How often do you engage with all of the different companies you do business with from your phone? I’ll bet you do it all-day long. With the advent of the smartphone, we have all become empowered consumers, aggregating all of the different things we need to do in our financial life into a suite of apps on our mobile phones.
How many of your members consider your credit union their primary financial institution? Research shows the average credit union enjoys this kind of a relationship with just two out of every 10 members. Is it any wonder why? With the advent of the smartphone, I would argue that PFI really doesn’t exist anymore.
Consumers have an overwhelming number of choices for saving, spending, investing, borrowing and protecting their money. Digital wallets, wearables, chatbots, robo advisors – the list of flashy fintech tools is growing longer by the day. Forced to cherry-pick their financial services, many cobble together something that looks nothing like a meaningful relationship.
Simply put, there is no single provider today that meets the holistic financial needs of the consumer. And the challenge is that because of this, consumers don’t know how they’re doing in their financial life. Through disparate apps, it’s hard for them to see the big picture. This is a massive opportunity for credit unions, requiring boldness, bravery and a lot of hustle.
Becoming a member’s primary financial relationship (PFR) in the digital era requires credit union leaders who are unafraid to get in the fray with so-called disruptors. They must be (or become) comfortable with moving fast to make positive, transformational shifts in the way they serve members.
Jumping into the battle for member business does not mean losing sight of the credit union difference. It calls for quite the opposite, actually. People, especially those in younger generations, want digital-first financial tools, but they want them from a trustworthy provider who is willing to coach them on using that tool in the most financially healthy way. Millennials, for instance, are incredibly thoughtful when it comes to making major decisions. They are much more likely to research major purchases and take the time to compare options by looking online and within their social networks.
Growing a people business in the digital era requires bold leadership. It takes strategic rigor and the willingness to pick a fight with much bigger players. Fintech startups, megabanks and big tech competitors are chipping away credit union business – and certainly not to help people achieve their dreams. Credit unions must fight for loyalty like their members’ financial health depends on it.
Let’s get real for a moment. The credit union movement is not growing at the pace it should. Lending and deposits are under pressure. Some credit unions are completely lent out, and leaders are struggling with what’s next. Continuing to rely on bread-and-butter staples when they are no longer feeding the cooperative is a dangerous play. Now is the time to get aggressive in the pursuit of growth from new places.
Credit union people, let’s revive our hustle. We may be smaller than some of our competitors, but we are in no way meeker. It’s time to remember what this movement is all about. We must regenerate our entrepreneurial, community-first spirit and expect as much from ourselves as the nation’s credit union members do. Let’s get enthusiastic about the possibilities and jump confidently into the race for excellence. Members expect our collaborative efforts to bring them the best blend of technology and human ingenuity, to be digital-friendly while being people-first. We have a responsibility, and importantly, we have the ability, to live up to those expectations.