Exploring member business lending (MBLs) during 2016 was one recurring priority I heard during this year’s planning season. As management discussed that proposition, without fail, angst would follow as the credit unions considered such a significant initiative. Credit unions realize that commercial lending differs significantly from consumer lending, with some lessons still fresh from experiences during the Great Recession.
Despite those experiences, a reasonable exposure to MBLs can serve members’ needs while providing positive yield. So, why should a credit union offer business lending, what considerations must it take, and how should it go about it? It can do so by answering three simple questions.