County Credit Union Makes the Move to Home-Based Banking

At their annual strategy meeting last September, officials of the Ventura County Federal Credit Union decided that if their institution were to keep up with client demands, it had to move rapidly toward high-tech, home-based banking.

Earlier this month, the credit union unveiled the first product of that decision, an Internet Web site that will allow its members to handle a host of financial transactions from their home computers.

“It was determined that the future is going electronic and if we don’t position ourselves to meet those needs, we aren’t doing well by our members,” said Carol Leichtfuss, president and chief executive of Ventura County Federal Credit Union.

“Our members can access their account history, do online balances, transfer money, make loan changes, check stock options.”

By the end of the year, the Ventura-based credit union expects its customers to be able to pay bills over the Internet as well. The 28,000-member institution, which mostly serves city and county government employees, is the first Ventura County credit union to establish such an extensive, computer-based home banking system.

“When we looked at the percentage of our members who are PC literate, it became obvious there was a need,” Leichtfuss said. “This is very new to credit unions. Some have PC disk-driven home-banking systems, but only a handful are on the Internet.”

In addition to online access, the institution plans to establish 24-hour, full-service banking kiosks throughout the county during the next five years to accommodate its widespread clientele. Officials also intend to set up kiosks inside businesses that include membership in the credit union as an employee benefit.

Although Ventura County Federal is the first credit union in the county to institute full-service home banking, others are close behind.

Linda Teshima, director of marketing and personnel for the Ventura-based County Schools Federal Credit Union, said officials there are looking at instituting a home-banking system sometime next year.

“Home banking is new and exciting and members want to try it to see if it’s for them,” Teshima said. “It’s something we’re at the cusp of right now.”

Currently the credit union has an 800 number through which members can check on the status of their accounts, transfer money and handle other transactions any time of day.

The credit union has about 7,500 members, including Ventura County teachers, school administrators and personnel and their families. Teshima said the main concern about home-based computer banking is the privacy of these members’ personal information.

“I believe a concern of a lot of financial institutions is keeping this information confidential,” she said. “We want to make sure when a program is up and running that it is 100% safeguarded.”

Although the county schools credit union has been looking into home banking for a while, Teshima said, member interest has escalated considerably over the past couple of years.

“It seems these days people have less and less spare time and they don’t want to spend it standing in line,” she said. “People see Wells Fargo and other big financial institutions on the Internet and everyone is trying to keep up with the Joneses. I think this has pushed up the time schedules.”

Dick Cooper, director of marketing for the Point Mugu Credit Union, said the lower costs and higher speeds of computers have also accelerated interest in home banking.

“It’s more and more common for a household to have a PC in it,” Cooper said. “You bring home the computer and then it’s, ‘What am I going to do with it? I can write a letter to Aunt Bertha, the kids play games on it. Oh, I can do my banking too.’ ”

The 32,000-member credit union serves military personnel and civilians at the Point Mugu Navy base, as well as a small number of outside employee groups throughout the county.

As with the county schools credit union, the Point Mugu Credit Union has an automated 800 number. But within a few weeks, Cooper said, the institution is scheduled to launch a personal computer-based home-banking pilot program.

Under this system, members will install a disk into their personal computers that will allow them to handle a number of financial transactions, including the automatic payment of bills.

The banking software is manufactured by CFI Inc. of Portland, Ore. Cooper said that about 100 credit unions nationwide subscribe to the system.

“For financial institutions to invest considerable capital in home banking, you used to have to be a Citibank to afford to be able to do it,” he said. “Now, because of these [software] packages, it’s still an investment, but nowhere near what it was four or five years ago.”