Saddled with technology debt from legacy systems, credit unions have been challenged to keep pace with fast-changing retail banking digital innovation, says Ent Credit Union’s Tanan Miles, who also explains why the need for A/B testing and agile alternatives has never been more important.
Members expect all elements of their credit unions (CUs) to be seamless and personalized, including payments tools and processes for financial data access and money management. Ent Credit Union is delivering on this promise by swapping out legacy technology infrastructure and product management frameworks with agile, cutting-edge successors.
“Ent’s current banking platform was adopted 12 years ago,” said Tanan Miles, the credit union’s senior vice president of electronic banking.
He explained that system processes tend to connect inflexibly with older setups.
“We might be building something way over in this corner of Ent’s online banking universe, and we roll it out and somehow break something over here in the cellar,” he said.
To prevent these hiccups, Ent is implementing an entirely new technology infrastructure. In doing so, the CU is moving away from relying on FinTechs for the development of new features. Miles said Ent requires great agility and cannot depend on third-party partners alone when it comes to innovation.
“Customizations have ensured Ent’s digital banking services have remained relevant and members’ experiences remain smooth, but the aggregation of technical debt carries risks,” he said. “Not only do new features incur heightened development complexity and financial downsides, but looking forward, a dated platform limits our capacity to pivot quickly and turn out new features as they come to market.”
Out With the Old, in With the New
The pandemic generated acute technical challenges for Ent regarding how to deliver highly personalized digital banking experiences to its members, especially members who were financially impacted. The CU quickly began to provide digital pandemic-related solutions — from delaying loan payment deadlines to offering emergency loan applications — but still found that these critical interventions required Ent members to facilitate the next steps. That shifted as these processes have become fully digital, however.
Miles said that “one of the biggest takeaways for Ent has been to draw on our awareness that members have been trending more and more toward using digital channels and to focus on implementing a more agile digital banking architecture that positions us to release features and iterate more quickly moving forward.”
Ent invested significant resources to identify and develop digital solutions that position it to meet members’ evolving needs. The CU reevaluated its relationships with FinTechs, concluding that a vendor selling a tool to hundreds of financial institutions (FIs) could not offer as personalized an experience that Ent requires to deliver best-in-class digital banking services to its members. Ent decided it needed to dedicate resources to building features that deeply connect with its members at every stage of their digital banking experiences.
“We’re actually changing to our first cloud-based online banking platform,” Miles said, going on to reveal that Ent is aiming “to deploy a microservices architecture, providing us with the capability to release features and updates frequently, quickly and efficiently — and to iterate this process without the need to test our entire enterprise infrastructure.”
Data and Delivery
Miles emphasized that “the personalized banking journey is composed of two parts. Data is one part and then delivery. You’ve got to be able to deliver on data.”
Employing an agile digital services infrastructure introduces additional opportunities for Ent to refine the digital banking experience it delivers to its members. This includes the ability to A/B test new features. CUs prioritize balancing personalization and efficiency, and this testing provides data that can fine-tune this balance.
“A/B testing allows us to meet members needs in [the] ways that they would like these needs to be met,” Miles said, affirming that “[t]he goal of the credit union is to improve the financial quality of life for its members.”
Ent has also restructured its team to tether durable product management to members as they onboard with the CU. This more effective product management framework allows Ent to gain more insight into CU-member relationships, in turn delivering more personalized digital banking services. He cautioned that a “lot of legacy systems really hamstring you as a financial institution.”
The changing technology landscape and pandemic have introduced serious challenges for FIs. Ent has navigated these titanic shifts by focusing on replacing legacy technologies and product management systems with agile options that enhance members’ digital banking experiences, even if doing so means developing them in-house.
Miles said that if a CU thinks it cannot do this, “then they are setting themselves up at a competitive disadvantage in a digital landscape in which users demand this. … It’s been a great time to reevaluate and take action. … I’m really excited this opportunity for personalization exists.”
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