Credit Unions Should Be Moving Forward with Mobile—Even Smaller Ones

Thirty two percent of U.S. adults now bank using their mobile phones. Statistics like these indicate that all credit unions should be moving forward with a mobile strategy. So said Brad Ganey, chief operating officer of Catalyst Corporate Federal Credit Union, to approximately 50 credit union leaders at the recent Shapiro Summit in Ontario, Calif. Sponsored by the California and Nevada Credit Union Leagues, the summit provides education for credit unions with assets of $50 million and less.

Ganey provided other recent statistics showing the percentage of banks offering various mobile banking services. Not surprisingly, information-based services, such as providing account balances or transaction history, topped the list. Also high on the list of most-offered mobile banking services were alerts, money transfers within a bank, and bill pay.

Ganey’s presentation featured a real case study of a $35 million Texas credit union that launched mobile banking and mobile capture services to its membership in April. After four months, the credit union is experiencing a monthly growth rate in active users of 42.2 percent. Ganey stepped his audience through key considerations the credit union faced in its due diligence process.

Those considerations included determining whether the service would align with the credit union’s overall strategy, Ganey said. “The first question the credit union had to answer for its board was whether its membership really needed mobile banking,” he said. “The CEO made the case effectively that without mobile, the credit union was not likely to attract new members in the 50-and-under age range and would risk losing current members anxious to take advantage of mobile banking services.”

Other strategic decisions, Ganey said, focused on the cost effectiveness of mobile. “Part of this credit union’s decision-making process was to determine whether mobile banking could serve as an alternative to branch expansion or to spending $20,000 to upgrade to an image-enabled ATM,” he said. “For many members, their cell phones never leave their sides. By incorporating mobile capture into this service, these members are able to deposit checks at any time, without locating a branch or an ATM.”

The credit union also views mobile banking with mobile capture as a tool to maintain relevance and increase deposit participation at their sponsor company. Their strategy includes promoting the service at new hire orientations to increase the number of checking accounts opened, Ganey said.

As the credit union serves 2,800 members from a single branch with seven full-time employees, deploying self-service delivery channels is critical, Ganey said. “To align with this strategy, the credit union determined that their mobile app must support this goal—with a strong end user experience that contains intuitive navigation and appealing graphics, the ability to add new features as member participation increases, and marketing capabilities at sign-on and within the app. The credit union, which opted for both Apple and Android smartphone apps initially, plans to add an iPad app in the future, so members can apply for loans on their tablets,” he said.

Ganey offered several strategies for “mobilizing” credit unions: 1) Understand your membership – utilize frontline staff; 2) Establish buy-in from your board through industry and mobile usage data; 3) Establish baseline requirements and longer term goals for functionality; 4) Ensure alignment with overall strategy and philosophy (member demographics, branch, and growth strategies); 5) Set vendor selection criteria (their vision and yours, integration with other systems, training and ongoing support, implementation assistance, analytics, cost); and 6) Determine if mobile can be justified financially (revenue and/or growth opportunities, expense reallocation, expense reduction).

Credit unions that did not attend the Shapiro Group presentation have a couple of additional opportunities to find out the latest developments in mobile banking. Catalyst Corporate will sponsor the following upcoming mobile banking presentations: Steve Reich, chief sales officer and an owner of premier mobile app developer Malauzai Software, will address “Maximizing the Mobile Experience” at Cornerstone Credit Union League’s Leadership Conference on September 7. Jim Van Dyke, CEO of Javelin Strategy & Research, will speak on “New Trends in Mobile Banking” at Catalyst Corporate’s Economic Forum on Oct. 22. For more information, contact Catalyst Corporate at 800.442.5763 or contactus@catalystcorp.org.

Catalyst Corporate is a wholesale, cooperative credit union with a national field of membership headquartered in Plano, Texas. Catalyst Corporate and its wholly-owned Catalyst Strategic Solutions subsidiary offer more than 1,500 credit unions competitively priced payment, investment and liquidity services.

 

Strategic Link is the NWCUA’s wholly-owned service corporation, using the power of aggregation to provide the Association’s member credit unions with exclusive high-quality, competitively-priced products and discounted services. Contact Director of Strategic Partnerships Craig Reed today to find out how Strategic Link can help your credit union save money while meeting its goals in 2013 and beyond: creed@nwcua.org.

Posted in Article Post.