While self-service facilities, mobile apps, AI-based conversational bots, omnichannel presence are all considered the “Digital Quotient” for financial institutions today, there is growing concern amongst experts that credit unions, which are one of the key segments within the financial services umbrella, are not taking the digital transformation route, unlike banks and other FinTech firms.
There is consensus on credit unions being not-for-profit institutions and hence the challenge in spending on digital like others but again experts from the credit union industry are of the opinion that member addition and retention are key areas for the success of any credit union and with banks continuously ascending on digital enablement to attract clients, credit unions will soon have to disrupt themselves with innovation or lose business.
A recent article in the credit union journal says, “Credit unions have more data on their members than Amazon does on its customers”. What that means is, credit unions can start their digital transformation efforts from an analytics standpoint given the significant size of data they hold. However, a recent research study shows how the credit union industry is segmented into approximate thirds on how it views the importance of data.
This rough analysis proves to be fairly true based on the various interactions we have had with Chief Lending Officers, Chief Information Officers and Chief Technology Officers at various credit unions. Most credit unions agree that they have data but do not know what to do with it.
While they all agree that the goal is to acquire more members and retain existing members, the vision and ideas to get there don’t seem to exist. After all, “giving customers what they want at the time they need it is what Digital Transformation is” and the starting point to that is data and the patterns that emerge from data. This holds true for banking, retail, healthcare, manufacturing, and credit unions are not an exception.
Attracting a millennial with a low-interest mortgage loan offer when he/she is hunting for homes on a mobile phone is a great way to make a difference from your competitors using the power of data. Similarly, identifying a better dividend program or payout for members can happen by getting a member-centric view of data, which eventually leads to more member addition and retention.
The bottom line is, Data is not numbers but information and credit unions have tons of it. Data becomes worthless only when it is not analyzed and used properly.
Zuci is revolutionizing the way software platforms are engineered with the help of patented AI and deep learning models. Learn more about Zuci at www.zucisystems.com
About the author
Janaha Vivek is the Senior Marketing Executive at Zuci. Having expertise in Fintech with a background in Sales & Marketing, he is extremely passionate about new technology, innovation, and learning.
Check him out at Janaha Vivek.