Strategic Fintech Partnerships Can Make or Break Your Digital Strategy Plan

With rapidly changing advancements in technology, credit unions are becoming more empowered every day to make huge strides toward developing a seamless digital strategy. As member demands evolve and younger generations begin seeking financial support, it’s no surprise that credit unions across the nation are increasingly seeking partnerships with tech vendors. In fact, 88% of credit union and bank executives increased their spending on technology in 2019, according to a recent survey from Cornerstone Advisors.

However, without the correct vendor, credit unions can find themselves taking steps in the wrong direction. It’s important for credit unions to consider the different characteristics to look for when selecting a tech vendor and understand how a true partnership, beyond implementation, will benefit both organizations involved. To ensure a credit union continues moving forward to achieve digital transformation, a strategic fintech partnership is crucial.

Digital Transformation Is Here to Stay

The financial services industry has undergone a lot of change over the past few years with no slowdown in sight. In this new era of financial services, providers are racing to fulfill consumers’ expectations while still competing with one another. From offering digital platforms and intuitive websites to improving the user experience, the importance surrounding member engagement has intensified. The way a credit union engages with members will ultimately determine its success in attracting and retaining members.

A digital strategy is an integral tool to achieving superior member engagement, and teaming with fintechs must be calculated and well thought out as these partnerships have the power to make or break a credit union’s path to digital transformation. By investing in solutions that propel a technological transformation, credit unions can deliver an elevated member experience – setting the scene for success.

What Matters Most in a Vendor

Searching for the right fintech partner can be an exciting time that opens a world of possibilities, with many credit unions often sifting through handfuls of vendors and weighing the options. Fintechs are good at enticing credit unions to partner up with their seductive technology, but it’s imperative to choose a partner that will stick around for the entirety of the relationship.

Mastering software requires training and troubleshooting, so it’s important to consider a vendor’s ability to provide strong, ongoing support. A vendor that offers guidance during implementation is helpful, but a fintech that is committed to supporting a credit union throughout the ups and downs of the partnership is best. The client support team is just as vital, if not more so, than a product’s actual functionality.

Fintechs have a propensity to provide speed and convenience, but sometimes lack an understanding of how credit unions must operate, such as abiding by multiple regulations and mitigating risks. The best fintech partners can work with the credit union to navigate these challenges, identifying how technology can be most effective and increasing efficiencies along the way. Vetting vendors to find a partner that understands internal operations is key to a successful relationship.

Inevitably, issues will arise when transforming your digital strategy. A fintech partner shouldn’t be there just to resolve the problem, but instead provide continuous recommendations to leverage the technology more effectively. This includes offering analytics and status reports to identify areas of improvement, establishing recurring meetings to discuss what is working and what is not, and sharing methods to get the most out of the technology. Constantly improving the benefits of the relationship should be top of mind for both the vendor and the credit union.

It’s About the Journey, Not the Destination

Credit unions can sense whether a potential partner has its best interests at heart, and ongoing client care and support requires more than just helping a credit union leverage a product or service. Rather than a buyer and seller relationship, credit unions must work with fintechs in the form of a true partnership with aligned interests and desired outcomes. A vendor that focuses on its own ideas of success instead of the credit union’s will create tension and disappointment down the line.

In a strategic partnership, the credit union needs a vendor that joins it as a fellow voyager on a journey, not one that is simply concerned with the destination. Continuous, open communication between the credit union and its technology partner leads to advancements within the platform itself, benefitting both parties involved. While still being a third party, a technology vendor should act more like an extension of the credit union’s team, constantly contributing to improve operations. This collaboration between the two enhances the system throughout the entire partnership.

Working with an inadequate vendor can hinder a credit union’s success, especially when relying on fintechs for specialized services and technology to improve the overall quality of the institution. When choosing a tech vendor, credit unions must assess the abilities and deliverables of each potential partner to determine the best fit and establish a true partnership, benefitting both the vendor and institution. Credit unions that partner with vendors that prioritize client support will ensure a strong and lasting partnership for years to come and supercharge their digital strategy.

Whitney Loe is Director of Business Development for Credit Unions for Ignite Sales, Inc., a customer engagement technology provider based in Dallas, Texas.