Meet Abhilash Jayakumar. Third-year Engineering student at the University of Waterloo and Director of Operations for the Waterloo Banking Project - what could potentially become Canada's first-ever student-run and student-oriented credit union. Along with co-founders Ryan Chen-Wing and Megan Chan, Abhilash has been caught between helming the fledgling Project and juggling engineering courses tougher than a water buffalo's hide, but recently I managed to lasso him in to fire a few questions at him.
(Photo: left - Abhilash, right - Ryan Chen-Wing)
It's great meeting with you Abhi. I've a done a little reading of the Waterloo Banking Project's blog, but could you just give us a quick backgrounder on what the Waterloo Banking Project hopes to achieve, and how it plans to go about it?
Thanks for having me here Prashanth.
Let me start by saying that the Waterloo Banking Project is currently conducting background research on the feasibility of starting a student-focused credit union in the Waterloo region. We would be the first of our kind in Canada; although there are many banking options, in my opinion none of them currently serve student needs well enough.
Our long-term goal and vision is to have students graduating with less debt, more money, and better financial skills. We intend to achieve this by offering services and advice that can help students while they study in school, by working with them to build a financial plan that will set them up with a budget they are comfortable with, and by offering them financial support as needed.
The three pillars of this venture are Student staff, Partner institution and Benevolent Investment - these three elements embody the underlying premise of our credit union.
An unpaid, professional student staff will greatly reduce our operational costs. We offer valuable work experience to our staff, which they can leverage towards future employment opportunities. By partnering with an existing credit union, we would be able to offer financial services without pursuing a charter independently, while helping our partner credit union gain more customers. Also, in order to raise investment capital, we would have to approach alumni from the two universities in the region (UWaterloo and Wilfrid Laurier U) and other local institutions.
By building on these three fundamental pillars, we're looking to fulfill our vision of helping students graduate with a reduced debt burden.
I like the idea Abhi, but how is the Waterloo Banking project better than the existing financial institutions that already serve the UW student population? As it is, the university student market is pretty large in this country, and it's also pretty tapped out with financial institutions setting up branches all over campuses nationwide. How does the Waterloo Banking project break the mould here? Who will this co-operative serve? Why?
Well, the primary differences between banks and credit unions is the ownership structure. Unlike banks, credit unions are owned by its members; our Project would be no different from this model, except that our owners would be our student members. When a bank operates, it works to make its investors more money; where as a credit union works towards its members'/owners' best interests.
Another big difference between credit unions and banks is where the profits are eventually funnelled. When you do business with a bank, the profits are eventually shared amongst investors. However, being a non-profit entity, any profit we make will be returned to our members in the form of lower loan interest rates, higher dividends or used to lower operating fees.
We also differ from banks in that we are looking to create products and services that meet students needs; banks offer a limited set of services to a broad market. While they do have student-targeted products, usually what they offer, in my opinion, is prosaic and uncreative. We will use our co-operative structure, professional staff and knowledge of students to better serve our members.
What are some of the financial services that you're looking to offer university students?
I would prefer not to go into detail about the set of products that we are going to offer. We just finished our collecting responses from our market research survey; we are working on some ideas, but need to see whether market data confirms our assumptions. We will be using that information to design a suite of possible products. As a not-for-profit, we will be able to provide products and services at a competitive rates. Since we are focused on students, our products and services can be specifically tailored to serve the needs of the student population more efficiently.
How far are you two from getting this project off the ground? What are you looking to get done in the immediate future?
We're excited for the coming year. We just got back the results from our market research survey, and we're in the process of slicing and dicing the data. We want to build up our organization so that it can be staffed by a capable student workforce, hammer out a partnership with an existing credit union and research and complete our business plan in the coming months. We also want to form an Advisory Board who will guide us in the bringing this project to fruition. This Board would consist of experts in the field who can guide and chaperone us through the process of structuring the organization.
What still needs to be done in order to make this endeavour a reality? Where do you see the Project going in the next 3-5 years?
In two years, we hope to launch the Waterloo Banking Project with a professionally trained student staff, sufficient investment capital, a partner credit union, a full suite of financial services structured to best serve students, and a share of the student market that we can expect to grow each year after that.
Through our project, we want to improve students' financial situations through financial services and education, and reduce the burden of debt that hampers most students. It's our hope that the Project Waterloo raises the profile of Waterloo students amongst all universities, for their stellar financial stability and confidence.
Well Abhi, thanks for taking the time to talk to us in this interview for Techvibes. We wish you and the Waterloo Banking Project every inch of success along the way.
Before we finish, I'd like to take this opportunity to talk about the true founders of this initiative: Ryan Chen-Wing and Megan Chan. The Waterloo Banking Project is their brainchild. Megan just graduated from UW's Master's of Accounting program and looks to devote time in-between her focus on a full-time caree. Ryan, on the other hand, is heavily active with the project; I've had the pleasure of jumping on board with the Waterloo Banking Project last fall and it was mainly due to Ryan's infectious passion for a student-focused credit union that we have come this far in turning an ambitious idea into a promising reality.