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Advocacy banking is at the heart of emerging tech: Incorporating emerging technology into the credit union space
This paper discusses the digital transformation that credit unions of various sizes, strategies and markets have embarked on. It considers this a business transformation journey, not just a journey of ‘digital technology’. While application programming interfaces (APIs), multichannel ecosystems and cybersecurity investments are several critical components arousing senior management’s attention, it is the blending of physical and digital that allows the credit union industry to retain the human touch. The paper proposes that in the light of the constant advance of emerging technology, it is imperative not only that an organisation’s strategy and culture support rapid technological change, but, even more importantly, that the technology is leveraged to better advocate for its members. Lower loan rates and higher dividend rates are staples for credit unions, but now those must be incorporated with ‘ease of use’, frictionless account opening and personalised digital banking experiences. The credit union industry was founded on the principle of ‘people helping people’; therefore, the biggest disruptor to the industry is not necessarily FinTech players, but rather a lack of vision to incorporate seemingly ‘radical’ technology into business plans and the requisite culture to allow it to thrive for the right reasons — member and employee centricity. The paper considers the three main challenges credit unions face in today’s environment, namely how to incorporate emerging technology into the businesses where diligent research and digital acumen are needed; how to create, sustain and thrive with a culture accepting continuous change; and how to tie the technology and people aspects of the business into a singular focus towards the goal of members’ financial success. This paper discusses how vital it is for a credit union to have a guiding vision, and to be grounded in essential principles to support technological change. It is incumbent upon credit unions to advance the digital relationship they have with their members, and to integrate the digital environment with the larger ecosystem that includes face-to-face interactions.
The full article is available to institutions that have subscribed to the journal