Why should credit unions prioritize member retention?

As the financial landscape continues to intensify with new and emerging players, consumers have gained a new sense of freedom and choice when it comes to how they bank. This has made it common for consumers to have relationships scattered across multiple financial providers and apps.

Credit unions that prioritize delivering services that cater to their existing member base can break through the competition and reduce the risk of losing market share. Members who have already established a relationship with their financial institution have an existing familiarity and sense of trust, and if they find value in the financial support provided, they’ll likely stick around.

Existing members are essential to a credit union’s future growth—these members make up 65% of a credit union’s portfolio. However, in today’s landscape, most financial institutions focus on acquiring new members, rather than satisfying the needs of their existing base: Data shows that 44% of companies focus on member acquisition, while only 16% focus on retention.

While acquisition is one of many important initiatives for growing portfolios, loyal members generate more revenue every year they stay with a credit union. New members may be more cautious about purchasing new products until they are comfortable with your organization. Existing members, on the other hand—those who already trust and value your products—tend to buy more over time.

 

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