Credit unions are no exception to the growing demand for financial institutions to go digital.
While known for their more personal relationship with borrowers, credit unions are still subject to the pitfalls of not going digital.
In fact, a new study by financial product comparison site MagnifyMoney found that credit unions that offer fewer digital services are losing assets, an article in Credit Union Times by Tina Orem stated.
From the article:
“This sends a clear warning to credit unions: If you want to grow and prosper, you will need to invest in digital capabilities,” the study said.
“This study shows that the large credit unions are investing in digital technology, growing their user base and creating best-in-class experiences for their consumers,” the study said. “However, there is a real risk for the smallest credit unions. They will need to find cost-effective ways to embrace digital technology, or face risks.”
The data cited in the story measured credit unions’ digital capabilities on a scale of 0 to 100, finding that credit unions with the highest digital adoption scores (75 to 100) grew their assets in six months by 3.85%, versus just 0.23% for credit unions with scores of 25 to 50. For those with scores below 25, assets shrank 1.12%.
With originations declining, lenders must compete more effectively for market share, Kelly Adkisson, a managing director for Accenture Credit Services, recently said in HousingWire’s May feature “Digital disruption: How consumer demand is pushing lenders to a new normal.”
Although the feature focuses mainly on digital mortgages, the desire for digital doesn’t change based on the product or need. “What sets the pace of what has to happen is how consumers are using digitalization in other products and services,” said Mary Coffin, executive vice president with Wells Fargo.
Julie Lane, senior vice president of home lending digital sales with Wells Fargo, said, a whopping 92% of American adults own a cellphone, 64% own a smartphone and approximately 19% of the U.S. population relies on their smartphone for online access with no home Internet access.