The Impact of Internet-Based Services on Credit Unions: A Propensity Score Matching Approach

37 Pages Posted: 10 Jul 2013 Last revised: 23 Jul 2014

See all articles by Elisabeta Pana

Elisabeta Pana

Central Connecticut State University

Sascha Vitzthum

Emory University

David Mitchell Willis

Illinois Wesleyan University

Date Written: January 9, 2013

Abstract

Credit unions focus their profit management on providing benefits to their members and augmenting their institutional well-being through capital accumulation. In this study, we investigate the changes in benefits to borrowing and saving members around the adoptions of transactional websites by credit unions for the period of 2000-2009. Using the propensity score matching method, we show that credit union adopters offered borrowing members a better interest rate than non-adopters immediately after the recession of 2001-2002 and a similar rate when economy rebounded. Our results indicate that transactional websites offer credit union members more convenient services with no negative impact on the interest rate on deposits. The results are robust to different definitions of internet-based services non-adopters and different models used to estimate adoption probabilities.

Keywords: Credit unions, Information and internet services, Technology, Value

JEL Classification: G21, L86

Suggested Citation

Pana, Elisabeta and Vitzthum, Sascha and Willis, David Mitchell, The Impact of Internet-Based Services on Credit Unions: A Propensity Score Matching Approach (January 9, 2013). Review of Quantitative Finance and Accounting, Forthcoming. Available at SSRN: https://ssrn.com/abstract=2291548 or http://dx.doi.org/10.2139/ssrn.2291548

Elisabeta Pana (Contact Author)

Central Connecticut State University ( email )

1615 Stanley Street
New Britain, CT 06050
United States

Sascha Vitzthum

Emory University ( email )

201 Dowman Drive
Atlanta, GA 30322
United States

David Mitchell Willis

Illinois Wesleyan University ( email )

P.O. Box 2900
Bloomington, IL 61702-2900
United States

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