Lone Star Credit Union Takes to the Cloud and Blockchain for Secure and Streamlined Banking Solutions

Sit down with Becky Reed and you immediately know she’s a firecracker. She’s up for anything technology that makes sense. She loves to play in the sandbox of innovation – and for Lone Star Credit Union’s team to play along.

It’s not often still that CEOs come up through the technology side of credit unions, although that’s likely to become the trend as banking moves ever faster into the tech space – and vice versa. That’s why it’s important to be constantly challenging our credit unions and trying different paths along the digital transformation journey.

“Failure is not a bad word. Fail fast and pivot.”

That’s not to say it’s not without risks, and those must be kept in mind, Reed says, especially given many fintechs’ mentality doesn’t immediately go to things like lending compliance and security. For credit unions, that’s second nature.

Certainly, there are the direct benefits of the copious technologies offered, but Reed adds that it also gives employees the chance to try something different and build their leadership skills. In some small credit unions with few employees, these opportunities aren’t always readily available.

Distributed Ledger Technology vs. Crypto vs. Cryptocurrency vs. Blockchain

Reed is no stranger to taking risk herself, as she’s co-founded Rivia, a stable coin built around – well – stability to enhance its use in banking and transactions as opposed to cryptocurrencies that aren’t backed by existing currency. In the video below, she explains the differences between the terms, which are frequently conflated, causing confusion and fear, particularly following the crash of FTX that has dampened any people’s enthusiasm for cryptocurrencies.

That said, the term crypto, Reed explains, simply refers to cryptography, or the code or algorithm that encrypts the blockchain. That crypto ecosystem can also be referred to as Distributed Ledger Technology to avoid confusion. A type of DLT is the blockchain; blockchain is the rails that cryptocurrencies run on. Bitcoin and Ethereum are two of the most popular cryptocurrencies.

Wow, I need to take a break now. Listen to Becky’s explanation in the video around 10:25 for more. (Complete show notes below.)

Reed’s Head Is in the Clouds, Too

After leveraging Pure IT to take her credit union entirely virtual, Lone Star has championed the CUSO as a way for smaller credit unions to harness the scale and power of technology they can’t possibly do on their own. She currently serves as co-founder and chairman of the board at the CUSO, which offers cloud services to credit unions, including its recently announced partnership with Envisant to offer the Cloud + Union ‘credit-union-in-a-box’ solution as she referred to it.  

“I believe collaboration is our industry superpower. I believe CUSOs are our superheroes.”

And if that wasn’t enough, Reed now serves as the chair of NACUSO, which she credits, along with retiring CEO Jack Antonini, with providing her the opportunities to explore many of the technologies her credit union and others are taking advantage of.

We also talked about the under-appreciation of CUSOs. Credit unions can invest in CUSOs, impact development of technologies, scale and provide services they never could on their own. Plus, it can be a great source of noninterest income in the long term.

Anyway, I don’t want to give it all away. You have to watch the video to really feel Reed’s passion for credit unions, CUSOs and technology, and get inspired by all that can be done when credit unions of all sizes decide we will “fail fast and pivot” together. Really, what’s the alternative?

SHOW NOTES

0:00 Becky brings us up to speed on her career in credit unions, technology and what Lone Star is up to

1:44 Women in tech – yes, they do exist

4:22 Making fintech technology accessible for all credit unions

6:16 Don’t mind Lone Star CU employees – they’re just playing in the sandbox

6:53 Risk and reward of working with fintechs

9:06 Employee engagement through #innovation

10:25 Distributed Ledger Technology vs. Crypto vs. Cryptocurrency vs. Blockchain

13:19 Blockchain is dead; long live blockchain

20:21 Transparency & tech adoption

23:12 Credit union heroes

25:50 Noninterest income

26:36 What’s next

29:16 Parting words of wisdom