MALVERN, Penn.—The problem for many CUs? 2020 vision.
One data systems expert believes that with all the attention on how technology will support the financial services industry in 2020 and beyond, that many CUs are overlooking “legacy” issues that technology can resolve today.
Kris Frantzen, senior product manager at Temenos, said he has noticed that a lot of “futurists” are speaking at credit union meetings this year. He said he’s found these technology sessions to be informative and thought-provoking, with many directed at how credit unions can “weave their products and services into the evolving society” and capture the business of upcoming generations.
“But at the meetings it can be difficult to move from a futurist's discussion of how we'll bank in the year 2030 to a hallway chat with a C-level credit union leader struggling with three-day turnaround times on personal loan decisions or managing paper applications for new member accounts,” said Frantzen
Frantzen emphasized that while it’s important to look toward the future of banking, that the credit union has to pay just as much attention to how technology can address long-standing issues.
Reality Of Business Challenges
“There's a current reality of business challenges—for example becoming more responsive to members or eliminating manual and paper-based processes—that we need to tackle first,” he said. “The good news is that the technology solutions required to meet these business challenges, as well as those that can propel us well into the future, are available now.”
Kris Frantzen
Referring to a 2016 Magnify Money Credit Union Digital Readiness Study, Frantzen said that data supports how CUs that effectively leverage technology are growing while those lagging behind are not.
“Over the last six months credit unions with a digital adoption score of more than 75 grew their membership base by 2.63%,” said Frantzen.
That score derived from determining how many key technology services an FI offers, with the higher the score the better.
“The least digitally advanced credit unions, with score below 25, actually saw a reduction in their membership base,” he said. “This sends a clear warning to credit unions: If you want to grow and prosper, you will need to invest in digital capabilities.”
Frantzen suggested that credit unions need a technology partner that understands the credit union’s current business challenges and goals for improvement, and is also skilled in charting a course for the future that will lead to strong growth.
“It's important for us—or any technology provider with whom a credit union chooses to work—to pay close attention to the current business needs and the CU’s willingness to adopt new solutions,” said Frantzen. “Continually driving our technology forward is vital, but it must always align with the goals of those we serve in order to bring value. We call it ‘cutting-edge practicality.’”
Futurist Chatter
Frantzen said it’s time to stop sitting and listening to futurists “pontificate about the future.”
“Let's start making that future. Identify the parts of your business that will hinder your success moving forward and prepare for change in your organization,” he said. “And, find a true technology partner to accompany you on your journey into the future.”