This is how credit unions compete and thrive in the new world of digital banking

Cheerful young black woman using her credit union credit card at home

The pandemic has transformed how consumers interact with their bank or credit union, accelerating the adoption of digital tools. And it’s no secret that established institutions face increased competition from fintechs and non-financial services platforms.

Meet your customers where they are

A recent Fortune article estimated that nearly 90% of U.S. consumers now use a fintech app to manage their financial lives. Consumers now expect the same digital experience from their financial institution as they do in their eCommerce transactional experience. A BAI report on top banking trends and challenges in 2022 mentioned that 47% of consumers would switch financial service organizations for a better mobile app or digital experience.

What this all means is that credit unions and other financial services providers need to find new ways to drive value as they service members though digital engagement.

Now that digital is the preferred touchpoint for consumers, forward-looking banks and credit unions need to have a digital first mindset. The days of going into a branch to conduct your financial business are numbered, if not already eliminated.

Leverage your strengths for better insights

As Axway’s Head of Open Banking Eyal Sivan points out, we are at a transformational moment: “People still trust and need their banks, but these new fintechs are offering amazing tools that people really want to use.”

The good news is traditional financial institutions still benefit from a major advantage: trust. A recent study found those who bank with traditional brick-and-mortar institutions or credit unions generally have more faith in their financial institution than those who primarily use an online-only bank.

So how do credit unions retain that trust as members are lured by shiny new offerings? Financial institutions are sitting on a wealth of data, including customers’ products, preferences, and histories. Now, they need to have a 360-degree view of their customers to understand for example if there’s an opportunity to cross sell additional financial products and services in a digital environment.

The trusted advisor role of the financial institution should not be squandered but used to retain and cultivate new members.

Without a face-to-face interaction, FIs need to rely on technology indicators. The challenge is how to work with their existing core systems to extract the relevant customer intel.

Personalize products and experiences

One way to increase share-of-wallet is by connecting existing account holders with compelling, personalized recommendations. This often requires combining information from multiple data silos and legacy applications.

Recently, Axway was able to help one of its customers, a credit union, enhance member retention by offering customers personalized product and service recommendations, thereby driving business growth.

With the help of Axway’s Amplify API management platform, the credit union was able to create a single data repository for customer preferences and historical interactions. This gave customer service teams a very comprehensive view of the member, empowering them to better understand each customer and build more compelling digital interactions.

Credit unions don’t need to fear competition from fintechs and the online-only banks of our age. They can draw from their historic strengths, embrace and securely integrate new services, and see the opportunity in digital banking.

Let us help you imagine new ways to grow your organization’s capabilities, gain a competitive edge, and deliver superior customer experiences.

Learn more about how one U.S. Credit Union built a 360-degree customer view from the data it already had to offer compelling product recommendations.

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Financial Services Industry Marketing Director at Axway,  Karen is the Product and Solutions Marketing Director for financial services at Axway. Her role is driving the go-to-market strategy for Axway solutions in banking, insurance, and capital markets by defining marketing programs and providing industry solution positioning.

 

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