Managing bank and credit union reserve cash is a complex exercise: manage it too tightly and your institution may be subject to high-interest Federal Reserve borrowing fees. Manage it too loosely and your firm may lose out on substantial interest revenue from parked cash.
Our client, a wholesale financial services provider to hundreds of credit unions in the U.S., traditionally kept a large volume of cash in reserve to account for member credit union activity. Since these credit unions conduct business autonomously, the organization was constantly challenged to predict members’ cash reserves without any direct control or visibility. It was time to explore opportunities to apply advanced analytics to predict member activity and drive better returns on reserve cash, and that’s what led to their partnership with the Fusion Alliance team.