New Digitization Report Looks at Challenges, Opportunities for CUs
The first report released by the CU System Digitization Working Group gives an industry outlook.
There are positives and negatives when it comes to how credit unions have adjusted to the digital landscape and members’ digital needs, especially since the pandemic began in early 2020. Some of these positives and negatives were laid out in the first report filed by the new Credit Union System Digitization Working Group on Monday.
The group, led by CUNA and made up of 41 credit union leaders from around the country, has met three times since April and submitted its first report this week. The report stated, “COVID-19 has accelerated the adoption of digital technologies in the financial services industry, leading to a focus on contactless payment and reduced dependency on brick-and-mortar institutions. While some banks and credit unions are already adopting new technologies, fintech companies are setting a high bar for consumer expectations.”
The group stated that it will collaborate to find the “strategic imperatives, gaps and opportunities for credit unions to remain relevant and thrive by providing premier digital services to their members.” The group said it believes this system of collaboration will help foster “widespread access to – and adoption of – new and existing digital solutions, which will help drive member satisfaction.”
According to the group’s outlook on the industry, there is not a one-size-fits-all approach to digital transformation, and digital innovation appears to be limited by the complex regulatory environment. To that end, according to the group’s report, “Credit unions are trailing banks in member satisfaction surveys, likely a result of the digital capabilities that banks offer.”
The report pointed out, on the positive side, that the NCUA is moving toward a digital future by recruiting new talent with a background in fintech. The report added that collaboration could be key to the digital success credit unions find in the future. “Digitally advanced credit unions can share best practices to help create an industry-wide standard and provide widespread awareness of essential member-facing technologies,” the report stated.
According to a statement from CUNA, the working group has divided itself into five workstreams or discussion groups to identify problems. They include the following:
- The Analytics and Intelligence workstream will assess how credit unions can leverage analytics tools to help their members track and achieve their financial goals.
- The Empower Employees workstream will examine how credit unions can use technology to compete, stay relevant and attract new talent.
- The Member Relationships workstream will be responsible for identifying digital solutions that would simplify the member experience.
- The Optimize Operations workstream will explore the barriers credit unions face when implementing new technology into their systems.
- The Transform Products workstream will be responsible for identifying fintech partnership opportunities that can help credit unions reach a new generation of members.
CUNA said the CU System Digitization Group evolved from the former CUNA COVID-19 Restart and Recovery Task Force, which met eight times last year to discuss the challenges arising for credit unions due to the pandemic.