In the face of economic uncertainty and rising operational costs, growth and resilience are critical for credit unions. To achieve this, many are strategically aligning their priorities accordingly. Jack Henry's 2025 Strategy Benchmark report cites the top three priorities for credit unions over the next two years as:
- Increasing operational efficiency: With growing non-interest expenses and loan-loss provisions putting pressure on net income, it’s easy to see why 41% of credit unions cite this as a top strategic priority over the next two years.
- Growing loans: As traditional revenue streams face challenges, 40% of credit unions say expanding loan portfolios is essential for sustaining financial health.
- Acquiring new accountholders/members: Attracting new members is crucial for long-term viability, with 40% of credit unions prioritizing this in an increasingly competitive landscape.
The current financial environment is changing daily, requiring the proactive approach these priorities embrace. Success is dependent upon innovation, member-centric services, and strategic investments in technology to drive efficiency and growth.
Rising consumer debt: A call to action for credit unions
While credit unions strive to become more efficient and grow, they must consider the broader economic landscape. Escalating consumer debt, in particular, can impact strategic goals.
U.S. household debt surged to reach a record $18.2 trillion in the first quarter of 2025. This increase is largely attributed to higher balances in mortgages, credit cards, auto loans, and student loans. Notably, credit card debt has climbed to $1.18 trillion, down a hair from an all-time high of $1.2 trillion in Q4 2024.
Delinquency rates are also on the rise, with the overall delinquency rate for consumer loans reaching 2.75% in the fourth quarter of 2024.
External pressures threaten strategic goals
In addition to rising consumer debt and delinquencies, credit unions face external pressures of their own, including operational strain, loan portfolio risks, and challenges to member engagement and acquisition.
Operational strain
The rise in loan delinquencies makes it increasingly difficult for collections and back-office teams to do their jobs with existing resources. Rising delinquencies increase operational costs and disrupt workflows. Worse yet, any existing operational efficiencies are amplified.
Here’s where it shows up most clearly:
- Collections workflows: Staff must manage a larger volume of delinquent accounts, increasing the time and resources needed.
- Member communications: More delinquencies mean more phone calls, emails, letters, and account updates.
- Payment processing and exception handling: As more accounts fall behind, the number of failed payments and disputes rises, creating additional manual work and reconciliation tasks for back-office staff.
- Reporting and compliance: Increased delinquency triggers more scrutiny from regulators and internal stakeholders.
- Credit loss provisioning and risk adjustments: More delinquencies mean more time spent on adjustments to loss reserves, tighter oversight of allowance calculations, and greater coordination between finance and lending teams to align on risk mitigation.
These pain points turn into costly inefficiencies if credit unions are relying on legacy systems, siloed departments, or manual processes. More time, more labor, and more room for error—right when precision and efficiency matter most.
Loan portfolio risks
Economic uncertainty is leading to tighter margins and increased credit risk. The NCUA's 2025 Supervisory Priorities emphasize the need for robust credit risk management practices. This includes thorough loan underwriting standards, effective collection programs, and adequate Allowance for Credit Losses reserves. Credit unions must navigate these complexities to maintain healthy loan portfolios.
Member engagement & acquisition
Attracting and retaining members, especially younger or financially stressed individuals, is becoming more challenging. These cohorts tend to be cautious and often struggle financially, making them more selective about their financial institutions. Engaging this demographic effectively requires the right tools and digital experiences.. The NCUA highlights the importance of consumer financial protection and the need for credit unions to work with borrowers encountering financial difficulties, aligning with the credit union system’s mission of meeting members’ credit and savings needs.
Driving smarter growth with member-centric technology
It’s clear credit unions face stark challenges in 2025; however, it is possible to achieve those strategic goals while staying efficient, even under operational strain. The MeridianLink® One platform helps credit unions balance it all:
- Serving members better in their financial journeys, even in tough times
- Growing loans responsibly with real-time insights and automation
- Attracting and onboarding new members quickly and securely
Credit unions looking to thrive in a competitive and complex financial landscape need more than just good intentions. Real success requires smart, scalable systems that meet members where they are and evolve with their needs.
Growth starts at the front door with fast, secure digital account opening and identity verification that reduces friction without sacrificing trust. An omnichannel experience ensures members can engage whenever and wherever they want: online, in-branch, or on mobile.
Once they're in, intelligent cross-selling takes over. Using real-time data and credit insights, credit unions can offer personalized, relevant product recommendations that deepen relationships, not annoy members.
Lending is all about covering every life stage with end-to-end support: from automated decisioning to configurable loan workflows, plus tools for proactive risk management. Meanwhile, real-time analytics and marketing automation help teams reach the right members at the right time with offers that truly resonate.
When challenges arise, delinquency management tools support both members and staff with early warning indicators and compassionate recovery workflows. Throughout it all, expert consulting and support ensure your systems stay sharp, responsive, and future-ready.
Creating real impact for the community
When credit unions combine empathy with intelligent, scalable technology, they don’t just grow—they lead. And digital platforms like MeridianLink® One empower credit unions to meet today’s challenges head-on: streamlining operations to control costs, accelerating loan origination with smart automation, and creating seamless onboarding experiences that attract and retain members.
Beyond performance metrics, this approach delivers something deeper—stronger relationships, healthier deposit flows, and communities that feel supported through every economic cycle. Human-centered digital experiences build the trust and loyalty members need now more than ever.
This is how credit unions turn strategy into lasting impact: by aligning mission with modern technology to grow stronger, serve better, and stay resilient—no matter what lies ahead.
To learn more about the digital platform designed to put you and your members first, visit meridianlink.com/meridianlinkone The materials available in this article are for informational purposes only and not for the purpose of providing legal advice. You should contact your own advisors with questions regarding the content herein. The opinions expressed in this article are the opinions of the individual authors and may not reflect the opinions of MeridianLink, Inc.
