I last opined on the difficult marriage between credit unions and fintechs and concluded that it often leads to divorce because of very different motivators — hyper growth for-profit venture companies versus a conservative not-for-profit industry. Today I want to discuss how our industry can adopt the skills that will make us more appealing to our entrepreneurial friends in fintech.

The fintech world wants to partner with the credit union industry. While they may not always understand how we work, our $1.3 trillion assets and 108 million members stands out as a huge untapped opportunity for their products and services. They want to date us and they are very appealing to our industry because they have built new markets and services that our members are demanding. Every day they are finding new ways to attack the banking market, including through marketplace lending in the mortgage, business, student and consumer loan product realm; blockchain and alternative payment options.

There are now more than 6,000 fintech services available to consumers, including products like Venmo and Square in person to person (P2P) payments. These payment transactions were once flowing through checking accounts and creating income via debit transactions, but that is no longer.  The small and medium business services product line is being attacked by the superior technology, speed and experience offered by OnDeck and Kabbage. These products are the foundational business of many community banks and a growing product line for community credit unions. Now many small businesses go online for a loan versus calling their banker. In addition, somewhere between one-quarter and one-third of all personal loans, representing billions of dollars, are funded by Prosper and Lending Club, and these loans were once the forte of credit unions. Student loans are now moving to platforms like SOFI, where they are refinancing billions of dollars in student loans with better predictive models. Every product that the credit union industry offers now has a brand-new competitor from the fintech world and what is even more concerning is these products appeal directly to a younger demographic that is so important to our movement's future.