Why small credit unions survive on crumbs, on purpose, with Scott Prior.

In the latest episode of the Digital Banking Podcast, host Josh DeTar of Tyfone welcomed Scott Prior, CEO of Connection Credit Union and founder of CUs Unite. Prior led a $40 million, one-branch credit union serving about 3,300 members in Kitsap County, Washington, with a team of 15.

Prior walked through the origin of Banking Beyond Bars, a financial education and lending program for formerly incarcerated individuals that he built within 24 hours of a single conversation with a nonprofit founder. Since the first group went through in December 2024, 130 people had completed the program across 15 cohorts, generating more than $100,000 in loans with under $2,000 in charge-offs, entirely through member referrals and with no marketing spend.

The conversation moved into CUs Unite, the group-buying network Prior founded after watching vendors lose interest in small credit unions as their own asset sizes grew during COVID. Prior argued that growth for its own sake was never the goal, that he tracked loan and member growth rather than assets, and that checking ego at the door was what made real collaboration between small credit unions possible.

Key Insights

A 24-hour idea became a 130-person program.

Prior built the framework for Banking Beyond Bars within a day of meeting a nonprofit founder who told him every other bank and credit union had turned down a partnership to serve formerly incarcerated individuals. He drew on his own experience running subprime indirect lending a decade earlier to design a structured path: three in-person classes on how the banking system works, a certified financial counselor assigned for a year, and a fixed sequence of products, a $500 credit card followed by a $10,000 starter auto loan. Every one of the program’s 130 members came through word-of-mouth referral, with zero marketing spend.

Growth for growth’s sake was never the goal.

Prior said he tracked loan and member growth closely but was indifferent to asset growth, noting his credit union had gone from $20 million to $40 million during his tenure without that number ever being the point. He kept capital deliberately high, around 13 to 15%, because a $40 million credit union was one fraud loss away from serious trouble. His broader argument was that too much ego in the industry, not a lack of scale, was what stopped small credit unions from operating like the not-for-profit cooperatives they were chartered to be.

Small credit unions needed to buy and sell like a group.

CUs Unite grew out of a 2019 group deal in which six credit unions, including Prior’s, pooled their buying power to afford a digital banking platform none of them could purchase individually. Prior pitched vendors on a version of that same logic: one sales effort could reach 30 to 50 credit union CEOs directly, with no middleman and no vendor sponsorships at the group’s conferences, in exchange for pricing that reflected the value of the group buying together rather than one at a time.