There’s a rate war going on, and credit unions, unfortunately, are not on the winning side right now. Why? The auto loan landscape has changed. A member who financed their first car with your credit union five years ago is now sitting at a dealership and listening to the captive lender offering 0% interest for the first 36 months. The best rate you can offer is 3.5%. The dealer is happy as long as their cars get sold, and the member, elated by the 0%, drives off in the new car without a second thought about who held their last loan. In this scenario, how can credit unions get back their share of the auto loan market? What types of loyalty programs or member-exclusive benefits might they offer for auto loans?

Why credit unions are losing members

This scenario outlined above is a reality across the country. While the industry as a whole might seem to be gaining members and income, individual credit unions are losing both members and market share. According to RC Strat, 56% of credit unions lost members in 2024, with smaller ones seeing a membership decline of 6% or more, along with a decrease in loan growth of 9.5%.

Data from Experian shows that credit unions are losing the auto financing battle to commercial banks (29.29%), captive lenders like Toyota Financial, Ford Credit, and GM Financial (27.55%). Credit unions now hold only 19.56% of the auto loan market share.

Clearly, this is no blip that can be fixed by rate adjustments. Banks offer instant approvals via their apps before a credit union can even begin its process. Automakers’ captive finance arms can offer rates that no credit union can match. Credit unions that understand the changed landscape are already looking elsewhere for the answer.

Relationships not rates

Credit unions that are recovering lost ground are not doing it by cutting rates. Take Nuvision Federal Credit Union, for instance. This Huntington Beach-based, California credit union offered its members a relationship-based loyalty program called Added Advantage, which rewards members for the depth of their relationship. The results speak for themselves. In Q4 2025, Nuvision’s loan growth was 15.4%, more than double the 6% peer group average for similar-sized credit unions.

Sea Air Federal Credit Union took a different approach. Faced with a sharp drop in their auto loan market share as captive lenders nibbled away at their member base, SAFCU partnered with Way to attach a bundled car-ownership benefits program, Way+, directly to their auto loans. As a result, members who refinanced through SAFCU got cash back on fuel, parking, car washes, and more, along with automatic insurance monitoring to reduce delinquencies. The program went live in two weeks, with no tech effort from SAFCU’s end. Here too, it was hard to argue with the results. Within six months, refinanced auto loans per month were up 47%, member interactions increased by 50%, and repayment consistency improved by 30%. One SAFCU member mentioned that before Way+, they were paying too much for their auto loan and spending over $150 a month on gas. They stated that after refinancing, not only did their monthly payment decrease, but they also began receiving cashback on gas and car washes. They felt like their car was paying for itself now. That is the kind of member sentiment that can make a difference in a refinancing choice.

What can credit unions do to try to get more auto loan market share?

Remember that member who drove off the dealership with a 0% captive loan interest rate and without a second thought about you? They’re not lost forever. They now have a car that needs fuel, parking, maintenance, roadside assistance, and car washes. Discounts on any one of them would be welcome, and discounts on all of them? That, as Don Vito Corleone would say, is an offer they can’t refuse. The credit union that offers them these savings has something that no captive lender can offer – an ongoing relationship and a daily presence in their life.

The question most credit unions face is how to deliver this without having to rebuild vendor relationships from scratch. Setting up and running separate partnerships for fuel discounts and parking is daunting in itself. Add to that car washes, repair, and roadside assistance, and you’re talking about a significant operational lift from the credit union. Or they could just use an integrated all-in-one service for both the aggregation and delivery.

That’s why smart credit unions have opted for Way+, a membership program that’s built specifically for this. It offers credit unions a bundled ecosystem of car ownership needs that can be customized and attached directly to their loan products. Even better, it can be white-labeled too. Members get recurring value, and credit unions get constant engagement.

The window is open, but not forever

Right now, credit unions have something that captive lenders cannot replicate. Their member-first model, the community trust, and their willingness to help when a member hits a rough patch. The problem is that’s the kind of advantage that can’t be seen in loan comparison calculators at dealerships.

Credit unions that make the smart decision to embed themselves in the daily economics of car ownership are building something a competitor cannot undo with a rate cut six months down the line. They might match your APR overnight, but they cannot match months of fuel cashback showing up in a member’s account.

If you feel this is worth exploring, the Way team would happily walk you through how we’ve helped credit unions like yours. That’s a conversation definitely worth having.