Two tech trends
The actual technologies that will emerge in 2030 may not be apparent today, but the technology trends that will drive them are here, two in particular:
First, technology’s benefits will be increasingly available at lower cost points. For example, artificial intelligence (AI) which today we see as the province of players such as IBM’s Watson, Google or Amazon, will be much more accessible to smaller financial institutions.
This is great news for smaller financial institutions.
The second major trend is that technology will increasingly empower the individual in easy and instantaneous ways.
The evolution of the mobile phone to supplant cameras is virtually complete. How many people today purchase any camera other than those at the very high-end?
And in the not too distant future the mobile device will become the all-encompassing digital assistant that Siri portends, managing a wide variety of consumer needs on behalf of the consumer.
So, what will this mean in practice? First, virtually all transactions will happen in real time. Second, passwords will be passé, to be replaced by much more secure means of identification.
Third, the use of intelligent digital assistants will be widespread, most notably via the device we today call the phone.
Part of this will stem from the extension of AI into everyday life. The consumer will have at his or her fingertips tools that can help them be more successful financially.
Credit union differentiation will lie in the trust and feeling of partnership that an individual institution is able to engender among members and small businesses.
Fintechs as partners
One last thought regarding emerging fintechs. Today, credit unions worry about how to compete with them. In 2030 the discussion will be different.
As much as institutions may fear the rise of these companies, emerging fintechs lack the brand and trust credit unions have built with members.
With a few notable exceptions, fintechs are more likely to be credit union partners in 2030 rather than competitors, as they’ve identified ways to reduce the cost curve that can benefit both parties.
In fact, plan to outsource a lot more of what you do today to firms that can do things more cost effectively, allowing you to focus on building and maintaining your relationship with your members.
BILL HANDEL is vice president of research for Raddon.