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A Former NCUA Chairman’s Perspective on Innovation · Leaders in Lending

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You're listening to Leaders and Lending from Upstart, a podcast dedicated to helping consumer
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lenders grow their programs and improve their product offerings. Each week, here,
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decision makers in the finance industry offer insights into the future of the lending industry,
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best practices around digital transformation, and more. Let's get into the show.
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Welcome to Leaders and Lending. I'm your host, Jeff Keltner. This
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week's episode features my conversation with Rodney Hood and a former chairman and current war
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member of the NCUA. So we got a credit credit union regulator on the
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podcast. We don't get a lot of actual regulators. I really enjoyed this
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conversation with Rodney. We went through why that opened up an office of innovation
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and access and why you think of those two things is importantly combined and put
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them together and the office. I thought that was a really fascinating We also
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talked about his Shark Tank program and a regulator, so that's not something I
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thought would go together. So fascinating conversation about how he thinks about innovation,
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how innovation can be helpful to consumers, the role of FinTechs, the role
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of AI in helping broaden both innovation in the space to help the consumers,
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but also broaden access and help with financial literacy. Think all really important topics.
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Rodney was a fascinating guy and I'm really glad we got to have this
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conversation. So please enjoy my conversation with Rodney Hood. Rodney, thanks so
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much for taking the time and join us on the podcast today. I really
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appreciate it. I'm allowed to be with you, Jeff, and thanks for
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the kind invitation. Yeah, it's not often I'm going to talk to people
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who actually work in the regulatory environment on the podcast, so I'm really fascinated
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to do this. Well, I am too. In any chance to get
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an opportunity to demystify the regulatory process, I'm all for. Well, I
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want to. I love demystify, but I want to. When we first
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talked, do you use the phrase shark tank? And I got to start
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with that because of all the phrases I thought I would hear coming from somebody
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working in a federal agency, we have a shark tank, it was not
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one. So talk to me a little bit about what you're doing in that
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vein. We'll dive off from there. But that phrase you're stuck in my
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mind. From our kind, I wrote it down like start with this because
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it's one in interesting. But Jeff, it is from to start with that
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shark tank is something. And I'm doing the air quotes because I realized that
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shart tank has been trademark so I have to do shart tank life isn't the
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UK was the Dragon's den right exactly, exactly exactly. But Jeff, I
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think what you're hearing from me, and anytime we speak it's fintech is integral
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to the ongoing success of the credit union system. I recognize that we as
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government regulators, no one ever expects us to lead when it comes to innovation.
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They often expect us to follow, so we can be really quick followers
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and maybe even early adapters. But when it comes to really getting that game
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changing product out there that really is going to help our communities grow, thrive
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and prosper, it is through those social entrepreneurs who are typically working in a
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shart tank or a competitive environment. So I, as many people know,
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have wanted to really look at ways to broaden financial inclusion throughout our society.
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I often say, Jeff, that financial inclusion, you know, it's the
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civil rights issue of our generation, and we're not hearing a lot of tools
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and products come every day that's going to help that forty percent of American households
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who's frankly can obtain fourugred dollars in an emergency. So one of the things
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that I worked on there's a lot of venture capital funding that's now going into
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fintech that are serving credit unions. There's almost about nine hundred million dollars that
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I'm aware of that supporting credit unions and fintech. So I banded this idea
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around with them, why don't you all put together a competition where social entrepreneurs
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FinTechs that are focusing on financial inclusion can get together and do a sharp tank
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light event where we get people together, we judge, we give them our
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opinions. And it was a wonderful way to really sort of get a lot
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of interest in excitement. And now with my newly launched Innovation office, I
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have tesked our new head of that office, Charles weis with working with the
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broader VC community, FinTechs and credit us to see if we can even do
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more the financial inclusion events. And then also I thought we would do them
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thematically Jeff, so springboarding from financial inclusion and maybe doing something around faster payments,
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How do we really sort of make sure that we're getting real time payments
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for these small businesses who really don't have time to wait for the float and
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things like that nature where we went them paid instantaneously and then maybe we all
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pivot and do more around digital identity. So I tend to like to think
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chart tank like events bring people out that I would never be able to find.
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So that's why I'm so thrilled and more to come on that. So
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let me ask, I'm really curious how you think of the role of the
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regulator in this space, because so often I think two things that someone who's
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been through the startup. One, I got a lot of advice like just
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stay off the radar and don't you know, don't have to know who you
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are until you have to, which I thought it was bad advice. And
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also it feels like the regulator is there to like tell you what you can't
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do, not figure out what you can to tell me. How you think
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about the way a fintech or a technology should he be engaging with the regulator,
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What the regulator's role is as these kind of new technologies are coming out.
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Let me sort of back up with before I go into that, Jeff
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in CUA National Credit Unit Administration, we are quote unquote the FDIC for the
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credit union system in the sense that we ensure deposits for our members. So
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justice the FDIC insures account the jundred and fifty thousand per account. We do
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the same at the National Credit Unit Administration. But unlike the FDICE, I'm
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not justin insure. I am a policymaker. That means that we also regulate
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some forty eight hundred credit unions. That means that they are serving now one
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hundred and thirty five million members of those institutions, so that's roughly a third
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of their American public has a credit union account. And JEFF assets to date
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approximate two point two trillion dollars. So Credit e Is not only have those
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large assets, but they have large loan volume one point five trillions outstanding and
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loans. So I as a regulator, I'm a safety and sounders regulator.
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So are the members of my board. We're making sure that we are paving
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the way for Credit US to have the policies that can keep them safe and
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sound, where also adhering to the fidelity of consumer protection consumer compliance. So
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yes, there is a regulatory hat that I'm looking at interest rate, interest
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rate risk, liquidity risk, all the other things that you expect a regulatory
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body to do. But because of my having worked for twenty plus years in
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financial services, I've been blessed to work with a number of Wall Street firms
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where I've done affordable housing, economic development, commercial lending. I see the
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role that these lending activities can play with credit unions and the thing, Jeff,
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I'm such a proponent of fintech because not everyone now is going into the
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traditional brick and mortar branches of yesterdayear to conduct business. So when I talk
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about embracing technology and fintech, it's not doing it because it's the luxury.
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I think pre COVID, we all probably thought of fintech and products. It's
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just inn't that a cute little toy. No, it is going immediately now
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from a cute little toy to a strategic comparative. So when you hear me
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as the former chairman of our agency and now board member of our agency,
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when you hear me being so arduous in my pursuit of fintech. It's not
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chasing the toy, but it is making sure that credit Enians have the tools
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to remain vibrant and sustainable in today's environment. One hundred and thirty five million
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members, six million of those came during the pandemic, and a lot of
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those folks you all who joined us, they were Zen generation Z, there
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were millennials. There are folks that really are coming from a digital native environment
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as opposed to the analog environment of my generation. So I will not have
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an industry to regulate if credit us are not using these types of tools.
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So that is why it is more of a business imperative, and I would
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not be setting them up to thrive as twenty first century institutions if I am
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not giving them the regulatory empowerment and flexibility to embrace these new and margin technologies.
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So Jeff I launched a series called a Fintech Discussion Series where I meet
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with FinTechs like yours, and what happens is when a credit e and enters
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into a relationship with a fintech. That means that when we are doing that
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natural examination, we can ask about third party providers. We're looking at the
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lenders with whom they're partnering, and frankly, examiners can be a little risk
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averse, not saying that they don't like to see change innovation, but if
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credit e and examiners don't understand the nature of that fintech or the nature of
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what's going on, they will assume the words and want to shut it down.
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So I recognize that with twelve hundred credit union service organizations, look at
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those as organizations that support credit unis and their day to day activities. If
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four hundred or those twelve hundred or FinTechs, I don't want there to be
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a disconnect between my rhetoric and the exam experience. So every week we bring
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in a intec in fact your company has presented, we have them come in,
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we ask questions. I immediately tell the FinTechs, this is not your
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elevator pitch, this is not shark tank. This is just getting your examiners
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of your partners comfortable with your compliance and things of that nature. So I
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am looking at it as forward thinking. We also, Jeff of providing guidance,
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I mean meeting the credit unions themselves. They now know that we are
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encouraging them to engage in fintech partnerships because we told them look at these as
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you would with any other third party. We also gave guidance letters around the
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use of digital assets and distributed letter technology. These are all tools that today's
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should array wants to have happened. If they don't see them, they're going
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to walk. And again, if we don't embrace it, then will I
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even have an industry to regulate a few years from now. So sorry for
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such a long winded response, but I wanted to why the lens and under
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which I am looking at technology and the wonderful role it plays. I love
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that answer because I do think I've seen that many agencies, the disconnect between
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the offices of innovation and then what happens when an examiner walks into a banker
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credit union of the field and go, yeah, we just talked to the
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opposite relation. They were all on board. No, oh, that's that
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disconnect can be really jarring for the financial institutions on the other end of it.
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And so it's great to hear how you're You're right, it can be
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jarring. And I don't know if any of the listeners of today's podcasts.
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Have ever watched this movie The Exorcist with Linda Blair many years ago, and
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as she has that head spinning exercise, and you have the head spinning,
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you'll have credit Union board. Since CEOs and chief lending officers all want to
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embrace the technology and then they hear from me one day, but then there's
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that disconnect. So one of the things that I'm doing is my new head
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of Innovation is going to be doing a road show where he's going to be
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traveling around the country to do listening sessions. We're going to have him at
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some of the venture capital events. I also am working with him. You
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mentioned the other offices of innovation in CUA. Is really fortunate, Jeff,
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and that we were among the last of the financial regulatory agencies to create the
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new office. So the FDIC head one, the OCC head one, the
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Office of the Coumptural Accuracy that's what that is, Federal Reserve Commodities Future Trading
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Commission. Almost every agency had one, with the exception of ours. And
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I want our viewers to know I was not creating the office because I wanted
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us to have our own just to keep up. I wanted to have our
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own because I saw from some of the things that they were doing, I
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knew what we could do differently. Sometimes the agencies within government they have an
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office of Innovation there that agencies best kept secret. I don't want our Office
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of Innovation to be a secret. So that's why he's going to be doing
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listening tours, op eds, helping convene FinTechs. Jeff, I'm also wanting
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him to look at some tech sprints. How do we find opportunities to have
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a product a problem. Put some FinTechs in a room, and maybe a
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week later they tell us what those solutions are. Another piece is sandboxing.
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I just recently present it to a group of building societies in the UK.
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Their version of credit use is what they call building societies there. So I
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present it to the United the Financial Conduct Authority that's their prudential regulator, and
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we talked about sandboxing. So, Jeff, your earlier question you talked about
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the regulatory piece. So one of the things that I tell folks is let's
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do some regulatory sandboxes where we have that fintech meet with us at NCUA.
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Let us determine what may make sense from a regulatory and compliance standpoint to work
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out the impediments. The last thing you want to have happen is for that
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social entrepreneur to go live and then we find out that they are not adhering
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to fair living a fair housing protocols, and then you have that bad experience.
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The investors are upset because that fintech has gotten a fine or warning.
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But let's do the regulatory sandboxing. I think we've seen some wonderful models of
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that for my peers and London and also the folks in Singapore. So that's
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when you were saying earlier that people were saying stay and keep your head doubt.
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No, let that regulator know so they can work with you. And
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again we are not their prudential regulator. But again at the end of the
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day, I want one hundred and thirty five million members of our credit uns
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that we oversee to have a seamless, frictionless, frictionless experience when they're dealing
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at that credit end, and FinTechs can do that. So no, let's
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work together with them in partnership for the greater good. Yeah, I will
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just plug that as well, because I did say we got a lot of
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advice that was to keep off the radar, and you know, we did
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the opposite. This will this will amuse you. But we were you know,
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when we started doing our first AI and we said, well, how
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do you think about fair lending? We said, well we should call the
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CFPB and being new on the job, kind of your examiner point like,
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we walked into the enforcement office and the local but that was probably not the
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best place to raise your hand and go, hey, we're doing something here.
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We'd like to understand the regulatory environment, you know, like maybe the
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Office of Innovation was a better for sure. I think just then there's a
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shared idea and things of that nature. So Jeff again, I want our
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folks to know, reach out to your regulator, get to know them.
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Also, I'm going to be asking my innovation head to do roundtables even with
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his peers. You know. A credit union solution around using data to make
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more informed decisions. It's something that I think the banks would want using artificial
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intelligence and machine learning to help with suspicious act they reports and bank secrecy out
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compliance. Those are things. So I'm want to be looking for shared solutions
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that we can bring all of our offices of innovation together. I also would
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like for them to look at doing some office hours. So again, it
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took me two and a half years to find our head of innovation because I
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had plenty of people who wanted to take that role when I was offering it
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to have more of a compliance approach, and their approach that was just say
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no, and I wanted someone who can just say yes and get there without
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any degradation and asset quality, compliance protocols and anything of that nature. So
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I hope that in the days a hit that you will get to meet our
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new head of innovation. I want to dive into the office you set up,
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because it's not just the Office of Innovation, if I understand right,
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You made it the Office of Innovation and Acts, which is an interesting pair
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of things to put together. So talk to me a little bit about how
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you see innovation and access kind of coming together and being kind of two sides
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of the same points. It's not mostly offices of innovation or not innovation and
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access. They're just offices of innovactually, right, And Jeff, I knew
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that that was going to be something that I was going to be running counter
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to what other agencies were doing. My background just a little bit to be
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quick. I was a missionary in Africa. I lived in Zambia and Zimbabwe.
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I thought I was going to become an episcopal priest and I was just
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going to do a lot around saving lives and things of that nature. But
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unlike the movies, I never was jostled for my bid at four am with
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lightning and thunder and then just waking up and actually like, well, gee,
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I guess I'm not wanted in this bill. So I went into finance.
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So I've been in banking financial services for the better part of twenty five
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years now, but working in affordable, healthy economic development, urban renewal.
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So what my priest later said was, first of all, no one has
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to wake up call at four am to bolts of thunder and lightning, So
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where did you get that from other than movies? And then also he wanted
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me to know that I needed were the clerical caller to really make a difference
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in people's lives. And I have long been a champion for serving the under
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serve. So where the scriptures tell us to serve the least amongst us and
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to serve underserved marginalized communities, I get to do that. When I was
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the Crara offer Sarah for a Wall Street bank or when I was working in
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corporate responsibility for another Wall Street entity. So Jeff along the way, I
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have come to take on financial inclusion as the civil rights issue of my generation.
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I would say collectively our generation. Credit scores determine where you get to
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live, which ultimately determines where you get to educate your children. Credit scores
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determine where one gets to even get the car that they want to drive to
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him from work. And credit scores also, lamentably in some instances, determine
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where you get to work, because without a good credit score, you may
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not even be able to get the job of choice. So credit score so
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much really dictate one's life journey. So I have made financial inclusion a major
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pivoting point for me, and since I do oversee a banking or regulatory agency
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for credit unions, I have made sure that we are helping make small dollar
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loans available. I reference a data point early on with our conversation. Forty
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percent of American households can obtain fo untre dollars, an emergency overlay that with
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a community of color sixty percent, So from the most recent FDIC unbanked Underbanked
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research, sixty percent of minority households cannot obtain four hundred dollars in the event
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of an emergency. And then if you keep going to overlay that with a
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community or disability, it's eighty percent. So yes, eighty percent of communities
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of color with a disabled individual in that household cannot obtain fo hundred dollars.
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So I have taken this issue of excess. How do you make housing accessible,
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loans accessible, credit accessible. So what we are doing is following the
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George Floyd Murder I pinned it up ed in the Wall Street Journal. I
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talked about banks and credit unions coming together to spur healing through financial inclusion through
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financial education. I know you and I are recording today's podcast in a for
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with it being National Fear Lending Month and also National Financial Literacy Months, so
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as Fair Housing Month and Financial Literacy Months. So we're celebrating those two things.
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So I wrote an op ed what I called for these individuals and credit
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in some banks to work together. But you know what Jeff, I mean.
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Yes, the op ed was nice, but we needed something more demonstrable
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than that. So that is where I worked with my senior leaders here and
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I created the Access Initiative, and that stands for advancing communities through credit education,
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stability and support. That means that we're going to have a dedicated person
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who's helping credit dans learn more about financial education, how to distribute that to
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their members, How do we bring on financial coaching, how do we find
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not for profit foundations who may want to do match savings to help that person
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who's never had an account before begin to see the benefits of savings. So
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we created the Access Initiative. Again. It was someone once said that a
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compassion meets empathy, that's when you really get to have demonstrable actions. So
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I was really delighted to bringing forth the compassion and the empathy with the demonstrable
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result through access. And when I started seeing fintech and other companies that were
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working around this space, a lot of the social entrepreneurs, Jeff wanted to
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cure some of these eels as well. And if there's anything I think that
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the George Floyd tragedy has done is catalyzed a lot of folks were wanting to
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invest in underserved, under resource marginalized communities, and nowhere was that more apparent
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than through the fintech community. So I wanted to marry innovation with access because
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it's intentionality. It is saying we're not just innovating because it's luxurious and cool
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and glamorous and sexy. Which I know that's what you enjoyed about it because
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you were probably one of those early pioneers in this glamorous, sexy space.
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But I am looking at innovation to spur greater access. So that's why we
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do have the Office of Invasion and Access Match together. Now again, there
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may be opportunities where they're looking at things that don't fit under the access umbrella
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the day. I think when we have that intentionality, people are knowing as
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to what I want the byproduct to be. Yeah, I mean it to
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be to be honest. That's what really what drove us into the space initially
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when we say what's the problem in the world that we saw that cause us
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to start the company was really there are a lot of people who deserve credit
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who can't get it or a charge too much for it, mostly because we
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as an industry aren't good at understanding that they're not as big a credit risk
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as maybe their credit score indicates, and that that's costing people either access to
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opportunity or it's increasing the price of that access in terms of the cost of
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credit. In a society where credit is is really required to access many of
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the opportunities that we want to make available, whether that's higher education or housing
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or a car to get to a job, that credit is really credit,
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even the job itself. We require that in some instances. And if I
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may, I take a very broad approach when I look at diversity and underserved,
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So I'm talking of course load and moderate income, but I'm also talking
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about those rural communities, those tribal communities. All I'm talking about disabled and
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differently abled populations, and also justice involved individuals as well, folks who may
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have gone through the criminal justice system, made their debt to society, but
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unfortunately, like Heshteprinne from the Scarlet Letter, they're still wearing that scarlet letter.
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So finding ways to bring them into the financial mainstream, finding ways to
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get them financial inclusions. So those are all of the folks that we are
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wanting to work with with this new access initiative. So I'm really proud of
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it, and in fact, I do have a person that's been hired for
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that role as well. And again, the Office of Innovation and Access,
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they're working seamlessly, and again I'm really happy about being able to create that
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opportunity. Let me ask you one other thing, what are the things you're
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most excited about in that access? We talked about the lack of availability of
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small dollar loans. You know a lot of people who need that couple hundred
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dollars in an emergency end up turning to payday lending. I know there's people
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working out Are there things you see or particularly for the banks credit unions that
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are listening, like opportunities technologies say hey, this is a thing that can
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really help increase access or assisted in your ability to work with communities that might
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be less traditionally advantaged. Like what are you seeing out there that makes you
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excited about the future. I'm really excited at you all when I travel around
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the fifty states of our country, when I'm meeting with credit unions and other
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state regulators, and when they talk about how now many of the states are
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requiring financial literacy and financial education to graduate, I am really excited about that
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because there are a number of individuals you all, where people are not teaching
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their parents about children about financial literacy and financial education. I don't want there
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to be these opportunities where these children in high school students they are going off
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to college and they are signing up for a free credit card because they get
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a free T shirt. And trust me, that five dollar T shirt is
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not worth being saddled with debt for most of your professional career. So I'm
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really excited that financial literacy and financial capability are really really being taught in some
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of the different high schools. And again, I understand that there are a
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lot of districts around the country that are really making that a requirement, and
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I think that's so important. I'm also excited that I'm starting to see an
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emergence and credit unions, of high school credit unions. That means that credit
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unions are taking some of their resources and putting a branch in a high school
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and letting the high school. In fact, just a few weeks ago,
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I was in Lincoln, Nebraska. Why I was with a group of ten
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year olds who were taking their allowances and putting in the credit union and they
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were doing all the appropriate work around knowing your customer and Bank Secrecy Act.
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And again, the ten year olds had a minor grasp, but what it
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takes to run an institution. So I'm excited and very bullish about the growth
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of financial literacy and education in high schools, the fact that our credit unions
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stepping up to the plate and making it possible for people as early as ten
25:03
years of age to have access to credit unions that they are owning and operating
25:07
themselves. I'm also very excited about just the fact that we are seeing a
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number of denovo credit unions that are coming. So that means that these are
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new chartered entities who are saying, hey, we see some momentum. We
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love the excitement, and a lot of them I wanted to be digitally native.
25:23
So again, many of them may never have a brick and mortar presence
25:27
of yesteryear, which is what my generation is accustomed to. So the fact
25:32
that there's excitement about credit unison, and I'll tell you what the excitement is,
25:34
Jeff, I probably should have talked about this at the onset. Credit
25:38
unions are owned by the members, so that means that those hundred and thirty
25:42
five million people that I reference as having a credit union account, that means
25:47
that they have all invested five dollars a minimum to join the credit union,
25:51
which gives them a shared governance of that credit union. That means that one
25:55
share one bode. So whether you have five dollars in your credit union or
25:59
up to the in short maximum two hundred and fifty, you all get one
26:02
boat when it comes to looking at governance and your board members. But also
26:06
credit unions they grew out of necessity following the Depression, when the hard work
26:10
and men and women from the automobile plants and manufacturing entities they could not get
26:15
traditional main street financing just because they were considered the lower income of their generations.
26:21
So what did they do. They galvanized. They reached into their pockets
26:23
and took whatever change they had and they started lending it to each other.
26:27
So out of that grew America's system today of credit use, or the system
26:33
of cooperative credit. What I'm trying to picture here for you all is that
26:37
it all grew out of people helping people. So now, nearly a century
26:41
later, that ethos still is embodied every day. So when I mentioned those
26:47
six million people joined over the pandemic, it was Generation Z was millennials.
26:52
Because credit enians are purpose mission driven institutions. If there's anything that this younger
26:57
generation cares about is the ability to make a difference. They want to know
27:03
is their institution investing in underserved, marginalized and credit unions do that not because
27:07
of some of the government regulations that many instances do require banks to do that.
27:12
In fact, I had a role. I was a Community of Investment
27:15
Act officer, but not governed by that. So the fact is that I'm
27:21
seeing excitement around this emergence now of people wanting to create their own credit unions.
27:26
There was an African American sorority that just created a credit union. I
27:30
was there to meet with them. There is an Episcopal church in New York
27:34
that has just created a new credit union. There was a tribal group in
27:38
Montana. So we are seeing, even in the midst of some of the
27:41
headwinds that I know that all the viewers are aware of and financial services,
27:45
even in the midst of those, there is a port in the storm where
27:48
folks are wanting to see the value of owning mission based, purpose driven institutions.
27:55
And that's what makes me excited and bullish about the future. Jeff,
27:59
I love it, and I love the I mean I love all that and
28:02
people helping people as such. A that was one of the fascinating things for
28:06
someone coming from the technology Not that the technology issue's not interested in helping people,
28:10
but I think there's that perspective of bankers that comes from Wolf of Wall
28:12
Street and whatever. Maybe you're run in with an investment banker and you know,
28:17
and then when you when you come to the credit union community are all
28:19
equally. I think the community banking community, you really get to people that
28:23
feel a lot more like it's a wonderful life, that are they're trying to
28:26
help our community and do the right thing. And that was It's always great
28:29
to see. And I love your statements on financial literacy because I felt like
28:33
it's for many years, like it's criminal that you can let students graduate from
28:37
high school and have no base understanding of even simple economic concepts like you know
28:41
aprs and interest rates and what compound or simple interest and what they're what a
28:45
credit card? I run it up and then what does it really mean and
28:48
how much is it going to cost? Like it's just it's terrible that people
28:51
are that we're relying exclusively on families to pass along that knowledge and not providing
28:56
it to our children because it's it's crucial knowledge to be able to operate in
28:57
the in the modern economy. And Jeff, it really is. And if
29:00
I can go a step further, and many people think it's the communities of
29:03
color, it's those lodomotored incomes communities where the families are not sitting around the
29:08
table and talking to their children about these topics. I beg to differ with
29:12
that. I want folks to know I have been fortunate to visit some of
29:15
the credit unions at the IVY Leagues. We have Ivy League credit unions.
29:18
We have collegists in California with credit unions, and I want you to know
29:22
that the students that are at those prestigious schools also have never had a parent
29:29
sit down with them. So this is a dad who may be CEO of
29:32
a Wall Street firm, or whose mom may be a nuclear physicist. But
29:36
the point is, I want folks to realize that it's not just something for
29:38
lodomotored income or minority communities. In fact, Jeff, I had a CEO
29:44
and this is of a I'm not going to name the Wall Street firm,
29:45
but this father best borderline apoplectic that he was at some event with his son
29:52
and the son was using the debit card and the credit card. He said,
29:56
well, son, it's the same if he said to the father,
29:57
but it's the same thing, debit and credit card. It has the same
30:00
numbers, it has the same insignia. No, those are totally different.
30:04
So this is uh, that's offspring of someone who, let's just say,
30:08
kind of knows a thing or two about credit. But for some reason,
30:12
you don't teach these concepts through osmosis to your off springs. So I want
30:17
folks to know that no matter what your income level is or educational attainment,
30:22
these are all things that people can learn from because I sometimes think people just
30:26
think it's just one group of people to know. I've seen it come full
30:29
throttle throughout all levels of society. It's just something that we just need to
30:33
spend time on it. Again, what a better time than now, with
30:37
it's being national financial literacy, want to at least talk about it. Jack.
30:41
It is amazing that and not just the kids of the finance of it,
30:45
that the number of well educated professionals I run across it just don't you
30:49
know, they find out I'm in the finance space and they have just basic
30:53
questions and you go, I know, like, how do you get by
30:56
in life without knowing these things? But we don't. It's not like not
31:00
just a high school or you can get through college grad school and never have
31:03
taken a single of course on economics or personal financing. It's yeah, what
31:07
it means to look at the credit card and again that five dollars t shirts
31:11
that they're giving you because you're taking out a credit card. And I do
31:14
have to tell you, I have a pet peoplehen ever a fly and you're
31:17
the first group that I've ever mentioned this to you, and I have to
31:19
I'm pretty mild mannered, is I hope your audience can tell. But if
31:22
there's one thing that gives me othelli's rage from Desdemona, and that is when
31:29
I'm on a flight and we are about to land and you're looking at your
31:33
messages and they start with the credit card solicitations. The flight attendants are walking
31:38
around giving everyone who raises their hand that once, and I'm like, no,
31:44
you're setting them up for this unexpected, unrealistic expectation that all it takes
31:48
is to get a credit card. But you're not coupling it with any financial
31:52
literacy financial education, and the reason I get voted on apoplectic when I see
31:56
that it's almost not showing any respect for what we do in financial services,
32:00
whether we are regulators or whether we're working at banks or credit eians. It
32:05
just makes I don't want to say, a mockery out of what we do
32:07
in terms of extending credit, and I just think it just cheapens the experience.
32:12
So I've got it off my chest that I just wish that they would
32:16
not do that because it just sends the role message that that financial services just
32:22
about handing on a flyer and then you go home and magically you're you're getting
32:27
this account stop of some sort. It doesn't it all gets paid for,
32:31
right. I Mean that's one of the things every time my kids are in
32:35
a casino or whatever, and I'm going, you know, I go,
32:37
people win money at these games that I go, you see this really fancy
32:39
building you're walking around in. It didn't come because most people make money playing
32:44
the games. It came because people exactly well, Jeff, but now they're
32:49
absolutely right, I hear you. So that's all there were reason around financial
32:52
literacy education coaching and podcasts like this, and again, there are some FinTechs
32:58
that are creating like training modules that can be done via the iPhone or the
33:04
Andrew I'm not making an endorsement iPhone or Android, but then you can access
33:07
the tools and things of that nature. So I'm really glad that the fintech
33:12
community is embracing some of these Around education, it needs to be ongoing.
33:15
It's not like turning it on and off like a faucet. It needs to
33:20
be ongoing and really incocated throughout all areas. I think of society absolutely a
33:28
nice way to end the conversation in Financial Literacy Month to talk a little bit
33:31
about the importance to financial Maybe we both ranted a little bit now, but
33:35
it's an important topic, right. I got three questions I ask everybody at
33:37
the end of this podcast, Son, I'm gonna give them to you now.
33:39
Okay, First, what's the best career advice you've ever gotten? The
33:45
best career advice I've ever received is recognizing that not every promotion has to be
33:52
a promotion. Sometimes you can have a lateral move, So don't think of
33:55
your career as being linear. We want to go from associate to managing director
34:00
in two years. Sometimes you may need to do a few lateral moves to
34:04
build out your core competencies, to also learn about a different team looking at
34:08
different ways to problem solve. And I would say in my early days,
34:13
I looked at a lot of my career progression around it being so linear,
34:16
and I recognized it as I got sort of the mid level that sometimes you
34:21
can do that lateral move that's going to expose you to a totally different product
34:23
or totally different way of thinking, and that's really helpful. So everyone look
34:30
at some lateral moves, not everything as linear, and also volunteer for projects
34:36
as well. That can also help you build out a skill set that you
34:39
may be lacking for projects and look for the lateral lateral opportunities. I always
34:45
love that. Maybe maybe it's an overly quote with the Steve Jobs commenced whore
34:50
we so you can only understand a career looking back, like so you got
34:52
to kind of you know, if you plot it out too far ahead,
34:55
it's never going to play out that way. And you've got to be open
34:58
to the interesting moves that are a available, the opportunities that are there,
35:01
not just the one thing. So I'm supposed to be vice president next.
35:04
I gotta gotta get that, you know, exactly, and that creates disappointing
35:07
opportunities. And almost for every role that I've had, it's almost found me.
35:13
I don't think that I've ever really sought a role outside of when you're
35:16
like in college, when you have the career fair and you're sort of working
35:20
with the firms that come to the campus. And for me it was at
35:22
the University of North Carolia there Chapel Hill. But after that you all people
35:25
start finding you, and your network sort of creates opportunities. So I tell
35:31
folks, just be receptive to whatever comes your way. And I've also been
35:37
blessed even with my work in public service. As you know, I've served
35:39
now in two different presidential administrations, and one does not just call the president
35:44
and say, hey, pick me. It's just any number of variables.
35:46
I know when to this date has ever told me how each time I've been
35:50
selected, Jeff. But but I was amenable to the phone call. I
35:53
tell folks a day, I said, you never know who's going to call,
35:57
and sometimes part of life is just showing up, but show up being
36:00
prepared. I think it's a big help love it. It's like a question,
36:04
what's the best piece of advice you've ever gotten about the banking sector or
36:07
the This is a kind of interesting one to ask you that, But the
36:08
consumer banking space. The best piece of advice I've gotten about the consumer banking
36:15
space is that bricks and mortar may be disappearing. And we've been talking about
36:21
that now for about the past ten fifteen years. And the advice that I've
36:24
been given us again to embrace the technology, to embrace some of the handheld
36:30
devices, because many people can now use those devices to get a loan,
36:34
to make a payment. And the big advice now is if you're going to
36:37
really replace replace bricks and mortar, what are you going to do to still
36:42
be tethered to the customer? In my case the credit you member, so
36:45
as credit need for embracing digital platforms, what are they doing to still define
36:50
their value prop what are they doing to really show that they are building a
36:53
relationship as supposed to the transactional aspects of aspects associated with a member. So
37:00
I think the best advice is recognize that that bricks and mortar may be a
37:04
thing of the past, But what do we do to still build the relationship
37:07
and have that sticky feeling. And I think that's the one advice. And
37:12
I learned about that twenty years ago and we've been hearing about it, but
37:15
now I think that really is manifesting itself. So not saying that bricks and
37:19
mortars will be completely gone, but I think that the best advice has start
37:23
thinking about how do you build a culture and an identity and a brand.
37:27
Recognize that you may not see those folks face to face as often as we
37:31
used to. Yeah, that's it. I think they are necessarily disappearing.
37:36
But people don't want to have to come into the branch to do things they
37:37
don't need to come into the branch to do and need, meaning that one
37:40
actually talk to the person, not forcing them to do it to depositive chapter
37:45
or whatever it might be exactly and when we do have them come in now,
37:47
Jeff. So that also means that if you're going to be able to
37:51
use the video tellers and the automatic tailor machines for a lot of those routine
37:55
businesses, that means that we in financial services, whether it be banks or
38:00
is that means that now that person that is in the branch for those face to