How Credit Unions Should Think About Improving the Member Experience

The arms race for credit unions to improve the end-user experience has expanded year after year. This revolution in consumer expectations has created new incentives and challenges for financial institutions and fintechs alike. It has almost become a given that any new financial tool or service must have a sleek, modern user interface. With large banks and fintechs offering these slick and intuitive user experiences, it should be no wonder that credit unions are also deeply concerned with improving member experiences.

According to Business Insider, 61% of banks in the U.S. regarded improving customer experience as a top priority in 2022. Meanwhile, Insider Intelligence reported that improving the member experience was a top priority for 81% of credit unions. The demand for member-experience-improving solutions is undeniably high, but are credit unions using the wrong strategy to improve their members’ user experiences?

While many credit unions may instinctively seek out member-facing technology solutions to improve their usability, there may be more effective ways to positively impact your members’ experiences. Most of the innovation regarding improvements to the member experience have gone into the front end and the user interface of web and mobile applications. However, improving the overall experience that you deliver to members goes beyond a sleek interface and requires the complement that a well-orchestrated service fulfillment back end provides. For example, those credit unions might be better served by investing in back-office automation to drive faster service delivery. Additionally, investing in data-driven processes that are highly-engaging along the duration of a process can set a credit union’s experience apart.

Consider the average member experience of applying for a loan at a credit union. The average personal loan takes about three to five days from look-to-book, according to U.S. News & World Report, while the average mortgage takes around 30 days, mortgageloan.com reported. Much of this time consists of manual processes that require credit union knowledge workers to contact applicants in order to acquire all the necessary information and documents. Also, most credit unions still use decades-old legacy systems that neither integrate nor talk to each other, which only prolongs the process. Credit union workers must manually transfer data between legacy systems that cannot communicate with each other at every step in the process. How great is the usability of a loan application that takes five minutes to complete, when you still have to jump through many hoops for the next three to five days in order to actually get the loan?

This double punch of inefficiency can leave members frustrated at best. In the worst case scenario, it can leave them shopping for rates and better service at other credit unions or financial service providers. Conversely, with modern integration and automation solutions, a credit union can cut down the lending experience from days to minutes, and without having to replace existing systems. That is transformational for any financial institution. Additionally, the added value and convenience is passed on to the member. In this way, improving the back office is a crucial step toward improving the service  that your members experience on the front end.

However, that is not to say credit unions should ignore member-facing solutions outright. Although front-end technology, like internet banking and mobile solutions, is obviously a valuable tool for financial institutions to improve their services, credit unions must not overlook the fact that if back-office solutions are not efficient, a more appealing front-end member experience will not be enough.

Continuing with the lending example mentioned previously, end-to-end process automation can further improve the lending experience. While back-end automation may sort through member data and assist with underwriting, processing and funding using artificial intelligence, end-to-end automation can deliver the right message to the right member at the right time, and gather all the necessary documents without the intervention of a credit union knowledge worker. With its broad capabilities, end-to-end automation can work between legacy systems and seamlessly transfer data across multiple systems that typically cannot communicate with each other. Under these circumstances, newer innovations like AI and cloud integration have the room they need to deliver a 24/7, always available, highly personalized banking experience.

Again, front-end technology is a step in the right direction for a credit union or other financial institution to improve its operations and member experience, but credit union leaders should be conscious that a great member experience means a holistic experience from end-to-end. Every organization is different and has unique strengths and weaknesses. Not every credit union needs the same tools or approach. Instead, credit union decision makers should consider their unique processes, teams, members and systems and implement solutions that closely fit their specific needs. Credit unions should choose tools that can orchestrate both the front-end and back-end to collectively drive engaging member experiences from beginning to end, on weekdays and weekends.

Joseariel Gomez is Founder and CEO of Shastic, a Berkeley, Calif.-based provider of a Robotic Process Automation (RPA) platform for banking.