The credit union landscape will look completely different in 10 years, new research predicts

MADISON, WI (October 28, 2015) — New research from the Filene Research Institute, “Trending: Credit Unions in 2025”, paints the picture of a financial landscape that bears little resemblance to the system of today. Technological disruption, increased regulation, changing consumer behaviors, and asset growth will all contribute to the reshaping of the global financial ecosystem.

“Our analysis paints an overall optimistic picture of the future,” said Ben Rogers, research director for Filene Research Institute. “Assets will grow and the number of institutions will shrink, but credit unions should focus first on the incremental changes that can be made today to ensure sustainability and growth in 10 years and beyond.”

Areas that will see the most dramatic changes include the following:

  • Consolidation: An estimated 150–250 US credit unions close each year. Institutions of all sizes will be challenged to make the necessary investments to satisfy younger members
  • Payments: By 2020 card and cash usage will decline rapidly as digital payment methods become more practical and mainstream.
  • Technology:  Physical branches will still play an important role, but there will be an increased emphasis on delivering service excellence via digital interactions.
  • Lending. Core lending services are at risk. Sophisticated start-ups are nibbling away at unsecured loans, auto loans, mortgages, and business loans.
  • Regulation: Small financial institutions are increasingly challenged by new mandates, while compliance costs drain away profits. But regulation is also a moat that keeps some competitors out. The next 10 years will be crucial in developing sustainable internal and collaborative ways to deal with it.

As part of this project, Filene asked CEOs from around the country for their predictions for 2025. For example, we asked them: If we were to start on just one thing right now to prepare credit unions for 2025, what would that one thing be?

  •      “Enhanced electronic marketing to keep our remote members engaged.”
  •      “Make sure the personal touch does not get lost in the rush to technology.”
  •      “Migrating everything to the cloud.”
  •      “Easy virtual lending and loan closing process.”
  •      “Eliminate Dodd-Frank and the CFPB.”
  •      “A great mobility product with e‑access for debit and credit cards.”

Researchers also examined four possible economic scenarios: continued moderate growth, a credit explosion, rampant inflation, and another financial crisis. Good news for credit unions: Even in the worst scenarios the credit union system holds up. Readers are encouraged to test their own assumptions.

Prognostication is a notoriously difficult game. But this report can be the basis for conversations among credit union boards and staff as they plan for the next 10 years.

This report was made possible thanks to generous support from Credit Union Resources.

About Filene Research Institute

Filene Research Institute strengthens organizations through innovative research and incubation to improve consumer financial well-being. As an independent cooperative finance think tank, Filene’s membership network connects a community of leaders and bright minds to change lives through innovation, truth and cooperation. In addition to delivering cutting-edge, actionable academic research, Filene also provides incubators to test and scale solutions, events to spark organizations into action and advisory services to help accelerate and implement innovation. For more information, visit and @fileneresearch.


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