Traditional, service-focused, and community-based are three descriptions that come to mind when thinking about credit unions. The traditional, high-touch aspect of credit unions, was virtually stopped in response to the global pandemic. In order to maintain the service-oriented mindset that sets credit unions apart from other financial institutions, credit unions have had to adjust the way they bring services to members.
Credit Unions Need to Go Even More Digital
The global pandemic caused credit unions to adopt a remote-work business model within record time. One COO was quoted as saying “the pandemic forced 10 years of digital migration into 3 weeks!” Currently, 46% of people exclusively use digital channels for their financial needs. This is especially prevalent with younger age groups. Credit unions must continue to transform their mobile banking capabilities in order to provide the services their members require, where the member requires it! Adoption of digital channels is expected only to grow, as the pandemic forced late adopters to go digital much more rapidly.
Historically, credit unions would receive a pass on not having the most up-to-date digital experience, as they could make up for less effective digital with higher-touch. That leeway is no longer available as everyone has had to migrate to a digital experience just to weather the pandemic. Additionally, rather than only competing against other credit unions or community banks, this massive move to online channels has credit unions competing head to head on digital experience with mega-banks and other fintech companies.
When we interviewed Mark Werner about his experience as Chairman of the Board, of Quorum Federal Credit Union, he stated: “Our credit union is almost becoming a fintech company. We’ve closed all of our physical branches and have gone completely digital in the last year, and we need to ensure our online experience is up to par with the big banks.”
Attracting Younger Generations
One thing top of mind for most credit unions right now is attracting younger members to their credit unions. As digital natives, these younger generations require a seamless digital experience in just about everything they interact with. If your credit union does not have a digital experience on par with Bank of America or Chase, they will likely choose the better digital option.
What does a seamless digital experience look like?
As stated above, post-pandemic consumer behavior will shift to a digital experience– that is almost always requiring phone accessibility. In order to prepare your credit union for an upgraded digital experience, you must first consider what may need to change. Does your current technology offer these digital options?
- Mobile Payments
- Member ID Verification
- E-Sign Solutions & E-Notarizations
- Online Loan Applications
- Secure Online Chat & Text Messaging Capabilities
- Secure Data & Document Transfers
- Video-Based Remote Banking Tutorials
- Online Account & Membership Opening
Another aspect of this mobile experience is the time investment piece for members. Do you have the software to immediately approve or deny loan applications? Do you have the capabilities to offer help to members 24/7? If not, how can you differentiate your experience from competitors who do?
The long-standing differentiator for credit unions versus banks is the service aspect of credit unions. At the forefront of everything credit unions do is the mission of service to members first. Your members and prospective members need to understand that they are the focal point of everything you do. In the past few months, and years, that service may look different than it did ten years ago.
These next three to five years will be absolutely critical in differentiating your credit union. As a leader of your organization, you help guide your credit union to success or failure. It’s time for innovation, creativity, and some changes in the credit union space. It’s important to understand that this transition into a seamless digital experience is a marathon, not a sprint. Take it step-by-step to ensure your mobile experience is functioning at the highest level for your members.
Although this change has been largely forced upon the industry due to the current global pandemic, these difficult times offer a unique opportunity to return to innovation, to creativity, and to the mission of credit unions as a whole.