The Biggest Credit Union Mobile Stories of 2019

For many credit union leaders, 2019 may seem like the year the entire world shrank to the size of a smartphone. After all, many more credit union members were interacting with credit unions primarily through mobile apps this year. Mobile platforms gained more power as make-or-break channels for attracting and retaining members, and smartphones as a whole continued to command more of everyone’s daily lives.

In turn, those mobile devices, though small, sparked big discussions in 2019 among credit union leaders. Here’s what two industry professionals said credit unions were talking about most.

The Smartphone-Shaped Branch

In 2019, members were increasingly more concerned about the quality of their credit unions’ apps than about the quality of their branches. According to a survey this year by payments company Marqeta, for example, 62% of Americans said they did most of their banking online, 69% said they expected to use their mobile banking apps regularly in the next three months and 67% said it wouldn’t inconvenience them if their financial institutions closed all of their branches tomorrow.

That fundamental shift toward mobile use prompted many credit unions to talk about more modern definitions of member service this year, according to John-Ashley Paul, president/CEO of the Livermore, Calif.-based Cubus Solutions, which develops online banking technology for credit unions.

“In 2019, I think the emphasis has been trying to make the mobile platform the de facto channel for member users. And that’s been reflected in a customer asking us to do more things on mobile – new apps,” he said. More credit union clients are adopting a mobile-first mind-set, and that’s shifted how they manage their members’ online experiences, he added. One result is that how things look and work on mobile devices is now a more important topic of discussion.

“All our designers, when they design a screen for any new application module, obviously it’s responsive, but the first cut of the design … everything design-wise is done with the mobile-first mindset.”

Bets On Biometric

Members’ increasing demand for speedy logins and fast transactions also put biometrics on the discussion agenda for many credit unions in 2019. Of course, fraud worries have long been a hot topic for credit unions, but mobile biometric payments are nonetheless projected to surpass $1.67 trillion per year by 2023, according to biometrics research and consulting firm Goode Intelligence. And in many cases, Paul noted, credit unions are finding themselves operating in a hardware ecosystem that’s already wired for biometrics.

“I’m seeing more people ditch their username and password,” he said. “Because you have both of the options: Everybody asks you, ‘Would you like to use face ID?’ With Face ID being so prevalent and commonplace on the Apple platform, you see adoption of that a lot more.”

Small-Screen Simplification

Many credit unions were also talking about how to reorient traditionally paper-based processes toward mobile users in 2019. That included talking about ways to squeeze things such as disclosures, instructions and communications onto small screens.

“People are used to bite-size information,” Paul explained. “Give them two screens full of information; that should be sufficient. Because right there, right then, they’re consuming it in a hurry. If they want more, give them a way to download the file to their phone so they can read it at their own time, at their own convenience. I tell customers … don’t put everything as is. Just because it was there and we can make it responsive, don’t just dump it on a different device – the same information.”

Mobile design is increasingly an expression of member service. According to survey data out earlier this year from research firm J.D. Power, member satisfaction scores for mobile banking apps fell as the complexity of the apps’ features increased. The study measured satisfaction with apps’ ease of navigation, appearance, clarity of information, range of services and availability of key information.

“Five functions, the 20 menus – they get so buried in that product they lose track of where they were and why they were there,” Paul said.

Racing to Stay Current

Many credit unions voiced concerns in 2019 about their ability to keep pace with technology, identify relevant features and do it all at a reasonable price.

“It’s just a struggle to keep up, generally speaking, especially on the mid to low end of the credit union market, the smaller end of the credit union market, and it’s becoming more and more apparent in terms of the technology offerings,” explained Mike Wallace, COO of the Livonia, Mich.-based LifeStep Solutions, which is part of the CUSO CU Solutions Group. “So it will be interesting to see how that plays out over time. I think this year really highlighted the growth of some of the neobanks or the challenger banks like Chime and some other ones. And they place, obviously, a very heavy emphasis on technology. And so it’s becoming more and more front and center, and that’s something credit unions will or have struggled with.”

Similarly, many credit unions were also talking about fintech’s role as both a competitor and a crucial integration opportunity in 2019.

“Credit unions are definitely seeing the need for these mobile features, and they’re starting to embrace partnerships with some of the fintech partners and looking, realizing that they can’t build everything themselves in-house because of budget constraints,” he said.

Many have become more open to partnering with fintechs in order to roll out certain features faster, he added. But because of the uncertainty around the ever-evolving technology space, projections and budgeting are still tough discussions for many credit unions.

“So, starting in 2019 and then moving forward, I think we’ll continue to see to see more flexibility in allowing the credit unions to be able to bring in some of these features and connect to the core. Well, of course, one of the big hesitations, and rightfully so, is around security and data validity,” he said. “Of course, we don’t want to move too quickly. Because if you move fast and break things in the banking industry, you can end up with a lot of unhappy people.”