origination process by 100%.

The impact has been profound, says Chris.

Extending value

The story of FORUM CU’s partnership with Temenos is one of continual improvement. During the almost-decade long partnership, FORUM CU has extended the technology to its consumer account origination business and small business account origination businesses.

Today, the powerful engine manages over 60% of all lending decisions, helping to minimize the risk of human error, protecting against fraud, and freeing up time for operational teams to focus on value-add tasks, such as exception handling.

Meanwhile, automations have significantly reduced the time it takes to develop new products. This has emboldened the credit union with a newfound agility. For example, during the COVID-19 pandemic, the credit union launched an emergency loan scheme within just a few hours—a process that would have taken several weeks with the old system. Today, that can be done in just 10 minutes.

More time to be productive

Chris says that a major impact of automation is not simply measured in time savings, but what colleagues can do with that time. “They don’t feel overwhelmed by the number of applications coming through. So they can spend more time on applications that need more attention, and make more quality decisions.”

Automations have also made it easier for FORUM to cross-sell and up-sell other savings and credit services to loan applicants, driving revenues and strengthening brand loyalty. The financials speak for themselves. In the nine years since deploying the Temenos platform (Loan Origination in 2015, and then Account Origination in July 2018) the credit union increased its loan portfolio by 135% (from $382m to more than $900m) and its membership base by 27%. Additionally, FORUM’s consumer lending division saw consumer loan originations double between between 2021-22. FORUM also receives around 97% positive ratings in user satisfaction polls—significantly higher than its competitors.

In addition, Temenos is helping FORUM to address constantly evolving financial regulations. The credit union configured the Temenos system to collect relevant data points, which it uses to create reports that demonstrate compliance with industry guidelines.

More to come…

Next up is an implementation of Digital Onboarding (previously Journey Manager) to support a redesign of their digital experience and an upgrade to their fraud management capabilities. “Over the last 10 years, there’s been continued evolution and enhancement, with new features and functions that we continue to build out. We have a lot of plans for the future and Temenos will definitely be coming along for the ride.”

Today, the mood at FORUM is one of confidence

At a Glance

● Offers exceptional levels of security to account holders

● Provides up-to-date digital banking capabilities

● Increases cost-efficiency; employees spend less time and resources managing IT infrastructure in the data center

● Scale its digital banking infrastructure quickly and easily in line with rising member volumes

 

Baxter Credit Union (BCU) strives to find innovative ways to improve the financial well-being of 320,630 members across the United States and Puerto Rico. This could mean introducing personalized services that help members manage their finances more proactively, providing faster access to key lending products, or offering a more intuitive online experience. All in all, BCU places a premium on continuous improvement.

Jim Block, Executive Vice President & Chief Operating Officer at Baxter Credit Union explains: “Across our business lines, we are always planning ahead and thinking not only about how we can meet evolving member requirements but also how we can get a step ahead of the curve. To achieve this, we naturally forge close links with our network of technology partners to ensure we have access to the most advanced digital capabilities.”

In 2016, Baxter Credit Union (BCU) faced the need to upgrade from version 10.31.20 to version 15.01.47 of Temenos digital banking, spanning the Collection, Loan Origination, and Service modules. The project alone was already considered a major upgrade, as it encompassed launching the $2.8 billion credit union on Temenos’ most recent “person-centric” technology, a panoramic view of account holder relationships. BCU took it one step further and asked to do what had never been done: take the Temenos collection, loan origination, and service to the Cloud.

We are planning double-digit growth across key areas, which means we need to have the ability to scale our technology to meet growing demands. This scalability takes out the uncertainty in our planning, and ensures that our investments are targeted and consistent. When looking at a major upgrade with Temenos digital banking, we knew that as part of that project we wanted to move hosting into Microsoft Azure.”

Scott Zulpo, CTO at Baxter Credit Union

Situation

BCU’s decision to move to the cloud crests the wave of financial institutions that have begun to examine moving to hosted environments. Historically, the cloud has been viewed with apprehension and distrust by the financial services industry. In the United States specifically, following the wave of security breaches across retail store chains, hospitality organizations, and even the United States government itself, concerns surrounding cybersecurity are at an all-time high, reflected in heavy government regulation. The first task for BCU, Microsoft, and Temenos was to ensure security.

“Temenos handles a large amount of account holder data. Combined with the fact that this was the first time these modules were being implemented in the cloud, we knew we needed to undergo rigorous testing to ensure that not only was everything functioning properly in an all-new environment, but also that it was secure.” – Temenos Executive explains.

US-based BCU wanted to decrease costs while increasing scalability and speed-to-market. In 2017, they became the first Temenos customer to take the Temenos Collection, Loan Origination, and Service into the Cloud

While some organizations might view being an “inaugural customer” as a risk, BCU instead saw the chance to pull ahead of its contemporaries. Additionally, they saw the benefit of moving away from maintaining data centers and reducing IT overhead, which would allow them to focus less on managing systems and concentrate on offering first-class products and services.

“Over the past three years, we’ve made it a strategic objective to move into the cloud wherever the opportunity arises. Our long-term goal is to move all of our vendors into a cloud-based environment. Our vision is to centralize all of our technology so that we can implement uniform processes and skillsets across departments. We are continually investing in technology and innovating in that space. This transition will allow us to increase automation and spin up additional servers more quickly, enabling us to scale and paving the way for growth.” Jeff Johnson – CIO at BCU

Solution

The decision to move to Microsoft Azure led to extensive testing and a thorough audit of their existing processes, making BCU more secure than ever before. Using recent software delivery methodology, the testing and implementation were completed over nine months and included a multitude of checks and balances with continuous collaboration across the implementation teams. During phase one, Temenos and BCU built five environments in the cloud over roughly two months. Phase two was spent upgrading the Temenos digital banking modules to Version 15, fine-tuning processes, and testing that the functionality had not been impacted by the all-new environment. This phase involved a two-pronged approach:

1. Business Unit: Functional testing of the Collection, Service, and Loan Origination modules as BCU jumped four releases
2. IT: environment configuration testing, including firewalls and connectors.

Due to the implementation being the first of its kind, the project involved levels and aspects of security that had not been encountered in previous projects. This meant additional, in-depth testing outside standard parameters from a security perspective, as well as ensuring that the new protocols didn’t inhibit functionality within the system. BCU officially went live in March 2017, with no unplanned interruption to service. With the Temenos digital banking modules now hosted in Microsoft Azure, BCU has gained multiple layers of data protection, including data encryption, auditing, and Azure’s unique threat detection offering. Since the implementation, BCU has seen an improved ability to scale on demand, enhanced disaster recovery capabilities, and optimally sized hardware for their volume.

Any financial institution looking to take on a project of this magnitude needs to understand just that: it’s a project of immense size and difficulty. It’s a significant commitment, and the decision should certainly not be taken lightly. However, the project has undoubtedly moved us much farther ahead in our understanding of each of the technology platforms we use to drive our business lines, and also the levels of security we can offer to our account holders.”

Jeff Johnson, CIO at Baxter Credit Union

With the Temenos digital banking upgrade completed successfully, BCU has access to the latest digital banking capabilities, including open APIs, automation, and sophisticated decisioning tools. The credit union can now ingest and analyze more data about lending requests, helping to build a detailed, three-dimensional picture of applicants. As a result, BCU makes lending decisions faster, ensuring members enjoy a stronger experience.

With Temenos, we are making banking better for our members, giving them the tools and services they need to improve their financial wellness. Having a strong network of partners on hand is essential to drive change, and Temenos plays an important role in our success. We will continue to explore new roadmaps and digital strategies that help us to grow and take our offerings to the next level.”

Jim Block, Executive Vice President & Chief Operating Officer at Baxter Credit Union

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