Originally published in CUInsight.com
Raise your hand if your credit union is a leader in digital offerings. Keep that hand up if your members agree. Finally, hold it just a little longer (you didn’t expect this article to be a literal workout!) if your local community agrees.
Of course, I’m just writing on a page, so my presumption of response is just that, a guess. However, I can wager no one held their hand up the whole time. This may shock you, so grip your phone tightly, but credit unions…aren’t digital banking leaders. Then what group is?
Digital banks and fintechs. And, frankly, it’s not even close. To rub it in just a bit more, they also won the race for younger, tech-savvy generations.
According to Cornerstone Advisors research, “[m]ore Gen Zers and Millennials call a digital bank their primary checking account provider than those that consider a community bank or a credit union…combined.”
That data point bears repeating:
More people 40 and under use a digital bank for their primary checking than every credit union combined.
Maybe credit unions just need to work on their marketing. Members love dealing with the best not-for-profit financial cooperatives around! Right? Wait, right? Oh no, not here too!
Turns out, member satisfaction with credit unions is down, and has been on that path for a while, especially with Millennials and Gen Zers. Interestingly, member satisfaction levels fell for credit unions at the same amount as digital banks grew their satisfaction levels (around 2%).
In other words, people who make up the bulk of the population (and more moving forward) prefer digital banks to credit unions. The biggest reasons? Lack of satisfaction with “online banking capabilities that are easy to use” and the credit union being “easy to deal with”.
What is a humble credit union to do?
Mission
Yes, mission.
Just not the way you may think. GAC and other gatherings bring together credit union lovers to celebrate driving their mission of financial education, inclusion, and empowerment. But, given the data, that’s either not what people want, or it’s not getting across.
Otherwise, credit unions would be the dominant banking option of choice, right? Which means there’s a disconnect.
I’d bet people do want these things. It’s why they use digital banks, which make managing savings, spending, budgeting, debt elimination, and investing easy. With a bit of education, apps guide users to take positive steps with their own money.
In other words, they help more people take greater control of their financial life. Financial empowerment, you could say.
How is that not the credit union mission?
Combined with community impact, it is the mission. Which means people want it, but don’t feel they’re getting it from credit unions. Or to do so, have to deal with disappointing digital services. Something’s gotta give.
Claim Your Measured Mission Identity
So what’s missing? Obviously, first, you need quality digital options. You won’t be able to build them yourself. Partner with great providers. Ensure everyone has APIs so it all talks seamlessly and makes members and staff lives easier. I’ve covered that before.
Tech in hand, that’s not all. You still need something else. Branding and connection. Let’s achieve that in two, highly simplified, steps:
- “Measure your mission.” My CU Geek posts called for this concept numerous times, but when Anne Legg spoke the phrase in a recent chat, I had to give her the credit.
- Claim your identity. A common concept for my loyal readers, but, once again, someone else explained it more clearly than my dozen posts did. Jackie Brown of JB Collaborates suggests you “discover your individual credit union’s true identity”.
And step 3? Well that’s spreading the word, through actions made obvious in the previous two exercises. If you did them right, and continue to tweak as you go, the outreach will stem from self-appointed brand ambassadors: Your members.
After all this effort, will your credit union attract back all those people already lost to digital banking platforms? Probably not. But you will stem the tide, while building existing relationships and engaging the community, inspiring others to join.
In other words, shore up your digital offerings. Once you’re directly competitive and comparable to digital banks in people’s minds, the community focus shines through. And that’s where you excel.
Credit unions won’t make every person a member, but they can make a positive difference in more lives. And after all, isn’t that the mission?
