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It is not difficult to see the fundamental impact digital banking and artificial intelligence has had on the very essence of the financial services industry, much less the credit union movement itself. 

Nearly every financial institution and industry has been affected by this cultural and technological deviation from the pre-pandemic norm. This evolution is particularly evident for credit unions, which have always been known and recognized for their focus on exceptional in-person member relationships and engagement.

This “digital transformation” as we like to call it now has not only changed the consumer’s need for enhanced technological banking innovations, but the expectations their given financial institution will be integrating into them. According to a recent Experian Global Insights Report published in late 2021, consumers reported they are 25 percent more likely to be online than just a year ago. That means efficient, easy-to-use, and speedy processes are now the expectation for consumers. Unfortunately, such transformations are counted as a negative for credit unions, as they have a reputation — legitimate or not — for more limited technology budgets than other financial institutions.

In order to prosper in a new world geared towards digital inclusion, a credit union must understand where their cooperative finds itself in its digital transformation journey. Internal audits must be conducted while investments in cost-effective platforms need to be implemented in order to adapt to a changing market, in addition to maintaining member requirements and demands. By implementing the necessary financial technology assets and digital automation to improve your members’ financial health goals, your credit union will have the capacity to improve risk management and offer a superior member experience.

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Find what’s best for your credit union and membership

The financial services landscape is so different and multifaceted than ever before, and consumers don’t have to be as loyal as they once were. According to BAI in 2019, when asked to rank which organizations they trusted most to handle their financial products and services, 83 percent of consumers overwhelmingly cited their primary financial institution or credit union. That percentage dropped off a cliff just one year later, coming in at only 52 percent. The same Experian report in September 2021 found only 61 percent of consumers said they’re loyal to the businesses they frequented prior to the COVID-19 pandemic, a loss of 6 percentage points since 2020.

So how do credit unions consider those  findings and put them into action? As the digital banking era continues to evolve and change, credit unions must evolve with them. First, however, an organizational review is advised in order to understand what aspects of the cooperative is working, what can be optimized, and what financial tools and fintech are necessary in order to remain competitive, attract prospective members, and let existing members know you’re consistently looking out for their best financial interests. If your cooperative doesn’t have the expertise for internal audits, outside auditors are always available to offer an evaluation on ways to find the investments that are best for your credit union. 

In this digital-everything culture, an important final result of an audit is to clearly understand whether your credit union’s existing technology is offering a fluid and smooth member experience. Those results represent a strong barometer of your credit union’s future growth, because your membership’s loyalty is a central factor to the credit union experience. 

Enhancing the mobile and digital member experience

According to a consumer survey by commerce automation platform Linnworks in early 2021, 76 percent of respondents claimed convenience as the top priority when it comes to online shopping. The previously mentioned Experian survey showed consumers ranked security as the primary need (74 percent), while privacy (78 percent) and convenience (74 percent) followed closely behind. Members are clearly telling us that safety and ease-of-use remain top of mind for their financial institution’s digital resources. 

Relational-underwriting and fraud prevention take into account some of the barriers credit unions are looking to solve, like the always-nagging manual processing of small dollar loans and other resource constraints. By infusing such fintech solutions, credit unions can offer a seamless, struggle-free, and smooth experience for members looking for a digital banking program that can quickly deliver substantial volume for an array of needs. All the while, the credit union will be building a dependable foundation of loyalty and trust. 

Fast and efficient fintech platforms like QCash’s Life Event Loan solutions have the opportunity to help credit unions stay competitive by supplying real-time, on-the-go small dollar credit decisioning that channels the power of data to inform a better, more detailed 360-degree score that tells a more complete member story. On the other side, credit unions are benefitting from a more robust small dollar lending experience. Credit unions are experiencing a 26 percent increase in booking rates right after integrating these real-time, SaaS-based relational-decisioning platforms. 

The credit union small dollar lending ecosystem is markedly different than even the pre-pandemic movement we were used to, and chances are it won’t look the same a year or two from now. Joining with an integrated platform like QCash can offer data-informed insights that can empower your credit union to prepare for future growth. As our nation continues to recover from the last two years, your credit union’s digital banking innovations can only benefit your membership experience goals.