Credit unions (CUs) are scaling back their in-house development efforts at a time when customers, and credit union members in particular, are looking to these financial institutions for greater product innovation.
The innovation slowdown is untimely and being misunderstood, claim 100 CU executives and 50 executives from FinTechs who offer goods and services to CUs in the research “Credit Union Innovation: Product Development Slowdown Tests Member Loyalty.”
The survey’s unsettling finding is that almost a quarter (27%) of CU members would transfer FIs in order to access more sophisticated financial products. Just 17% of CU members stated they would move due to innovation in 2018, indicating that this unhappiness has been growing for years.
What are these new developments? It focuses mostly on electronic payments. According to the report, 64% of members who have been loyal to CUs demand better digital payment experiences from those institutions.
As with non-members, who also want additional and ideally simpler methods to obtain credit products, access to credit is high on the list of desires for CU members.
In the last year, CUs have seen a 71% increase in credit applications.
According to the survey, “CUs, in turn, are moving aggressively to speed up the loan approval process: 53% of CU executives say they are making very or extremely significant steps to reduce the time to set up a loan for a borrower, and the remaining 47% say they are making slightly significant or somewhat significant steps,”