by: Marvin M. Garland, Chief Operating Officer, LEVERAGE
If technology was the biggest buzzword for credit unions in 2011, mobile has to be leading the pack in 2012. Everywhere you look is a story about mobile banking, mobile deposit capture, or increasing your mobile footprint. Jumping into the mobile marketplace is a must for credit unions, but knowing exactly what you want before you leap is more important.
The sale of smartphones is increasing rapidly. Earlier this year, the Pew Internet Project survey found that nearly half of cellphone users have a smartphone. But, digging a little deeper into the numbers, you find that 71 percent of 25 – 34 year olds have a smartphone. Credit unions are thinking more about the younger demographic and mobile technology fits this demographic like a glove. CO-OP Financial Services recently told credit unions that by 2016 half of U.S. adults will adopt mobile banking. IMS Research believes by 2016, one billion smartphones will be sold.
I know you’re thinking, that’s a lot of numbers, but not the numbers that worry me. For credit unions, jumping into mobile services is an investment in your current members and potential members. The typical smartphone user, and therefore mobile services user, is the type of member most credit unions would like to capture. Smartphone users normally have a higher income, more assets, and higher deposits. Let me throw a little curve here, though. Just adopting mobile banking is not enough.
According to Alix Partners, a global performance company, mobile remote deposit capture (RDC) is enough of a caveat to get consumers to switch financial institutions. Mobile RDC allows members to take a picture of their check with their smartphone camera and then deposit it into their account. Sixty-one percent of consumers between the ages of 18 – 34 say mobile RDC is important to them, as well as 51 percent of consumers ages 35 – 49 see the value in mobile RDC. Plus, the average income of those that value mobile RDC is ideal – 50 percent make more than $75,000 per year. So, by adopting mobile RDC a credit union is making a strong value proposition to the member.
Now to the numbers that worry you. Many consumers that fall in the Gen X demographic, and many more in Gen Y, say that they rarely visit a branch anymore. They do all of their transactions online, through their phone, or at an ATM. Work with a mobile services provider to find what your credit union is capable of handling and what you are comfortable with offering. It will be a financial investment that will pay dividends down the road.
Credit unions have struggled for years to show potential members that they are as modern as other financial institutions. This is the perfect time for your credit union to adopt a mobile strategy. Make sure that strategy is aligned with your credit union’s strategic plan and that it also matches your membership. But remember, you will be showing the next generation of credit union members, which will be the largest ever by the way, that you have what they are looking for. It’s worth the investment.
Marvin Garland is the Chief Operating Officer for LEVERAGE, the LSCU Service Corporation. LEVERAGE is a business services provider that works with clients to meet their mobile needs, including mobile remote deposit capture. It also offers a revolutionary ePurchasing platform and a contract management system in Ventelligence, an automated compliance execution powered by ComplyTrac, as well as many other solutions. Visit myleverage.com to learn more about how credit unions have leverage in the marketplace. You can follow LEVERAGE on Twitter or LinkedIn.