RANCHO CUCAMONGA, Calif. – A new report suggests that in 2021 consumers asked for digital engagement, and now in 2022, fintechs are making it happen.
The report from Co-op Solutions calls the findings a “provoking reality” among several others explored in a joint research project commissioned by Co-op Solutions in partnership with EY (formerly Ernst & Young) and Filene Research Institute.
“The proprietary research looked at changes to consumers’ financial behaviors and their preferences and activities, as well as the challenges faced by credit union leaders over the past year,” Co-op Solutions said. “The conclusions highlight an opportunity to meet member needs and ignite credit union growth through daily interactions, including payments.”
The research results are included in the new white paper from Co-op titled, “Co-op CU Growth Outlook: Bridging Member Needs and Payments Strategies to Deepen Trust.”
Confirmation for CUs
“The research confirms that credit unions can address members’ evolving expectations, meet the increased competition from fintechs and be truly member-centric by supporting their members in their daily activities, interacting with them at multiple points each day,” Co-op said.
Co-op said the research shows the best way to activate daily engagement is by offering digital payment options, while creating financial transparency and helping members take control of their own financial lives.
“We now know that robust and relevant digital payments options are objectively the best way to activate daily engagement,” said Samantha Paxson, chief experience officer for Co-op. “Layering financial transparency and member control on top of those digital payments tools is how credit unions will maintain the trust and, ultimately, the business of modern members.”
Step One
According to Co-op Solutions, the CU Growth Outlook white paper outlines six steps for activating daily engagement to win the business of more members. The first among them is to incorporate digital payment options, such as virtual wallets, contactless payments, P2P channels and POS purchasing integrations, like buy-now-pay-later solutions.
“The availability of tools like these is crucial to earning and maintaining member trust, a must-have in today’s highly competitive financial services environment,” Co-op Solutions said.
According to the research, Co-op Solutions reported credit unions are falling behind in the race for trust. For example, the company said, EY’s survey of 2,000 credit union members and 1,000 prospective members revealed that consumers don’t trust credit unions to offer the digital payment solutions they want.
According to Co-op, the sentiment proves out in the numbers: 66% of respondents use some form of digital payments, yet only 16% do so directly with their credit union.
“Capturing member trust is about so much more than profitability,” said Paxson. “The competitors out there offering digital payments rarely have the financial wellness of their users in mind. Member-centricity comes down to meeting members where they are so we can get them where they’re going – faster, safer and in a more holistically healthy way. Fintechs, big banks and data-ravenous tech giants are not the answer; but members seek them out when they can’t get what they need from their credit union.”
Additional Findings
According to Co-op Solutions, other findings explored in the research paper include:
- 34% of respondents report looking outside their current financial relationships for products that meet their needs.
- 41% of respondents would consider leaving a credit union because their products do not meet their current needs.
- Whereas credit unions are No. 1 in passive member relationships, fintechs have achieved the top slot in active relationships.
- Credit unions are confronted with multiple pressure points, including earnings, member experience issues and expenses, making it difficult to commit to a digital ecosystem.
- Yet, if credit unions invest in lifestyle banking product offerings, like digital payments, they can gain significant market share of both members (+16%) and prospects (+13%).
The full report, “Co-op CU Growth Outlook: Bridging Member Needs and Payments Strategies to Deepen Trust,” can be found at coop.org.
Has Everyone But You Heard the News?
Don’t forget to check your Spam/Junk email folder if you haven’t been receiving your free, popular and daily CUToday.info news headlines.
And if you haven’t yet signed up for the new email solution on which CUToday.info has partnered with ResponseGenius, you can do so here. Signing up requires less than one minute of your time.
CUToday.info has received very positive response from readers following the move to an improved provider of the daily headlines, but many also noted they did need to go to their Spam/Junk folder and mark it as safe.
The new email solution has not only improved every reader’s delivery experience, but it also features a fresh, new format that is easy to read, especially on mobile devices.
Please note and/or make your IT department or email administrator aware the emails will be coming from the domains CUTodayinfo.com and CUTodayinfoReply.com.