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The Bottom Line

For all the banking executives that oversee vendor relationships, see if this scenario seems familiar: A long-time vendor visits your institution and, out of the blue, offers a contract extension along with attractive incentives; e.g., signing bonuses, rebates, pricing discounts, etc. To date, you’ve enjoyed a solid relationship with this partner with no plans to break the contract at expiration, so this provides an opportunity to look like a hero to your institution, bringing in an unexpected windfall to fund other priorities. What could be the downside? 

Budgeting and planning season is a time for evaluating priorities and costs. It should also be a time for reviewing vendor contracts.

Too often banks and credit unions make the mistake of plugging vendor costs into their budgets and forecasts without questioning whether those figures can change. The truth is that a savvy institution can find opportunities to reduce vendor costs without switching vendors or impacting service levels by simply asking the right questions.

According to the Federal Deposit Insurance Corporation, approximately 27 percent of all American households are unbanked or underbanked – that’s 50 million individuals.

For purposes of this article, unbanked refers to individuals who don’t have a bank account and underbanked refers to those who supplement their bank account with alternative financial services like check cashers. Both underbanked and unbanked households are typically forced to rely on nonbank financial or high-rate lending solutions such as payday lending, tax refund, and settlement loans. They are out of the mix for traditional banks, which means little to no opportunities for payments and fees from them.

According to the Federal Deposit Insurance Corporation, approximately 27 percent of all American households are unbanked or underbanked – that’s 50 million individuals.

For purposes of this article, unbanked refers to individuals who don’t have a bank account and underbanked refers to those who supplement their bank account with alternative financial services like check cashers. Both underbanked and unbanked households are typically forced to rely on nonbank financial or high-rate lending solutions such as payday lending, tax refund, and settlement loans.

In today’s economic climate, mergers and consolidations of financial institutions are fairly common.  Anyone who has been involved in one knows it is a time of opportunity and critical decisions. So many considerations go into such transactions, most of which legal teams oversee. There are benefits of working with companies offering proprietary benchmarks and experience that goes well beyond the scope of work offered by traditional advisors – bringing an innovative and proven approach that mitigates expenses and maximizes revenue.

According to new National Credit Union Administration rules, before 2019, many credit unions will need to significantly increase their capital to adequate levels.

Financial institutions are full of smart professionals—straight shooters who know how to judge character and structure a deal. But even the wisest among them overlook savings opportunities when dealing with third-party vendors.

Pressed for time and facing salespeople determined to sell their services at a premium, these otherwise successful professionals can find themselves at a disadvantage and end up paying for it.

JANUARY 5, 2016: When it comes to third party management, cyber security and data protection get top billing. Yet there is another expectation that financial institutions know is just as important to keeping their institutions strong and safe: Vendor pricing and contract management.

MEMPHIS, Tenn., December 2, 2015 – Videos are becoming a critical part of the online identities for many companies. For financial institutions (FIs), the questions of the day are both “could” or “should” they make use of online videos.

MEMPHIS, Tenn., November 19, 2015 – NAFCU Services Corporation has selected Strategic Resource Management (SRM), a proven leader in the bottom line enhancement industry, as the preferred partner for vendor cost benchmarking and contract negotiation services.  SRM joins a distinguished group of 30 NAFCU preferred partners carefully selected by leaders in the credit union industry.