Combining a modern and open technology stack with credit union’s signature personal service has positioned the industry to better compete and grow. In fact, credit union membership grew by 2.4% in 2024, adding 3.3 million new members.

Pulusani: Credit unions made significant technological strides in 2024 aimed at transforming digital banking and member experiences. Key advancements include:

• AI-powered personalization: Tailored financial advice, predictive spending insights and product recommendations using machine learning and AI to create more personalized member experiences.
• Enhanced cybersecurity: Sophisticated threat detection, behavioral biometrics and advanced encryption.
• Open banking APIs: Integrated financial services with fintech partners for comprehensive financial management.
• Comprehensive mobile banking: Real-time tracking, instant loan applications and financial wellness tools.
• Predictive analytics for credit risk: Advanced risk assessment for nuanced and fair lending decisions.

Embedded finance has emerged as a game-changer, allowing credit unions to seamlessly integrate their services into everyday shopping experiences. Through partnerships with local businesses, they can now offer real-time financing for big-ticket items – such as cars and furniture – both online and in-store. This approach meets consumers at their point of need, modernizing member engagement while reinforcing the community-focused values that set credit unions apart.

That said, unlocking the full potential of these advancements requires credit unions to embrace change. Challenges like educating merchants and consumers about the benefits of embedded finance must be addressed. By committing to data-driven strategies and innovative technologies, credit unions can not only attract a new generation of members but also ensure sustained growth and a deeper impact on the communities they serve.

What will be credit unions' biggest priorities heading into 2025 in the areas of fintech partnerships, AI and/or other areas of business related to technology?

Geis: Credit unions will prioritize new technologies that enhance member experiences while maintaining a personal touch. AI-based solutions present the potential for major breakthroughs, but real-time fraud detection, loan funding and other efficiencies are difficult to achieve without a fuller complement of financial data. The most successful financial institutions will be proactive in securing permissions to aggregate more of their account holders’ financial data back to the institution using open-banking rails. More data, less fraud. More data, better service. More data, higher margins. 2025 will be the year that many institutions get serious and smart about data strategy, plugging data deficits on both existing accountholders and prospects.

Credit unions aim to use AI, advanced analytics and strategic technology partnerships to better understand and serve their members’ evolving financial needs while maintaining robust security and compliance standards. With AI and machine learning, they will power personalized member experiences, fraud prevention and automated processes. Credit unions will continue to invest in digital channels, such as mobile banking, online banking and digital wallets, offering more convenience and flexibility to meet the evolving needs of their members.

Strategic partnerships with fintech companies will be forged to access innovative technologies and solutions without significant upfront investments. Adopting an API-first approach will enable seamless integration with fintech solutions and facilitate the development of new products and services.

These priorities reflect a holistic approach to technology – not just as a set of tools, but as a strategic enabler of more responsive, efficient and personalized financial services.

Kirby: As credit unions begin 2025, their top priorities will center on addressing pressing challenges like rising loan demand and the ongoing deposit crisis through data-driven and technology-focused strategies. Delivering personalized, firm-rate financing options tailored to individual risk profiles will be essential for meeting member needs responsibly and maintaining financial stability.

Embedded finance is set to remain a cornerstone of innovation, enabling credit unions to integrate their services directly into both local and digital shopping journeys. By partnering with merchants, credit unions can offer healthier, more competitive financing options that elevate the consumer experience and strengthen community ties.

Anticipated regulatory changes and the need to attract younger, digitally savvy members will also shape credit unions’ strategic focus. To remain competitive, credit unions must embrace technologies that create seamless, consumer-first experiences – whether through embedded lending at local businesses, e-commerce partnerships or AI-driven personalization. By modernizing their digital capabilities and staying true to their community-first values, credit unions can sustain growth, deepen their impact and secure their relevance in an evolving financial landscape.