Credit Union Lending In-Branch vs Digital Lending: Comparison, Benefits, and Balance


In-Branch vs Digital Lending: Comparison, Benefits, and Balance

Your credit union understands the importance of offering convenient and accessible lending options to your members. With the evolving landscape of financial services, it's essential to explore and understand the differences between in-branch and online lending. Let's dive into each method to help you make informed decisions for your credit union and its members.

In-Branch Lending

People love to debate the necessity of branches. Although branch visitors have declined overtime, the percentage of people who visit branches for personal banking matters has remained relatively consistent, currently standing at 47%.

A study conducted by Backbase, a company that creates engaging banking experiences, found that Millennials and Gen Z rely on in-branch banking when digital options aren't sufficient.

Don't discount in-branch lending. With half of people still opting to go into a branch, this lending channel provides benefits to your members. These benefits include: 

  • Personalized Service: Your members receive personalized assistance from knowledgeable staff members. Face-to-face interaction fosters trust and understanding.
  • Face-to-Face Interaction: Direct communication enhances trust and understanding. Members can have their questions answered immediately.
  • Documentation Handling: Members complete paperwork with staff guidance, ensuring efficient handling of necessary documents.

How to Utilize In-Branch Lending

In-branch lending still provides a valuable opportunity to offer your members and credit union added value. Ensure that you maximize the benefits of in-branch lending to elevate member satisfaction and operational efficiency. 

  • Complex Transactions: Some loan transactions might be more complex or require additional documentation. In-branch lending allows for easier handling of such cases, providing support and guidance throughout the process.
  • Streamlined Processes: Invest in technology and training to ensure that in-branch lending processes are efficient and user-friendly. Members should feel that their time is valued and that the loan application and approval process is smooth.
  • Building Relationships: In-person interactions foster trust and strengthen relationships between members and credit union staff. This can lead to increased loyalty and member retention over time.

Leveraging your in-branch lending strategy can serve as a cornerstone for revenue generation within your credit union. It can also set you apart from competitors when executed effectively.


Digital Lending

The surge of digital lending is revolutionizing loan accessibility and growth for countless Americans. Surpassing 85%, a significant majority of financial institutions now provide digital lending options, showcasing its widespread popularity and adoption.

Digital lending represents the cutting edge of financial technology, offering unparalleled convenience, speed, and efficiency. Its benefits include the following:

  • 24/7 Accessibility: Digital lending platforms empower members to apply for loans anytime, anywhere, enhancing convenience and accessibility.
  • Efficiency and Speed: Automated processes streamline loan applications, approvals, and disbursements, reducing processing times and enhancing member satisfaction.
  • Scalability and Reach: Digital lending expands credit unions' market reach, enabling them to serve a broader demographic and compete effectively in the digital age.

Digital lending drives operational efficiency, enhances member experience, and positions credit unions as innovative leaders in the financial services industry, essential attributes for sustainable growth and relevance.

How to Utilize Online Lending

As digital lending gains more traction, it's essential for your credit union to harness this powerful tool to both draw in new members and cater to existing ones. Here's what should be at the top of your priority list:

  • Offer a variety of loan products: Provide a diverse range of loan products online, including personal loans, auto loans, mortgages, and small business loans. This ensures that members can find the financing they need conveniently online.
  • Integrate digital document management: Enable members to securely upload required documents electronically. Implement digital document management systems to streamline the verification process and reduce paperwork.
  • Offer ongoing support: Provide online support channels such as live chat, email, and phone assistance to help members throughout the loan application process. Clear communication and responsive support can enhance member satisfaction and trust.

By leveraging the power of digital lending strategies, your credit union can drive cost savings and boost operational efficiency.


Find the Right Lending Software for Any Situation

Whether you're engaging in face-to-face lending or embracing the digital realm, having the perfect lending software is crucial for meeting your members' needs. FLEX proudly serves over 250 credit unions with state-of-the-art lending solutions to keep you ahead of the curve. Click below to grab your complimentary copy of our lending eGuide and elevate your lending game today.

FLEX Digital Lending





Preston Packer

Written By: Preston Packer

Executive Vice President | CMO at FLEX Credit Union Technology
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