Continuing a Member-Owned Philosophy
By Chattanooga Magazine Staff

Tennessee Valley Federal Credit Union is the largest credit union in the region, and its employees insist that's because they work hard on customer service, equality, and there is a commitment to its members. "We always look at it from 'What's in it for our members?'" says W. Blake Strickland, president and CEO of TVFCU. "Because if it weren't for the members, we wouldn't be here."

Like all credit unions, TVFCU is owned by those members, unlike a bank, which is owned by stockholders. It's a model that originated in the mid-nineteenth century with a focus on serving its members rather than maximizing profits. In 1936, after President Roosevelt signed the Federal Credit Union Act, a group of about 200 Tennessee Valley Authority members decided to form a financial cooperative founded on the principle of "people helping people." They pooled about $500 in resources, and all deposits and withdrawals were overseen by elected volunteers. It was a small operation at first, run out of a lockbox kept in a bottom desk drawer.

"They'd have a new employee at TVA come in, and they needed to borrow money to move the family down here or whatever," Strickland says. "The credit union didn't have enough money right then, so they would call around to the members and say 'Listen, we need for you to deposit ten bucks. We need to make a loan to somebody.' Literally."

As TVA grew, the credit union grew, and every decision was made by volunteer board members on behalf of the members. The small credit union formed its first official office in the Pound Building in 1938, then the James Building later that year. Over the years, it was located in the old Post Office building, the Edney Building, the lobby of the Patten Hotel, a building on Chestnut Street, and finally to its current headquarters at 715 Market Street.

In the 1980s, TVFCU started allowing various select employee groups, or SEGs, into the credit union over time; here an accounting firm, there small business, and so on, until there were nearly 2,000 SEGs whose employees, and their families, could use the TVFCU. But even with so many potential members across the Chattanooga area, there were still people asking daily whether they could join the credit union.

"Even when we had these 2,000 SEG groups, there were still people who weren't associated with them in some way," Strickland says. "We had people coming in every day who would say 'Can we join?' and we would try to figure out a way for them to join, but there wasn't a way, so we had to turn them away. And they were folks who needed financial services."
Six years ago, TVFCU received a community charter to open its doors to anyone who lives, works, worships, volunteers, or attends school in any of the 13 counties in southeast Tennessee and northwest Georgia that make up the Southeast Tennessee Economic Development District.

With more than 88,000 members, over $678 million in assets, and over 70 years of experience under its belt, TVFCU is looking for new ways to make its members happier and more satisfied. The TVFCU currently has 13 branches and is planning to open two new branches in the months to come, one on Highway 58 and another in Ringgold, as well as to start offering commercial lending. Employees are trained in the highest-quality customer service, and the environment is friendly, professional and relaxed. The TVFCU offers most of the financial services typical of a bank-checking and savings accounts, credit cards, loans, online banking-but often with lower rates and fees, as a result of the company's motivation to serve its members above all else.

This member-centric philosophy affects the company's decisions, from new services offered and fees charged to the layout of its branches. That layout is unusual in the world of banking, but it's made a big difference for TVFCU employees and members. Instead of a traditional teller line behind a high, wide counter, members walk into bright, expansive lobbies with a comfortable lounging area for coffee and hot drinks, and a series of unobtrusive pods, or little banking kiosks. Upon entering one of the 13 branches, members are greeted by an employee and led to one of these pods, where they can see their transaction and account on a computer screen, talk and ask questions, and make deposits or withdrawals from a secure money bank rather than a cash drawer. The money bank is also faster than a cash drawer, and saves an estimated two minutes per customer, which adds up during the day and cuts down on longer lines and wait times.

"It's very open," Strickland says. "A lot friendlier, and that's what we do best. We know our members and our members know us, and we work with our members one on one. It just gives us a lot more opportunity to interact."

Credit unions and even banks from across the country have come to tour TVFCU's branches and get ideas for this new kind of customer-service oriented banking. The credit union started this new arrangement when it was looking for new ways to reach out to members. After going to conventions and visiting other cutting-edge financial institutions, Strickland had customer service on his mind while on a trip to Kentucky. When he entered the hotel to check in, an employee immediately greeted him and let him over to a kiosk to check in on a computer. Strickland was struck by the open and friendly approach and thought it would work well for the credit union.

The TVFCU was already in the process of remodeling its headquarters' dark '70s era lobby, and when Strickland brought back the idea, they switched gears midstream and started planning for a new look, which the rest of their new branches emulated. The credit union is also planning to remodel some of its older branches that still use the standard teller lines.
Customers love the relaxed atmosphere and equality with the tellers, who make a point to get to know the members. A series of television commercials for the credit union asked members how they felt about their credit union, and the result was spectacular. Member after member said they were impressed by the customer service and friendly employees, and they love the credit union. The monthly surveys sent out to members often come back with comments in the same vein: members love the credit union.

"Some of our members love us so much they stop by just to have a cup of coffee and say hi," says Jimmy Johnston, marketing coordinator. "That is a real statement into the kind of service we provide."

Strickland makes it clear that there is nothing wrong with the way banks operate; it's just a different method of business and different priorities. But it's also clear that he believes in his credit union. He says it offers an attitude that can't be found elsewhere.

"You can go anywhere and get financial services," Strickland says. "But our thing boils down to service. There's a whole different way that we look at taking care of our members. The person who walks in the door owns the place, so let's treat them that way."