By W.B. King
For this year’s annual Finopotamus “Holiday Tech Wish List,” we sat down with forward-looking fintech executives who shared respective tech hopes as well as forecasted market realities for 2023. Due to a significant number of intriguing responses, the Wish List will be presented in three installments. Here goes Part 2.
Wishing to Keep Compliance Top-of-Mind
As more and more credit unions focus on delivering products and services digitally, CUNA Mutual Group’s Director, Financial Institution Management, Compliance Systems, Carrie Goodman’s wish is that compliance be a cornerstone of every credit union’s transformational efforts.
“Consumers today may begin a transaction as a digital experience by selecting an online account or completing an online loan application, but often that’s where the digital experience ends,” she told Finopotamus.
“Compliance is a critical part of the last mile, that final stretch of the customer experience, and that’s where an organization’s investment in their mobile experience (or lack thereof) becomes apparent to the member,” she continued. “These days, it’s critical that compliance content be designed for mobility — not to fit pages coming off the branch printer.”
The Madison, Wisc.-based CUNA Mutual Group is a mutual insurance company providing financial services to 3,768 credit unions, their members, and other customers worldwide.
In Goodman’s view, consumers shouldn’t have to “pinch, zoom, squint, and reorient their devices” to read and comprehend disclosure agreements.
“That language they receive should be written in consumer-focused, consumer-friendly terms,” she said. “Credit unions that consider the end-user’s needs first and invest in technology that meets consumer demand for mobility while keeping compliance top-of-mind will build trust and deepen the relationships they have with their members.”
Since wishes aren’t always easily granted, Goodman said credit unions have to be proactive.
“The biggest challenge financial institutions will face when implementing mobility-focused compliance solutions will have to do with change management,” she said. “Adapting to change is not easy, so credit union leaders need to get employees excited about the digital transformation and the benefits for employees and members that will come along with it.”
Instead of trying to fit “old processes into new technology,” Goodman said credit union leaders need to “identify stakeholders who will embrace the change and act as champions for the initiatives and projects when it comes to implementing new technology.”
As she looks at the 2023 credit union landscape, Goodman hopes credit unions will continue to gain momentum in respective digital journeys, while focusing on user-experience.
“They should consider how they can implement change that supports how their members want to bank, where they want to bank, and how they want to communicate,” she continued. “And they should explore technology that delivers that experience without compromising their compliance standards.”
Wishing for Enterprise-Side Open Banking
Slaven Bilac, CEO and co-founder of Agent IQ, told Finopotamus that credit unions are “being held hostage” by core and other legacy platforms that control their data — not making it easy or “financially affordable” to access it. As a result, his wish, in part, is for enterprise-side open banking.
“There is a lot of progress being made with traditional open banking and the value it adds for members,” he said, noting that “legacy” IT behavior has to cease. “Data should be readily available for the owning institution to use to enhance their member experience and offerings.”
The San Francisco-based Agent IQ, which has two credit union clients, offers its Lynq digital engagement platform that allows consumers to select and engage with a personal banker for all their financial needs across any digital channel.
Conceding that his wish couldn’t be fully implemented in the coming year, Bilac said progress, which would be “enormously valuable,” can be made.
“The headwinds that will be faced, however, is the fact that core and other data warehouses have a strong incentive to not lose their leverage by controlling this data,” he said. “Other concerns like security and compliance are factors, but fairly easy to address and overcome.”
After a long period of “being flush with liquidity during the COVID years,” Bilac said credit unions are currently“feeling the crunch of the opposite.” This reality, he added, presents challenges for “hiring and ultimately providing the member experience that they are known for.”
Building on his wish, he hopes that in 2023 credit unions “find the right partners and tools so that they can provide a greater service and deliver more with the tighter resources that they are being forced to have right now.”
Wishing for Credit-Based Tech-Tailored Experiences That Meet Individual Requirements
Knowing all too well that speed is critical when providing loan and credit to consumers, Equifax Verification Services Sales Director Alison Heller’s wish is for the industry to continue developing and implementing technology solutions that help credit unions understand members’ needs. This requires an “IT infrastructure that is fast, secure, and reliable,” she noted.
“Provide consumers with tailored experiences that meet their individual requirements,” Heller told Finopotamus. “This means using technology solutions that deliver quick and trusted analytics and insights to meet the specific needs of each customer segment.”
Headquartered in Atlanta, Equifax’s Verification Services offers a solution for verification of employment, income, identity and assets.
Heller, a proud credit union advocate and “fraud fighter,” believes her wish is within reach.
“The industry is prime and well-positioned to implement new and existing technologies to better streamline lending.”
In the coming year, she said technology will continue to play an “increasingly important role” in how credit unions operate — from automatic payments to remote banking options.
“Credit union leaders must stay on top of new technologies if they want their institutions to remain competitive with traditional banks,” Heller continued. “We hope that by 2023, all credit unions will have adopted modern technology solutions so they can stay ahead of their competition and provide better service for their members.”
Wishing Credit Unions Recognize the Power of Embedded Fintech
As Asa Technologies, Corp.’s CEO and Founder Landon Glenn sees it, credit unions will continue to face “thinning margins, skyrocketing member expectations, quickly evolving technology and an increasingly competitive marketplace.” To this end, he told Finopotamus that his wish is that more credit unions will recognize the power of embedded fintech.
“Credit unions are being challenged with how to retain relevance and prominence in members’ financial lives,” Glenn said. “Embedded fintech can help fill this gap, extending their brand and presence into everything members do in e-commerce.”
The Provo, Utah-based fintech, which counts 10 credit unions as clients, connects financial institutions with vetted fintechs for end users in a secure, compliant and easy to implement marketplace.
Noting related challenges, such as the need for credit unions to “reimagine” how they have traditionally viewed fintech partnerships, Glenn feels optimistic that his wish will come true.
“A collaborative banking model contractually prohibits the fintechs from competing with credit unions; they can’t offer checking accounts, cards, or loans,” he continued. “Instead, they share leads back to the partner credit unions that can in turn provide all of the banking products and services needed. This model has many benefits, but it does require a notable mindset shift.”
For Glenn, the goal of any credit union-fintech partnership is perpetuating a member’s financial empowerment.
“Credit unions have an opportunity to be at the center of providing members with control of their data, while allowing them to securely connect with technology that meets their specific needs,” he said. “The future of financial empowerment and data sovereignty involves letting members select, instantly register for and authenticate apps that meet their individual needs and securely link their accounts without ever giving fintechs access to any personal information.”
Credit unions, he added, can be at the “center of this empowerment, ultimately providing members with easier, wider and risk-free access to the tools necessary to advance their financial health and education.”
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