Key insights for building digital lending and account services for your credit union

Is your credit union providing members with fully digital services? If not, or if you are encountering challenges doing so, these insights from PwC’s 2021 Digital Banking Consumer Survey, which canvassed 6,000 retail consumers will help you understand the type and structure of the digital financial services you need to build into your credit union’s product offering.

The survey also highlights how urgent it is to do so in order to maintain and grow your member base in light of the following market and demographic trends:

• Over the past year and a half, a significant number of customers have become accustomed to digital interactions, and spent less time in branches.
• Consumers have been finding their way toward alternative banks with little or no physical presence, and the growth in non-financial accounts seems to have come at the expense of both regional and community banks.
• This shift toward non-bank providers is especially evident with younger consumers who are proactively seeking alternative providers.
• The opportunity exists to package trusted advice and convenience through solutions rather than products.
• A gap exists in meeting customer preference for digital account opening: 20-25% of consumers would prefer to open a new account digitally but are unable to do so today. For example, 21% of those opening a new deposit account (e.g., a savings account or CD) would prefer to do this digitally, but are unable to do so at their current bank.
• Branches still have their place for many users: 33% prefer the branch for certain activities. Although they were forced to use digital channels during COVID, two in three customers still find branches to be a meaningful channel to interact with their financial institutions, especially for activities like account management or financial research.
• While digital channel use accelerated, there’s still a meaningful customer segment (35%) reporting that they would not use a bank that doesn’t have a nearby branch.

How can your credit union use these insights to more effectively deliver digital services? There are several key actionable points:

According to the study, financial services tied to affinity groups, a particular industry or a particular behavior can be particularly attractive to digital consumers. Consider the niche groups your credit union serves, how can you leverage those to create targeted, member-centric digital services in these areas?

PwC also reports that it “isn’t enough to say that your service offering is meaningful for elementary school teachers or locksmiths. You need to demonstrate to your target audience that you understand their needs and that your solution offers benefits that other banks don’t. You’ll want to have a team that is responsible for designing and iterating on offers, and that has the capability to capitalize on customer needs to introduce relevant products and features.”

In addition, the study emphasizes that in order to take full advantage of the digital financial services opportunity, a modern, seamless and secure internal technology and infrastructure and workflow are necessary, especially in retail lending and account  management: “Cloud-based systems now make it far easier to develop and test products, scaling up and down resources quickly as demand rises or falls.”

SmartVault supports this recommendation as a best of breed cloud-based document management system with digital signature capabilities, as well as internal and external collaboration as a cloud-based, fully customizable, FINRA-compliant solution.

Make an Actionable Plan to Leverage These Insights into New Opportunities

Considering these highlights from PwC’s survey, clearly there is a shift in the market occurring toward digital and non-bank financial services which credit unions are uniquely positioned to own. Now is the time for your credit union to create an actionable plan and implement the supporting workflows and infrastructure to leverage the available opportunities, especially in the lending and member account areas.