The following post is provided by Co-op Financial Services, a financial technology organization supporting thousands of credit unions in the United States, and an associate member of World Council.
As daily life under COVID-19 continues to change, credit unions should prepare for long-term changes to member behavior.
With members taking to new banking channels and adjusting their spending behaviors, credit unions can design products and experiences that support their members’ lifestyles now and after COVID-19.
Looking at member behavior leading up to and throughout COVID-19, here are four key areas every credit union should focus on:
1) Immediacy and Digitization
It is no surprise that digital payments have surged throughout COVID-19. A PYMNTS study found that online shopping during COVID-19 has increased 35 percent compared to last year. With that spike in usage, members will now have higher expectations around the digital experience. Namely, that it is fast and friction-free.
Zelle has reported double-digital increases in enrollment during COVID-19, as more consumers use the service to send money to family members and friends and reimburse them for canceled events. The ability to instantaneously send or receive money will become an expectation among the digital consumer and offering that capability will also help you build frequent touchpoints with your members.
Members will also be looking for innovation within your existing digital tools to make their lives easier. Whether it’s enhanced mobile banking features or budgeting tools that help members better control their spending, credit unions should focus on improving their products’ usability and stickiness to increase engagement. One way to do that is through journey mapping your digital experience. Another is to leverage APIs (like the ones available through the CO-OP Developer Portal) to push out new features that enhance the digital experience quickly.
2) “No-Touch” Experience
Contactless payments will be another critical channel beyond COVID-19. We’ve already seen demand for contactless skyrocket – 27 percent of U.S. small businesses reported increases in contactless usage and transaction volumes at stores and ATMs are expected to continue to jump 10 to 20 percent as a result of the pandemic.
To maintain top-of-wallet status across contactless, credit unions should invest in three key areas: digital wallets, contactless plastic and digital issuance. Digital wallets and contactless cards allow you to offer members a faster, more secure payments experience both online and for POS transactions. Digital issuance (coming soon to CO-OP), allows you to immediately activate your cardholders to begin making digital payments before receiving their physical cards. It also ensures that your members are still able to make payments in the event their card is lost or stolen.
3) Control and Communication
Security is always paramount within the payments experience but as more members shift to online and mobile payments and their spending patterns change, the risk of card-not-present fraud is now higher.
Putting card controls into your members’ hands s more important than ever because it empowers them to monitor and control their spending while also protecting their cards when not in use. Simultaneously, encouraging your members to utilize fraud text and alerts keeps them engaged with their credit and debit spending and with your credit union.
Finally, now is the time to consider bolstering your fraud mitigation efforts by leveraging big data and machine learning to predict fraud more accurately.
4) Always-on Service
The quality of your service, particularly as physical interaction with members remains significantly limited, will determine how members perceive and build trust with your credit union.
Credit unions can meet that expectation by ensuring that members have access to the tools and support they need at all times and that the service experience is consistent across every channel. That means equipping your Contact Centers to handle increased call volumes and training service agents to engage with distressed members. It also means ensuring your backend operations, whether its cardholder maintenance or disputes and chargebacks are optimized to provide speedy resolutions to member pain points.
Where do we invest in the future?
While the COVID-19 crisis continues to evolve, we already see new opportunities and challenges in the tailwinds. Addressing these four areas of the member experience is critical, ensuring you have a strategic blueprint for long-term growth.