April 20, 2021
Podcast Recap: What attracts young borrowers to education lending services?
When it comes to education lending, banks and credit unions have tried to attract Gen Z and Millennials and retain them for their whole life cycle of lending options. Amanda Bardonner, director of Account Management at Lendkey and Tom Kane, the Assistant Vice President of Marketing Communications at Franklin Mint Federal Credit Union recently spoke on NAFCU’s The CU Lab Podcast on Attracting Younger Borrowers with Education Lending including successful marketing campaigns, why they were effective, the member feedback they received, and more.
[1:29] How do student loans fit into the consumer life cycle? They play an important role. For many, their first experience when applying for credit is obtained by applying to the student loan. Later on in their lifecycle, consumers are looking to purchase their first home and those student loan debts can often be the deciding factor between somebody getting that pre-approval they are looking for.
[02:29] 66% of Gen Z are saying that they are worried about accumulating or not being able to pay off their student loan debt. More than 80% of respondents in that survey said they are going to obatin at least a two-year degree.
[03:21] 67% of student loan borrowers took out at least one additional product with the credit union who they finance their student loan through. It is a great opportunity to not only attract but to continue to retain and grow those relationships.
[12:28] Members need more than one product during their membership. Mirror your products together and do some joint campaigns that speak to what your target member is going through at that time of their life.
On the NAFCU podcast, Tom Kane shared that they learned you need to truly listen to what your member’s need to help build the most successful marketing strategies to attract Gen Z and Millennial audiences. Franklin Mint Federal Credit Union had a lot of the resources available to them from LendKey since they launched their education lending program in 2018, but it was crafting targeted marketing and adapting new digital strategies that helped bring their education lending to the forefront.
You don’t want your products and services to be your best kept secret. Train member-facing staff about your products from personal loans and auto loans to home improvement loans and student loans so you can reach consumers at every moment of their life cycle.
Attracting young borrowers to your bank and credit union with education lending is about quality care and understanding their needs while they build their credit, take out a private student loan to finance their education and later and refinance their existing debt when needed.
Show notes and research:
Franklin Mint Federal Credit Union Case Study shares insights into student lending and the specific nitty-gritty what FMFCU did to attract young borrows and serve current members and their families.
Life Time Value of a Student Loan Relationship Cornerstone Advisor studied student loan refinancing and how banks and credit unions can tap into this market and build relationships with consumers in their prime borrowing and earning years.