Study Outlines Latest Consumer and Member Behavior Trends

For credit unions, maintaining and growing their member relationships, as well as enhancing their ability to reach a new generation of financial consumers, is more important than ever.

Changing consumer expectations, accelerated in many cases by the COVID-19 pandemic, are moving toward digital banking primacy, reducing the need for in-person, face-to-face interactions in a physical branch. At the same time, disruptive and agile competitors are eating into credit unions’ market share in traditional financial services areas such as banking, investing, and lending, with increasing levels of success.

To better understand the current marketplace, Strategic Link partner Co-op Solutions worked with global consulting firm EY (formerly Ernst & Young) to determine how financial consumer and member behaviors, preferences, challenges, and activities have changed over the past year. For an added layer of insight, Co-op also engaged Filene Research Institute to assess credit unions’ current challenges and opportunities for growth.

Key findings include:

  • Fintechs are harnessing payment products to accelerate growth and take over the marketplace. For example, PayPal experienced 5X relative growth in PFR (primary financial relationships) and Chime showed 18X growth.
  • Consumers trust fintechs over credit unions to serve their digital payment needs and wants, with credit union primary payment relationships falling by 3%.
  • 66% of consumers use some form of digital payments, yet only 16% report doing so directly with their credit union.
  • 41% of respondents would consider leaving a credit union because the products don’t meet their current needs.
  • 78% of respondents don’t expect their credit union to offer the digital payment options right for them.

Delivering the right products and services to meet daily needs now rivals data protection, security, and personal relationships as the most important factor when trusting a financial institution.

To address these evolving expectations and increased competition, and be truly member-centric, credit unions must support their members in their routine activities, interacting with members at multiple points each day. The best way to activate daily engagement is by offering digital payment options while creating financial transparency and helping members take control of their own financial lives.

There is ample opportunity for credit unions to “future proof” their economic and service models. With the support of strategic industry partners with the expertise and ability to provide consultative advice and the right solution set, credit unions can design a modern member experience that will help grow and maintain their member base while increasing operational efficiencies to propel credit union growth.

Credit unions can access the full white paper here.

To learn more about Co-op Solutions, visit it online or contact NWCUA’s Strategic Link team to get connected.

Posted in GoWest Solutions, Industry Insight.