From branch usage to financial management to payments, the COVID-19 pandemic has changed member behavior, triggering a rapid digital transformation that is still accelerating. We expect many of these shifts are here to stay, making it imperative for the credit union industry to continue innovating, investing, and building toward meeting and exceeding members’ evolving expectations.
It should come as no surprise that many members moved to more digital and contactless interactions during the past 18 months. In response, credit unions must ensure members have access to the latest digital offerings and contactless payment options, or run the risk of them seeking out those options elsewhere.
While younger generations value immediacy and ease of use when it comes to payments, they are also among the first groups willing to adopt new ways to pay through offerings including cryptocurrency, person-to-person (P2P) payment solutions such as Venmo, and buy now, pay later (BNPL) options. In addition, these generations often prefer online or in-app chats with 24/7 virtual agents to talking with live agents or visiting a branch.
With payments becoming “invisible” and transactions taking place over computer and phone screens, it is more important than ever for credit unions to ensure they enable members to transact wherever and whenever they prefer. While younger generations might be more apt to adopt these payments methods, these behaviors will eventually permeate across other generational segments, making it important to address these needs now.
What should credit unions do to keep pace with evolving member expectations? Consider innovating from within and creating a culture of innovation across the entire enterprise. Innovation does not come from just one team or one business unit; rather, it comes from everyone collaborating and working toward the same goals. Innovation succeeds through disruption, but it is only successful if we find ways to disrupt our own industry before we get disrupted. Although a natural part of the path to innovation is failure, it is essential to fail fast, learn from the process, and move forward accordingly.
While innovating from within is critical, some challenges cannot be solved by a credit union on its own. Many big banks opt to fill infrastructure gaps through strategic acquisitions in the fintech market. The credit union industry should similarly leverage fintechs to solve technology or infrastructure gaps, leading to better user interface (UI) and user experience (UX) design and a better experience for members.
Now is the time for the credit union industry to create and leverage ecosystems of innovation. Invest in staff to enable innovation from within, and explore strategic partnerships to bring in innovation from the outside. Then, find ways to meld those forces together to create the best experiences for members. This will enable credit unions to keep pace with the speed of change in the financial services market.
VLADIMIR JOVANOVIC is innovation manager at PSCU.