Credit Union Brings Virtual Reality to New Branch

United Federal Credit Union (UFCU), previously serving customers from three branches in the River Valley, expanded its Arkansas footprint March 16 when it opened a branch in Springdale, inside the Walmart Supercenter at the Elm Springs Road exit.

It’s a fully staffed branch (Tori Weathers is the manager overseeing five employees), with the usual complement of services available, including loans, mortgages, checking accounts, debit and credit cards, investment planning and business lending.

But a closer inspection will reveal a new machine that is beginning to pop up in credit unions across the country, and the technology has been described as being somewhere between Skype, Google Hangouts, Max Headroom and a Star Trek holodeck.

It’s called telepresence video communication, which utilizes 3D technology and real-time video to enable customers to engage in virtual meetings.

The kiosk is in a secure room and allows up to two customers to be seated at one time, giving members in the branch the opportunity to talk immediately with a UFCU financial expert at the company’s home office in St. Joseph, Michigan.

Noel Sanger, UFCU’s market vice president for Arkansas, said the credit union is the first financial institution in the state to use the high-definition 3D Omni-Suite technology, which projects to the customer a life-size image of a credit union staff member in 3D on a 55-inch LED screen, complete with eye contact and theater-quality sound.

“It’s not like video conferencing,” Sanger explained. “Instead of feeling like you are talking to a television, you are talking to a true person. You can sense the person is right there.”

Therasa Poschke has been a mortgage loan officer with UFCU for 15 years. She said speaking with off-site customers and answering their questions using the 3D Omni-Suite is as close as possible to having a face-to-face conversation.

“We still do what we do every day,” she said. “It’s just like speaking to customers in front of us.”

Sanger said the Springdale branch is the second UFCU location in the United States to use the Omni-Suite technology. The first was installed, also in March, at a location in Reno, Nevada.

For the credit union, it’s a cost-effective way to leverage staff by making financial experts available on demand.

It’s also another way, Sanger said, UFCU can enhance member relations in a competitive market — which underscores why the credit union opened its first branch in a Walmart.

“We have a variety of ways members can interact with us whether face to face in a branch, online, on the phone or a mixture of those options and [being] innovative,” he said. “Using technology will help us be even more responsive to the needs of our members.”

 

Wow Factor

The expectations of what customers want in a financial services branch are changing.

Customers are increasingly doing their banking in online mode, and branch traffic, some analysts feel, is declining as a consequence.

That’s where the Omni-Suite developers are trying to fill the gap, marketing their product as a solution to providing connectivity within the branch environment.

Omni-Suite is part of the Omni-Series portfolio of machines, made by TelePresence Technologies LLC of Plano, Texas, and sold by Buffalo Pacific LLC of of Naples, Florida, a credit union service organization.

The two organizations are sister companies, and David Allen is the chairman of both. He was a pioneer in developing the telepresence industry two decades ago.

According to Buffalo Pacific, there are three things that make Omni-Series machines, which range in price from $24,000 to $60,000, different from other video-conferencing tools — they project a life-size image of conference participants in 3D, and they provide direct eye contact.

“It’s not just a vehicle for communication,” said Bruce Clapp, Buffalo Pacific’s chief marketing officer. “We hear the word ‘wow’ a lot after giving a demonstration. People have a preconceived idea about what video conferencing is because they have used Skype or GoToMeeting, but our experience is just that. It’s an experience.”

Clapp said the 3D Omni-Series technology uses about 10 different patents developed over the last decade. It has been fine-tuned and the right audience has been found — the financial services industry.

MidUSA Credit Union in Middletown, Ohio, was the first credit union to install the technology in 2013. Today, an Omni-Series machine can be found in about 30 locations across the country, and the Omni-Suite has been clearly defined as the most popular.

Clapp said credit unions have been the first to jump on board because most of the principal investors in Buffalo Pacific have a background with credit unions.

“It was a natural first step to go with what you know,” he said.

Banks, however, seem to be a logical next step for the service. The Federal Deposit Insurance Corp. reports there are about 6,400 banks operating in the United States, and Buffalo Pacific is poised to crack that market.

Clapp said company representatives attended the annual BAI Retail Delivery — one of the premier retail banking conferences in the world — in November. Since then, he said several banks have contacted the company with an interest, and two installations are pending at community banks in Texas and Ohio.

 

Credit Growth

UFCU, as it exists today, was formed in 2006 by the merger of credit unions originally started by employees of the Whirlpool Corp., headquartered in St. Joseph, Michigan, and Clark Equipment Co., formerly of Buchanan, Michigan.

The Whirlpool Fort Smith Division Federal Credit Union was founded in 1967. The first Arkansas branch, according to UFCU spokeswoman Marta Elliott, was a trailer in the parking lot of the former Whirlpool factory in Fort Smith.

Today, UFCU has freestanding offices on Jenny Lind Road and Rogers Avenue in Fort Smith and another on Fayetteville Road in Van Buren.

In addition to the Walmart branch in Springdale, UFCU is also opening a branch in Alma on April 20 in a former bank office.

 “We’re the largest credit union in Northwest Arkansas,” Sanger said.

The market consists of about 21,500 members and accounts for roughly $225 million of UFCU’s $1.8 billion in assets.

Those numbers reflect growth of 11.4 percent in membership and 26 percent in assets in 2014, Sanger said.

Growth is the trend among credit unions nationally, too. Membership grew 3.6 percent last year, the most in 20 years, to more than 100 million members, according to Credit Union National Association estimates.

The reason for the growing popularity, Sanger believes, is because there are more attractive financial incentives for consumers. Credit unions are nonprofit institutions, and because they don’t have to make a profit for shareholders, unlike banks, they return their gains to members in the form of fewer and lower fees, lower loan rates (auto, home, equity lines of credit) and higher yields on savings.

They also face fewer regulations, which is a constant constraint on community banks.

Without discussing many specifics, Sanger added that UFCU, which has more than 132,000 members in all 50 states and the District of Columbia, could be embarking on a growth phase in the local market.

UFCU currently has branch offices in Michigan, Ohio, Nevada, North Carolina, Arkansas and Indiana.

“We would love to see growth in Northwest Arkansas, and I can envision branches all across Northwest Arkansas,” Sanger said. “We have already grown tremendously in Arkansas.”