It’s Time for the Accelerator- NOT the Brake! - Blog

Please Wait a Moment



It’s Time for the Accelerator- NOT the Brake!

It’s entirely understandable for credit union leaders to feel overwhelmed these days. Consider the list of challenges they’ve had to overcome in real time, with little to no advance warning:

  • A decade-long economic expansion shifted into an unprecedented reversal
  • Branches, still a primary source of member engagement for most CUs (for better or worse), had to be shuttered
  • Call center member support processes required rapid retooling to accommodate remote working models
  • Drive-thru teller lanes experienced massive traffic spikes
  • Financially strapped borrowers began calling in huge numbers, requesting payment “holidays” and other assistance  
  • An unprecedented stimulus bill delivered ACH and check payments to most members, providing relief but leading to still more inbound questions
  • The Paycheck Protection Program provided a valuable lifeline to small business, but consumed a huge amount of bandwidth from CUs serving such members

Credit unions have weathered the storm quite impressively so far, but there’s hardly time to rest. As branches reopen, leaders need to sort through the security ramifications of a lobby filled with mask-wearing customers- a notion that would have been laughable three months ago. And sadly, with all signs pointing to a protracted recovery the loan delinquency and default challenges are likely just beginning.

With so many must-dos on their plates, CU leaders can be forgiven for a temptation to hunker down and focus on “the basics.” With interest margins squeezed, card revenue suppressed by lower spending and higher bad debt provisions all but inevitable, a variety of budgeted projects are likely to be in jeopardy. In the IT shop, this could put planned digital enhancements at risk.

Here’s the thing- digital is the one area where credit unions should be accelerating their initiatives, not succumbing to the short-term budget allure of scaling them back.

The logic is quite compelling: COVID-19 quarantines have created a dramatic forward jolt to digital banking adoption, particularly among the older cohorts typically viewed as digital laggards. Will some of these new adopters revert to old habits once branches reopen? Sure- but we’re not going all the way back, especially given the wider group now trained on these digital tools, with early research showing little dissatisfaction.

But here’s the real kicker- credit union member bases tend to skew older. This is also the group most susceptible to COVID-19, and therefore less likely to return to the branch anytime soon. At the same time, the younger demographics CUs need to attract cite digital capabilities as a key factor in FI selection. Whether it’s perception or reality (probably some of both), digital tools are considered a major gap between credit unions and the largest US banks consistently gaining market share.

If your credit union got ahead of the curve in offering state of the art mobile and online capabilities, congratulations- hopefully you’ve successfully communicated these enhancements to members and are realizing the benefits. Our digital endgame isn’t much different from the one envisioned pre-COVID; we’re merely now on track to get there faster. Credit unions cannot afford to arrive late to the finish line- if the pit crew is already juggling too many projects, don’t let digital be the one sacrificed.  Emerging from the pit at half speed won’t lead to victory.


Looking for an open exchange of credit union best practices for navigating COVID-19 issues? Check out BIG’s Digital Town Halls, held live each Wednesday. See for more info and to access past recordings.         


About the Author

Glen Sarvady

Glen Sarvady

Glen has 20+ years of FinTech experience, including leadership roles at industry heavyweights CheckFree, McKinsey and Deluxe. As a student he also helped launch a credit union at the University of Pennsylvania. Glen's firm 154 Advisors helps FIs and FinTechs navigate the rapidly evolving financial services landscape. His BIGCast episodes focus on payments issues, intriguing new products and industry hot topics. Follow him on Twitter @154Advisors 


The Importance Of Keeping Up With Technology For CUs

Channel optimization. Data management. Compliance and regulation. Cybersecurity. Aggregation service...

Read More >
Great CU Client Service Takes More Than A Smile

Great CU Client Service Takes More Than A Smile

Great client service is at the heart of every good business relationship, and credit unions depend a...

Read More >
Growth for Growth’s Sake!

Growth for Growth’s Sake!

Growth for Growth’s Sake is what every Credit Union should be seeking!

Read More >

Budget Season: What It Takes To Win Hearts, Minds, And Wallets

Through ups and downs, thick and thin, traditional and emerging schemes, one thing remains constant ...

Read More >
Lead Scoring – Getting to know your members

Lead Scoring – Getting to know your members

Many Credit Unions measure the success of a marketing campaign solely with “home run” metrics. For...

Read More >

Credit Union Members Win: Suncoast And SetIt Credit Team To Improve Cardholder Experience

Tampa-based Suncoast Credit Union and SetIt Credit are now working together to improve cardholder ex...

Read More >


7/6/2020 6:15:17 AM | Reply
7/6/2020 6:15:16 AM | Reply

Post a Comment