Attract millennials through banking innovations
Credit unions (UCs) have made efforts to meet the digital demands of members since the pandemic began a year ago.
Investments in digital transformations have not only been necessary to help members do their banking activities from the security and convenience of their homes, but they have also been necessary for UCs to help attract younger members. . This is an ongoing challenge for CUs as the middle age of members is 47 years old. Research also suggests that UC’s appeal to older consumers does not always translate into banking success with members’ adult children.
Walking Credit Union Tracker® explores the latest developments in the UC industry, including a review of how the digital switchover and offering of technologies that satisfy members of all ages is necessary for UCs to compete with financial institutions (FIs) and maintain llong term success.
Around the landscape of credit unions
With in-person interactions on college campuses limited due to the pandemic, some CUs are looking for new ways to bring younger members into the fold. An investigation found UC membership is not passed from generation to generation, and digital banking and online awareness is not enough to attract younger members. the Pennsylvania State Employees Credit Union (PSECU) is one such UC that has said it uses social media as its primary means of attracting students by featuring campus ambassadors. The Harrisburg-based CU also operates ATMs and funds training centers on more than 20 campuses across the state, which serve as recruiting tools for students.
The CUs may have had a rough 2020, but there were some bright spots as well. A quarterly report from National Administration of Credit Unions (NCUA) has shown that commercial loan and mortgages have been strong as interest rates hit historic lows. Loans ended the year with a 5% growth rate, while the loan-to-equity ratio fell more than 10 percentage points year over year in the fourth quarter of 2020. The report also states that deposits grew nearly 20% year over year over the same period as mOre members worked to save money during a financially turbulent year.
UCs are also striving to meet the needs of small businesses more than ever. the Federal Reserveof Small Business Credit Survey found that 87% of small and medium enterprises (SME) who requested loans, lines of credit, or cash advances from CUs last year reported being satisfied. SME satisfaction with loan offers from small banks followed at 81%, while large banks and online lenders lagged at 68% and 43%, respectively.
To learn more about these and other stories, check out the Trackers News & Trends section.
Service Credit Union on taking the digital initiative to attract young consumers
Attracting younger members has been a challenge for many CUs, in part because CUs have been reluctant to invest in essential technologies to convince them. While there is no single answer for UCs to solve this problem, envisioning profitable digital innovations and tailoring their messaging specifically for millennials could be part of the solution, Dan Clarke, senior vice president of l ‘member experience at Credit Union Service, said PYMNTS.
In this month’s featured article, Clarke discusses how UCs can partner with colleges and move beyond their risk averse nature to embrace the technologies young consumers demand.
To get the full story, download the Tracker.
Almost a third of UC Millennials and Bridge Millennials say they would be willing to leave their CUs for financial institutions (FIs) that offer more innovative products and services. This fact cannot be lost on UCs striving to update their digital approaches.
This month’s in-depth dive explores the struggles CUs face when recruiting young members and explains why focusing on specific digital technologies could be a successful approach.
Read the entire deep dive in the Tracker.
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