Digital Banking: The Gateway to Membership Growth and Competitive Differentiation

“Digital Banking” Is Banking

Guest Editorial from Jack Henry

The transformation of financial services is accelerating, driven by competitive pressure, profitability demands, and rapid technological advancement. Your members no longer distinguish between “digital” and “traditional” banking. They simply expect fast, secure, and intuitive experiences, anytime and on any device. Ignoring this could hamper your credit union’s success.

People want everything in one place, with minimal friction – whether it’s paying bills, sending money, or managing cash flow. By meeting their expectations, you open the door to growing membership, revenue, and long-term success.

The 2025 Strategy Benchmark study from Jack Henry™ reveals that credit unions are focused on increasing efficiency, growing loans, and acquiring members. To achieve these goals, it’s important to implement digital-first strategies that reduce barriers to financial health and deliver simple, safe, and always-accessible tools through your digital experience.

Attract Key Audiences to Your Digital Experience 

Your digital front door is where relationships begin. It’s often the first impression before a login or a branch visit. Many credit unions lose potential members due to friction, confusion, or lack of personalization.

While every credit union is unique, there are three critical audiences you should seek to serve with fast, seamless digital experiences to drive sustainable growth and revenue.

Ensure your strategy includes:

• Gen Z and millennials, who heavily prefer banking via their mobile phone. This next generation is set to inherit significant wealth from their parents.

• Small business and commercial accountholders, who are likely already using personal accounts for business banking. Analyze your data to identify these camouflaged SMBs and offer them helpful solutions.

• People in your community. Meet people where they are, whether on-campus, at local events, online, or in-branch. Equip your staff with devices to open accounts instantly on-site.

By delivering exceptional service paired with intuitive digital functionality that meets your members’ expectations, you’ll build trust from the first interaction.

Differentiate Your Credit Union

Brand differentiation starts with your purpose. Stay grounded in your mission and values to stand out. Forge stronger connections with your niche and community audiences through messaging they identify with.

Enable Personalization

Your members are used to tailored web experiences and personalized product offers – think Amazon and Netflix. You can deliver similar experiences with relevant and timely financial wellness resources.

What to provide:

• Offers for lower interest rates on loans

• Advice on saving surplus funds for future goals

• Spending alerts

• Personal budget planning

When a member faces life changes, you can make a strong impact by being there with useful advice and circumstance-based tools and content.

Meet Expectations During Account Opening

When your credit union enables a smooth and simple account opening experience, it can make all the difference in reducing drops. Quickly and securely deploy enhanced experiences by adopting a scalable, end-to-end solution that supports multiple lines of business and integrates easily with your existing technology.

Today, people expect:

• To open a new checking or savings account in 5 minutes or less

• An omni-channel experience with the ability to start on one device and finish on another

• A seamless, step-by-step process with quick verification and answers to questions

• ·To apply on any device, in a browser or from an app

Compete With Fintechs and Big Banks

As potential members of all ages arrive at your credit union’s digital front door, a fast, intuitive account opening experience can build loyalty and drive share of wallet. By empowering them to self-serve, you can free staff to focus on relationship-building.

Research shows that 50% to 75% of new account applications are abandoned, creating opportunities for you to reduce friction and simplify your experience with features like ID scanning and auto-population.

Engage Members With Confidence

Stronger relationships start with building financial confidence during life’s pivotal moments. Supporting your members through transitions can drive acquisition, digital adoption, and increased share of wallet.

Key moments to support members through include:

• Starting a family

• Opening a business

• Getting married

• Changing jobs

• Retiring

• Making major purchases

• Facing health challenges

• Coping with loss

While people have multiple financial relationships with financial institutions, many still seek advice and lack confidence in their financial lives. Build trust when it matters most by offering relevant, easy-to-access resources to help them become more financially healthy.

Solving Financial Fragmentation

The average U.S. adult uses 15 to 20 financial apps, making it difficult for your credit union and your members to get a full financial picture. With a mature data strategy – powered by open banking and APIs – you can harness real-time data, eliminate silos, and deliver a unified experience that empowers your members.

By aggregating financial data from third-party sources, you’ll enable your members to securely see their accounts across multiple financial institutions in your app.

Protect Your Members’ Financial Lives

As fraud threats escalate, pairing convenience with robust security is essential. Implement layered fraud prevention – including AML, OFAC screening, and identity verification – within your digital experience to protect your members.

AI-driven fraud detection and real-time monitoring strengthen protection without compromising member experience. You can improve investigations, reduce losses, and adapt to evolving threats by utilizing modern fraud platforms that are cloud-based, powered by AI and machine learning, and built on open architecture.

Build trust and loyalty by empowering your members with real-time alerts, secure messaging, and card controls.

Drive Growth Through AI

In the 2025 Strategy Benchmark study, credit unions identified digital banking and back-office automation as top investment priorities. With AI, machine learning, and enterprise workflow tools, you can do more with less – reducing manual, error-prone processes and lowering non-interest expenses – and enhance your digital front door.

AI can also be a catalyst for engagement. Conversational banking, powered by AI, is transforming how people interact with businesses. You can deliver intuitive, secure, in-app experiences to reduce friction, improve satisfaction, and build lasting trust. Additionally, AI and AI-assist capabilities can enhance speed and service.

Key Digital Experience Takeaways

To stay competitive, you’d be best-served by a digital banking platform that is cloud-based, real-time, and open – and ready to integrate, scale, and adapt.

Delivering seamless experiences that reduce friction and increase engagement is no longer optional – it’s essential. And it all begins at your digital front door. Explore new resources that are available to help.