Master Full-Service Digital to Win With SMBs: Virtual CUBG Conference

The economic upheaval resulting from the COVID-19 pandemic may have left some credit union leaders wondering if it’s wise to serve small- and medium-sized businesses (SMBs), but now is in fact an opportune time to do so – as long as they commit to engaging with them via full-service digital tools, according to Jack Henry & Associates Senior Director of Strategy Lee Wetherington.

Wetherington, who presented Wednesday during a virtual conference hosted by the Portland, Ore.-based business services CUSO CU Business Group, explained that despite a stalling of small business revenue since June and numerous bankruptcies happening in industries such as travel, hospitality and food services, new business applications jumped between April and August and according to Cornerstone Advisors research, the pandemic exposed a $371 billion opportunity for financial institutions to provide accounting and payments services to SMBs.

And, after being forced to operate remotely during stay-at-home orders, businesses flip flopped their share of investments from physical investments to digital investments in the second quarter of the year, according to the U.S. Bureau of Economic Analysis and investment management firm Alger. In seeking all-digital banking services, many businesses turned to players such as Kabbage, Square and PayPal, all of which may offer the technical functionality businesses need but lack one key component – personalized service.

Businesses want to be able to “easily connect with a person,” something that offers a huge opportunity for credit unions, Wetherington said, noting that credit unions must also be available to connect with them “at the moment they need you.” With about 30% of consumers banking digitally for the first time during the pandemic, their comfort level with the technology is all over the map, meaning credit unions must pair robust digital banking services with on-demand human or human-equivalent assistance, he emphasized.

In implementing a full-service digital platform and measure its success, Wetherington recommended focusing on reducing the amount of time that lapses between the moment of a member’s need and reaching a resolution for that need. As an example of a tool that’s right in line with full-service digital, he displayed an image of a chat function (left) that allows members to securely message the credit union and upload transaction files for reference.

Credit unions should also consider full-service digital as an opportunity to cross-sell, he said, by offering products and services that might meet members’ needs after a resolution has been reached. Opportunity especially exists in lending, with SMBs intending to borrow around $2 million over the next two years, according to Cornerstone Advisors.

“All of this gets your digital channel from being a self-service call center to being a full-service, revenue-generating mechanism that is in line with your ethos of people helping people,” he said.

CU Business Group’s virtual conference runs through Thursday. The CUSO organized the virtual conference after cancelling its two in-person 2020 conferences, originally scheduled to take place Portland and Memphis, Tenn., due to the pandemic.