All around the country, credit unions are seeking the best strategies for moving forward. Since the pandemic has changed consumer behavior dramatically and things are unlikely to return to normal anytime soon, credit unions must adapt to the times and provide members with the services they now want and need. After all, credit unions were founded to serve their members. But to do so, it helps to understand current trends in the credit union world and the economy at large.
Perhaps the biggest change in consumer behavior as it relates to credit unions is that members now want to conduct traditional financial transactions using digital technologies. This has caused a bump in e-commerce and the rise in digital wallets, mobile banking, and other digital financial solutions. It also signals an end to the times when members would come to the branch for everyday financial transactions. For credit unions, the future involves finding ways to provide members with the technologies and digital solutions they desire.
The importance of onboarding and digital solutions
Some credit unions excel at signing up new members, yet when it comes to onboarding and seamlessly facilitating direct deposits and recurring payments from new members, they struggle. Without an efficient onboarding and engagement strategy in place for new members, time and money is wasted and the overall efficiency of the CU is diminished. In 2021, CUs need to do everything they can to stay efficient and generate income.
One common reason potential members are lost is because traditional ways of onboarding like emails or “switch-kit” PDFs, which members are expected to fill out at home and return to the branch, have historically low rates of success. Predictably this has worsened with the pandemic. In the future, CUs should expect members to continue to reject in-person onboarding processes in favor of easier, quicker digital solutions.
The benefits of integrating account switching technology with a core system
As in-person interactions and branch visits decline, credit unions must decide which technologies to implement and how to onboard potential members. CUs that have integrated technologies and create a seamless, user-friendly experience for members during the onboarding process have seen increases in new members and profits, which during such difficult times can be vital to keeping a CU afloat.
One popular solution for CUs is to use an automated account switching solution technology, like ClickSWITCH. Account switching technology helps members switch recurring payments and deposits to a new account, making it easy for members to change credit unions or financial institutions. Some of these also allows CU employees to engage members during the onboarding process.
Furthermore, many account switching technologies can be integrated with credit union core system software using API technology to create a seamless connection between your CU’s onboarding process and your mobile banking, digital lending and other features provided by the core.
The benefits of strong credit union core software technology in onboarding
Having the right core processor also plays an important role in onboarding members and engaging them once they have switched to your credit union. Core software technologies like FLEX, which has an open API and seamless integration capabilities, have been successfully used with account switching technology as well as other software.
Listed below are some more examples of what the right core system can do for your CU:
- Digital lending. Just like the onboarding process, lending is going digital. A core system can enhance your bank’s digital lending capabilities with features such as electronic document flow, eSignatures and mobile lending applications. This can increase borrowing from members and create a more sustainable CU.
- Engagement. Core software technology can help engage members through push notifications and built-in customer support.
- Cross-selling. While attracting new members is important, so is not forgetting about your existing members. The right core software can facilitate cross-selling by helping your MSRs engage with existing members, and provide data that can be used to target members, while automating routine processes to free up time for staff.
- Online and mobile banking. As e-commerce continues to soar, members want to be able to shop safely and easily online. Good core software should offer the best of online banking to members.
- Reduce third party vendors. Choosing the right core system that develops software and seamlessly integrates products and services will allow your CU to cut down on third party vendors. By doing so, your CU can reduce cost, increase efficiency and create a user-friendly experience for members.
- Improve your key growth metrics. A core software provider can help your CU improve important metrics like return on assets (ROA), loan originations per employee and the cost of technology per member.
Generally speaking, the right credit union core solution will increase the overall efficiency of your credit union and free-up time for employees to focus on other important aspects of running the CU. This range of benefits and features should be touted throughout both your marketing to prospective members as well as your onboarding process. Teaching, or simply reminding, your membership about your range of services and products will help turn them from new members to lifetime ones.
Technology and the bottom line
The pandemic thrust us into a technological age, causing consumers all around the world to look for new and improved ways to shop and transact digitally. But one important question for the future of CUs and other businesses is how well they will be able to provide digital solutions that are also personal and supportive, the way they strived to do in the past. After all, CUs were founded on the tenets of community and cooperation.
For credit unions to survive and stay healthy in this new age, but also not risk losing the personal touch they are known for and proud of, they will have to think carefully about which technologies they choose to integrate. Credit union core software solutions like FLEX, which develops open software and can be adaptable to the needs of any CU, may be the best bet.
Read our case study to understand how one credit union strengthened their member onboarding process through the right technology.