Credit unions face an existential need to track movement on long-term deposits and develop strategies to attract and retain younger members. Now is the time for credit unions to differentiate themselves by ensuring they can deliver the right technology, create opportunities to connect and offer unique value to members.
And even if many credit unions are not at technology deficits compared to big banks, they are at a perceived deficit. Effectively communicating capabilities to key target audiences should be a priority.
Partnering with fintechs can help credit unions introduce new digital services to members, such as budgeting, credit score and educational tools. These partnerships can also help to engage the next generation of consumers. For example, credit unions can offer a co-branded fintech platform to kids and families, delivering a custom debit card, wealth management options and financial education tools by integrating with Fiserv partner Goalsetter.
Credit unions that can establish their commitment to financial wellness and financial health – and how members benefit – can build trust where they operate. For example, we work with one mid-sized credit union that takes every opportunity (outdoor signage, community events, local advertising) to publicize their give-back to members: “Members who refinanced with us saved $X million.” They’ve quantified the concept of “When we do well, you do well” and put it in terms of value to their members.
Educating for a financial future
Credit unions agree that helping members live a healthy financial life is primary to their mission and a big part of what they do on a day-to-day basis. See it in action.
Intensifying focus on relevant branch strategy
Revisiting the role of the branch is not new for credit unions, but the scale and scope of the current transformation is new. Credit unions are moving away from the notion of branches being transaction hubs and transforming them into centers of sales, service and advice. This affects everything about the branch – from the people who staff it and the location to the technology that is offered.
Major banks have significantly reduced branch counts over the last five years (2016–2021) in an effort to gain efficiencies and focus more on virtual experiences. In contrast, credit unions have grown their overall branch count by 1% and the largest credit unions have increased branch count by 13% over the same time period, according to data from the FDIC and NCUA.
As credit unions look toward branch growth, they are figuring out the optimal locations, experiences, and talent and skills that will be needed to make each branch succeed.
We expect to see more mobile branches, especially in rural areas where it might be impractical to have a continual physical presence. Credit unions are also focusing on micro branches – typically smaller branches located in malls or supermarkets – with more limited staff and targeted services. In other cases, credit unions are looking to balance the presence of traditional teller-staffed branches with newer, more digitally focused experiences.