Credit Unions vs Technology
Credit Unions, while different from banks are (in our opinion) a better choice for growing your finances for many reasons, but, one notable reason is their aim to serve their members; while banks primary obligation is to their shareholders and not their customers. Now, this post does not focus on a comparison between Banks and Credit Unions, but to highlight one of the main reasons Credit Unions are not performing at their best.
The Problem Affecting Credit Unions?
The reason, while it can be simply stated, the impact is quite great and results in the loss of revenue to the Credit Union. It is the fuel that powers all organizations in any niche you can think of and is one of the catalysts required to improve organizational efficiency, processes, productivity and reduce capital expenditure. It is the creator of many opportunities for new business, resulting in new revenue streams.
It is, “Technology.”
Technology, where would we be without it today? There are many disruptive technologies that not only improve the way organizations do business and communicate but also solves socioeconomic problems.
These disruptive technologies continue to help business scale to new innovative heights utilizing:
- Cloud Technologies
- IoT – Internet of Things
- DLT – Distributed Ledger Technology
- AI – Artificial Intelligence
- AR – Augmented Reality
- VR – Virtual Reality
- 3D Printing
- Autonomous Vehicles
- Renewable Energy
For Credit Unions, technology has become a troubling paradox. Therefore, many are not investing in technology or effectively utilizing technology and are not reaping the many benefits an ongoing investment in technology brings.
Many Credit Unions are still operating on dated infrastructure and technologies, depend on manual processes, don’t hire the right talent and don’t understand the total cost of ownership in technology (TCO). Because of a lack of understanding of the TCO in technology, they cannot truly determine their return on investment (ROI) in technology. Not taking TCO into account can lead to many unwanted challenges down the road.
With aging memberships and tech-craving millennials, if Credit Unions want to compete with Banks, other fintech organizations, retain and grow a younger customer base, they must have a clear strategic plan for the utilization of technology within the Credit Union and provide innovative products and services.
Credit Unions can improve their technology footprint, operations, and competitiveness by:
- Upgrading physical infrastructure – LAN / WAN, computer and server infrastructure
- Implementing cloud technologies such as SharePoint, Office 365, Teams
- Utilizing data analytics tools such as Power Bi or Tableau
- Being proactive against possible disasters by implementing business continuity solutions
- Upgrading the Core Financial System to one that is scalable and offers modern tools and services such as Probanx Information Systems
To learn how we can help your Credit Union utilize technology to become more competitive and profitable, contact us. We would love to hear from you.