Smaller Institutions Lead the Charge for Technological Innovation
By Tom
It’s very possible that credit unions and smaller banks could lead the way when it comes to technological innovation, and that’s a good thing if they want to attract the new generation of banking customers.
As in any business, the larger the organization the harder it is to promote innovation. As Tom Bryan, CEO of Nymbol Technology in Atlanta, wrote on an editorial in Credit Union Times this week:
“Not only is technology better, less expensive and more widely available than ever, more important, smaller institutions like credit unions are simply more agile. The enterprise-wide IT systems big players installed 20 years ago were cutting edge then, but today are legacy systems, often with outdated architecture that is difficult and expensive to upgrade.”
Younger customers have come to expect conveniences such as online banking and mobile check capture to be the norm. They are more inclined to make a cloud-driven transaction than walk into their local credit union or bank. Customers want virtual banking to be faster and accessible across a wide range of tools and apps. Frictionless transactions are the latest trend and it seems likely that smaller banks and credit unions will take the lead because they can be more nimble.
This agility to adapt to the rapidly evolving needs of customers is what gives the smaller institutions a leg up on their competition. Being able to bring new products and new product bundles to market faster will make these smaller institutions innovators that will attract early adopters. And these same institutions have the added advantage of experimentation. It doesn’t take as much effort to roll out a new product that has never been tried to see how well it’s accept. Larger institutions take longer to create and launch a new product or initiative, and when they fail they usually fail big. As they say in the world of innovation, fail fast so you can retool and try again.
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