Credit Unions Can Be the Online ‘Influencers’ Guiding Younger Consumers to Financial Wellness

PSCU Chief Growth Officer Brian Scott told PYMNTS that younger generations are more challenged than their older peers.

“They just have not had the same amount of time to create a savings ‘pool’ or even to create good financial habits, so they struggle more than other groups during a challenging economic situation,” he said.

Credit unions (CUs) are well-positioned to help these younger consumers improve their financial health, he said.

“Creating programs that are specifically designed for financial education for younger consumers is one area that I think credit unions can really excel at and should be excelling at in this case,” he said.

But to get there, CUs must ensure they meet Generation Z consumers and millennials across all the channels they favor — and especially across digital channels. The credit unions that get it right, that offer tailored, personalized financial wellness programs for those digitally savvy consumers, will be rewarded with loyalty, and many of these individuals will embrace these forward-thinking CUs as their primary financial services providers.

Data underpins any tailoring of any outreach and educational efforts. Scott noted that financial institutions (FIs) — especially with permissioned data — can help a CU gain insight into how millennial consumers might be managing their finances, how they might use debit transactions versus credit and how their spending and savings habits are evolving.

Where They’re Challenged

Right now, he noted, many younger CU members are struggling with credit — specifically, juggling and satisfying the monthly obligations that come with traditional credit card payments or buy now, pay later (BNPL) plans. Many consumers may be inadvertently embracing several BNPL loans at once, only to find that the weekly/biweekly payment obligations are onerous.

To be proactive, to bring consumers along on a financial journey that is beneficial to the individual (and also the FI), he said, credit unions must strive for a state of what he termed “perpetual innovation.” Social media platforms such as TikTok and Instagram are fruitful areas to connect with younger cohorts.

And, eventually, CUs can bring them into brick-and-mortar settings, when that may be the most effective point of engagement. Scott noted that not all financial services can be best rendered in-app, and some interactions might need a human touch at some point along the way.

Credit unions have a key advantage over other providers to segue from the digital channels into the branch environment and deepen the relationship. Relatable and engaging content in the digital channel may open the door to a one-to-one real person at the CU, who will in turn be the person who is behind the desk in the branch, he said.

“This gets back to people helping people,” said Scott. “You can’t be two different credit unions — one that’s digital and the other in person.”

The unified experience tracked across all channels, he said, requires training of the CU’s staff and a continued refinement of that training. In addition, credit unions have a visible role in the community — and are socially conscious — so they have an opportunity to attract socially conscious, younger members.

“It’s important that credit unions share what their mission is, as younger consumers are focused on giving back,” he said. “They are making decisions [about doing business] with companies that are socially conscious.”

And against that backdrop, he said, “there’s a role for credit unions to play as influencers in financial services and financial wellness in particular. That’s something the credit unions should grasp onto — and own it.”