Source: Jack Henry
Credit unions face increasing pressure to do more with less. As new competitors enter the space, channels proliferate, and security and compliance demands compound, the battle for market share and deposits only becomes more intense.
Credit unions should strategically leverage technology to highlight their competitive distinctions while maintaining the ability to keep member service personal.
Jack Henry & Associates, Inc.® (NASDAQ: JKHY), a leading provider of technology solutions and payment processing services primarily for the financial services industry, conducted its inaugural Technology Capabilities Roadmap Assessment, combining data from 119 credit unions of all sizes.
While credit unions understand the growing importance of investing in technology and digital delivery, their “people helping people” philosophy and user-centric focus signal that it’s still all about the member relationships.
• While fintechs are introducing their own payment tools like debit cards and mobile wallets, 97% of respondents have already deployed debit - same for mobile bill payment - and 71% are already developing or have mobile wallets live. At the same time, about two-thirds of respondents have deployed P2P, with these launches expected to move more quickly as networks and processors work together to onboard more credit unions.
• 38% of respondents are already developing or have a live digital-only brand, targeting a niche consumer audience. Interestingly, the percentage of credit unions doing this is highest among institutions with less than $500 million in assets.
• Credit unions are creating member experiences that are real time, multitouch and conversational. While only 23% of respondents have deployed virtual tellers to date, 76% expect to deploy them by the end of 2020. More than one-third of respondents have also released personalized live chat capabilities.
• Modern technologies require a history of data to be most effective, prompting credit unions to take advantage of data enhancements - like artificial intelligence (AI) and its subsets, machine learning and predictive analysis - to personalize offers, solve payment fraud, and much more. 89% of respondents plan to implement machine learning by 2022. More than half of respondents are currently researching and planning for predictive analytics.
Ted Bilke, vice president of Jack Henry and president of Symitar, explained, “Credit unions’ ongoing member growth confirms that they are appropriately responding to market pressures with smart technology investments that emphasize open, digital strategies with an appropriate balance of personalization and self-service. These institutions are central to their communities, and Jack Henry remains committed to helping them mature and thrive as financial services evolves.”
The first annual Jack Henry Technology Capabilities Roadmap Assessment provides the information and analyses to help financial institutions develop their business strategies and technology roadmaps so they are more future-ready. The research survey of credit unions focused on industry trends in five key strategic areas - Business Intelligence; Digital; Fraud, Risk and Compliance; Payments; and Service and Support.