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How Credit Unions Can Approach AI Compliantly & Ethically in 2025

Use AI to deliver innovative financial solutions while maintaining fairness, transparency and member trust.

By Brian Gunn | November 13, 2024 at 10:00 AM
Credit/AdobeStock

As credit unions plan their budgets for 2025, there is an increasing focus on innovation, and artificial intelligence is playing a pivotal role in shaping this evolution. However, while AI solutions are proving extremely successful in areas like fraud detection and risk management, customer engagement is an emerging area where credit unions must approach AI implementation with caution, ensuring compliance and ethical responsibility.Not surprisingly, AI is top of mind for many credit unions. In fact, Jack Henry’s 2024 report revealed that relative to banks, credit unions give outsized priority to investments in AI. Credit unions are also allocating more of their budgets to data analytics and automation.Moreover, American Banker‘s annual Best Credit Unions to Work For survey revealed that nearly one in five credit unions are using or plan to implement chatbots or virtual assistants. Fifteen percent said they are exploring AI-driven loan decisioning and underwriting technology.AI presents exciting opportunities for credit unions, particularly to enhance financial wellness for credit union members, but it must be approached correctly. Credit unions can offer hyper-personalized advice and automate consumer financial wellness end-to-end. Based on the rules and settings set by the credit union, AI can provide real-time advice on products such as HELOCs, credit cards and consolidation loans, improving member engagement and retention.Ultimately, AI can help credit unions live up to their long-standing reputation of being member centric. However, as they explore these possibilities, they must focus on a few key areas:

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