The rise of the digital experience is among the most important post-pandemic changes overtaking most industries, including banking. With Millennials and Generation Z as the dominating demographic, banks and credit unions are resorting to digitization as a key strategy for existing and new members. In 2019, only 47 percent of Millennials and 54 percent of Generation Zs stated they would pursue a better digital banking experience even if it meant switching their primary account. A year later, the statistics exceeded 60 percent for both age groups. Similarly, two-thirds of consumers previously indicated they preferred making deposits or withdrawals at bank branches rather than online. Today, consumers conduct almost 70 percent of deposits by relying on self-service options instead of bank tellers. This significant increase demonstrates the pandemic’s overwhelming impact on the banking industry.

1. Credit Unions Shift to Digital
Griffin McGahey

2. Introduction
The rise of the digital experience is among the most important
post-pandemic changes overtaking most industries, including
banking. With Millennials and Generation Z as the dominating
demographic, banks and credit unions are resorting to
digitization as a key strategy for existing and new members.
In 2019, only 47 percent of Millennials and 54 percent of
Generation Zs stated they would pursue a better digital banking
experience even if it meant switching their primary account. A
year later, the statistics exceeded 60 percent for both age
groups.

3. Similarly, two-thirds of consumers previously indicated they preferred
making deposits or withdrawals at bank branches rather than online. Today,
consumers conduct almost 70 percent of deposits by relying on self-service
options instead of bank tellers. This significant increase demonstrates the
pandemic’s overwhelming impact on the banking industry.
Before the pandemic, banks were slowly incorporating the digital experience
into their operations, but the process was not a priority - full digitization was
expected to occur over three to five years. The current pandemic
environment paints a wholly different picture, with the majority of banks
and credit unions now pushing toward digital adoption.

4. Today, most clients have become familiar with Internet banking services
such as electronic bank statements and online transactions. Considering that
younger demographics prefer digital experiences, credit unions have set
their sights on enhanced digitization efforts to better serve their current
members, as well as attract new ones.
Planning and executing a digital banking strategy is key. Credit unions can
utilize member data to create a personalized banking experience which
improves member engagement. Additionally, a responsive, mobile-friendly
website is essential. Without an accessible and smooth user experience,
members can quickly lose interest in credit union communications.

5. Important features such as the centralization of member preferences and
settings can help improve the user experience. Credit union members are
keen on a consistent online experience, therefore settings related to
authorizations and password management are crucial and require real-time
processing.
Furthermore, digital communication archiving is a useful feature that many
members value. Ensuring there is a well-established archive for notices and
statements reassures members they can always access past notifications or
transactions without resorting to paper-based operations.

6. A strong digital strategy contributes to member retention and growth. In
2020, 43 percent of credit union members did not renew their membership
due to lack of engagement. To maintain member retention, credit unions
can integrate digital methods to address this challenge.
Credit unions can also attract new members by prioritizing the digital
experience. Millennials are currently the largest adult generation in the
United States. To appeal to the digital natives, credit unions can enhance
their online operations to stimulate member growth.

7. In August 2021, Sterling Heights, a financial credit union based in Michigan,
partnered with global enterprise technology provider NCR Corporation as
part of its digitization process. NCR aims to create a digital banking platform
to improve the digital experience for Sterling Heights members. By using
the new platform, members will gain access to advanced features including
credit monitoring and money management tools.
Other credit unions are taking similar steps. TruMark Financial Credit Union
also selected NCR to lead its digital transformation. Although initially
TruMark only tasked NCR with developing ATM-based self-directed banking
services, it recently announced that it will also integrate NCR’s digital
banking platform to improve its member experience.