Turning Credit Union Performance Trends Into Growth Opportunities: A Prescreen Marketing Perspective

By Devon Kinkead

The latest first quarter 2025 credit union performance data from Callahan & Associates reveals a fascinating paradox: members are saving more than ever, yet lending growth is slowing dramatically. For credit unions wondering how to navigate this landscape, the answer lies not in waiting for market conditions to improve, but in embracing precision-targeted prescreen marketing technology that turns these trends into competitive advantages.

The Member Behavior Shift: What the Data Reveals

Credit union members are sending clear signals about their financial priorities. Shares grew by an impressive 4.6% annually in Q1 2025, marking the highest growth rate in more than two years and the second consecutive quarter where credit union share growth outpaced the national personal savings rate of 4.0%. Even more striking, the $64.7 billion increase in shares exceeded 2024’s first quarter by nearly $11 billion.

This isn’t just about certificates anymore. Every share product increased, with regular shares growing more than $20 billion and share drafts close behind. Members are building accessible emergency funds and preparing for uncertainty, demonstrating exactly the kind of prudent financial behavior credit unions exist to support.

However, the lending side tells a different story. Total loan growth slowed to 3.4% annually, down from 4.6% a year ago. The median loan growth dropped to just 0.34%, indicating that larger credit unions are driving most industry lending while smaller institutions struggle. Year-over-year declines appeared across credit cards, auto loans, and other residential real estate lending.

The Widening Performance Gap Demands Action

Perhaps the most concerning trend in the data is the expanding gap between mean and median performance. While industry averages suggest moderate health, the median credit union’s 0.34% loan growth reveals that half of all institutions are experiencing near-stagnant lending portfolios. This divergence signals that traditional approaches are no longer sufficient, and institutions that fail to adapt will find themselves increasingly marginalized.

This is where automated prescreen marketing becomes not just advantageous, but essential. The credit unions capturing market share now will define the competitive landscape for years to come, and those relying on manual processes and broad-based marketing simply cannot compete with the speed and precision of AI-powered targeting.

The Refinancing Opportunity Hiding in Plain Sight

While overall lending has slowed, members aren’t borrowing less because they don’t need credit. They’re being more selective about when and how they borrow. This creates a perfect environment for targeted refinancing campaigns that help members save money while providing credit unions with profitable loan growth.

Consider the opportunities embedded in the current market:

Credit Card Debt Consolidation: With delinquency improving slightly in Q1, members are demonstrating better financial habits. This is the ideal time to proactively identify members paying excessive interest rates on credit cards or other high-cost debt and offer them meaningful savings through personal loans or home equity products.

Auto Loan Refinancing: The slowdown in auto lending doesn’t mean existing auto loans have disappeared. Automated prescreen technology can identify members whose credit scores have improved since origination or who are paying above-market rates, offering them immediate monthly savings.

Strategic Product Positioning: Members moving money into liquid, lower-dividend products signals they value accessibility. This presents opportunities for flexible credit products like HELOCs that provide the security of available funds without the commitment of term loans.

From Reactive to Proactive: The Automated Prescreen Advantage

Traditional prescreen marketing has been complex, labor-intensive, and primarily accessible only to large banks and fintechs. This complexity involves coordinating multiple vendors, managing compliance requirements, and manually analyzing results across disconnected systems. The 21-day average approval time and 36-day closing timeline that characterize traditional approaches simply cannot compete in today’s environment.

Automated prescreen technology fundamentally changes this equation by leveraging AI, machine learning, and access to comprehensive credit data across more than 230 million consumer records. Instead of generic “great rates available” messaging, members receive hyper-personalized offers that show exactly what they could save. For example: “You’re currently paying $280 per month too much in interest. Refinance your $40,639 debt from 19.890% to 8.642% and keep that money in your pocket.”

This level of personalization drives higher conversion rates while maintaining full FCRA compliance. Credit unions implementing automated prescreen typically see material conversion rate improvements, with many achieving net negative acquisition costs where the income from new loans actually exceeds campaign expenses.

Aligning Technology with Credit Union Mission

The beauty of automated prescreen marketing is how perfectly it aligns with the fundamental mission of credit unions. Rather than simply driving growth metrics, this technology enables institutions to:

Improve Member Financial Health: By continuously monitoring member portfolios and proactively offering better rates, credit unions can automatically identify and help members who are overpaying for credit.

Build Deeper Relationships: Demonstrating ongoing care for member financial wellbeing through timely, relevant offers reinforces trust and creates the foundation for primary financial relationships.

Strengthen Communities: When members save money through refinancing, that increased disposable income flows back into local economies, multiplying the positive impact of every loan.

Extend Financial Inclusion: Data-driven insights help identify underserved populations who would benefit most from better credit options, expanding the reach of the credit union mission.

The Margin Reality Creates Urgency

The good news from Q1 2025 is that net interest margins hit 3.23%, the highest level since 2010, outpacing the operating expense ratio of 3.06%. This provides credit unions with the financial flexibility to invest in growth initiatives. However, this margin advantage won’t last indefinitely, and the institutions that leverage it now to build automated marketing capabilities will be positioned to capture market share as competitive dynamics shift.

The data is unambiguous: member savings are growing faster than lending, the performance gap between institutions is widening, and members are making deliberate choices about their financial futures. Credit unions that continue relying on manual processes will watch larger institutions and fintechs capture the refinancing opportunity while their portfolios stagnate.

Taking Action: The Path Forward

The convergence of strong member savings behavior, improving delinquency trends, and widening performance gaps creates a once-in-a-generation opportunity for credit unions ready to act decisively. Automated prescreen marketing provides the speed, precision, and scalability to transform these industry trends into institutional advantages.

The technology exists. The market opportunity is proven. The question facing every credit union leader is whether their institution will be among those capturing market share through intelligent, member-focused automation, or settling for whatever’s left after competitors act first.

For credit unions seeking to bridge the growing performance divide, the time to embrace automated prescreen marketing isn’t tomorrow. It’s today.

Start your growth journey today here.