Credit Unions Turn to Data to Compete Head-to-Head with FinTechs

Credit Union Tracker January 2022 - Learn about the digital payment innovations that are crucial for CUs to retain members in 2022

Credit Union Tracker January 2022 - Learn about the digital payment innovations that are crucial for CUs to retain members in 2022

Consumers’ digital expectations have a lot of financial services providers vying for their attention, from financial institutions (FIs) to digitally-savvy neobanks and FinTechs. Credit unions (CUs) followed suit, fast-tracking digital transformations and investing in products that will help them stay competitive.

A significant number of CU members engage with peer-to-peer (P2P) payments, mobile wallets and other digital financial products that are not coming from their CU. Simply offering the services they are attaining elsewhere may not be the best approach for gaining and retaining members, however. One of the biggest selling points for CU membership has always been the personalized service that makes CUs more engaging for members.

In the January “Credit Union Tracker®,” PYMNTS examines how digital-first tools, from video banking to in-depth data analysis, can be leveraged by CUs to help enhance the relationships and understanding of member needs they are known for.

Around the Credit Union Space

Compared to their larger competitors, credit unions do not have the same capital and infrastructure to leverage against providing the latest mobile and online banking technology. That fact does not temper the digital expectations of CU members, regardless of the size of their CU. To ensure all CUs have the tools they need, PSCU has partnered with FinTech enablement company ENACOMM to create white-label solutions for CUs seeking prepaid online and mobile app banking tools. CUs can brand the prepaid mobile app and website platforms to present a unified user experience that matches the deploying CU. The tools enable credit unions to provide the latest digital banking solutions without the cost of the time and money spent developing those solutions from scratch.

Just 12% of small to mid-sized businesses (SMBs) receive financial services from a credit union, offering significant room for CUs, with their strengths in providing personalized service to individual members, to grow their share of the sector. SMBs are in regular need of operating capital, and 89% of small businesses rely on loans and lines of credit to keep their doors open. During the pandemic, with SMBs in need of emergency capital, most looked to CU competitors for financial services, including 49% that went with large banks and 45% that went with small banks. Even financial services firms scooped up 23% of the SMB banking sector.

For more on these stories and other credit union developments, check out the Tracker’s News and Trends section.

Clearview Federal Credit Union on Maintaining Personalization in the Digital Age

When choosing how to prioritize digital transformation initiatives, CUs have a lot of factors to consider, yet members’ needs remain the most important. Having the latest technology is less important than knowing how that technology will improve members’ banking experience. In this month’s Feature Story, Bill Snider, vice president of digital strategy and marketing at Clearview Federal Credit Union, talks about how Clearview is leveraging digital services and tools to help members feel even more connected to their CU than ever.

PYMNTS Intelligence: Meeting the Digital Innovation Demands of CU Members

Credit union members want digital services, from peer-to-peer (P2P) and contactless payments to digital account management tools, and if they cannot get them from their CU, they will get them from someone else. The challenge for CUs lies in applying the tools of the modern world effectively, ensuring that their offerings to members satisfy the community-driven focus and personalization CU members have come to expect and value.

This month’s PYMNTS Intelligence looks at the latest innovations available to CUs and how they can be leveraged to build on the characteristics members expect of their CU.

About the Tracker 

The “Credit Union Tracker®,” a PYMNTS and PSCU collaboration, examines the latest trends and developments shaping the credit union space and the best approaches to innovation for meeting the needs and expectations of members.