Credit unions tend to be smaller than most financial services providers, but that doesn’t mean they can’t or shouldn’t run with the big guys. Leveraging business partners can help credit unions provide greater convenience for their members as well as streamlining operations without needing the internal expertise. And consumers have come to demand immediacy in their banking options, like online and mobile. They want control and access when they want it and how they want it. Most credit unions, and even larger institutions, don’t have the resources to build these platforms on their own. Fintech partnerships can help credit unions expand into new markets, reach new members, serve your existing member base, increase efficiency, access data, and continuously innovate.
Fintech partnerships have proven to be faster and less expensive than building or buying new technology. However, partnering comes with its own risks and vendor management requirements. Fintech companies can perform a variety of services for credit unions, each requiring unique vendor management policies, processes, and procedures. Myriad laws and regulations – possibly more than there are vendors in existence – guide the structures your credit union puts in place to manage them all and ensure compliance. Keep these guidelines in mind when partnering with a third-party service provider:
- Conduct periodic audits and reviews and ask whether your partner can provide support in these areas as necessary.
- You are legally responsible for your partner’s actions.
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