WASHINGTON–A new analysis suggests a link has been identified between technology adoption and growth at credit unions with less than $50 million in total assets.
Tech-savvy credit unions are identified as credit unions that offer mobile banking, remote deposit capture, online new member application, online loan application, and online share account application as of the first quarter 2016, according to Callahan & Associates, which performed the analysis.
Not only did credit unions with strong technology offerings grow assets, loans, shares, and members at a faster pace, they are more efficient than their peers with an efficiency ratio of 88.71% compared to 89.41% at credit unions less than $50 million in assets with a less robust technology stack, according to Callahan’s.
“When it comes to financial transactions, consumers want enhanced services that are easy to use,” said Sam Taft, Callahan director of industry analysis, in a statement. “Credit unions that can meet this expectation have the potential to build strong member relationships that can translate into improved financial performance across a range of measures.”
Callahan’s reported that credit unions in that asset class with a strong technology offering have an average member relationship of $10,576 and are experiencing positive member growth annually, compared to an average member relationship of $9,708 and annual member growth of -1.0% at similarly sized credit unions that offer less technology to their members. These credit unions are also projected to grow at a faster rate across the next five years, Callahan said.