How Cyberattacks Affect Member Confidence & the Reputation of Credit Unions

To mitigate against the impact of an attack, plan to protect your two biggest assets: Your members and your CU’s reputation.

While members hold your credit union to high standards, they also understand that cyberattacks are a threat. But if your credit union is hit by one, have you considered what it could do to your reputation?

A first-of-its-kind study released during Cybersecurity Awareness Month in October examined the effects of cyberattacks on corporate reputation and consumer confidence. The study, conducted in September 2019, surveyed 562 adults in Oregon. Key results, released from ReputationUs (RepUs), a firm specializing in reputation management and cybersecurity preparations, and DHM Research are highlighted in the chart above.

First, the alarming news: The vast majority of survey participants – 73% – indicated that they have had their personal information compromised. But the good news is that consumers have the upmost confidence in the ability of credit unions and banks to protect their private information. A noteworthy 84% of respondents put these types of financial institutions at the top of their consumer confidence for all industries surveyed.

Compare this with 64% consumer confidence in credit card companies, for example. Mobile phone providers came in lowest, with just 48% of consumers having confidence in these companies to protect their personal information.

High consumer confidence when it comes to protecting financial data may mean, however, that a credit union hit by a cyberattack has further to fall. If a cyberattack is mishandled, credit unions, among other industries, potentially face a significant loss of customers or members. In all cases, less than 48% of customers would be willing to remain with an organization if their compromised financial information was used in some way.

Cybersecurity Preparations

What can you do as a credit union do to protect your reputation in the event of a cyberattack?

The key to mitigate against the impact of an attack is proper planning for your two biggest assets: Your members and the reputation of your credit union.

1. Protecting Your Members. The study substantiates the importance of communications, transparency and proactively offering customer credit monitoring during and after a cyberattack. In fact, 96% of consumers believe companies should publicly acknowledge an attack occurred and offer free credit monitoring for one year, even if there is no evidence that information was stolen.

2. Support Your Credit Union. It is important to consistently manage your credit union’s reputation, to make it easier to secure your reputation in the event of a cyberattack. Consider these three aspects of reputation management:

  • Enhance: Have a reputation audit done throughout your organization for a thorough analysis of your credit union’s overall reputation, including strengths, vulnerabilities and opportunities. Be sure to include how it would respond to a cyberattack.
  • Protect: Put a reputation plan in place that connects to your member relations, media partnerships, social media, influencer engagement, executive training, content development and internal communications.
  • Defend: Plan before, during and after a cyber incident occurs to help mitigate against further damage.

Crisis management is 99% preparation and 1% execution. Are you prepared?

Casey Boggs

Casey Boggs is President of ReputationUs. He can be reached at 503-946-8344 or cboggs@reputationus.com.

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