Credit Unions Set Sights on Financial Wellness for 2022

For credit unions, helping consumers achieve financial wellness will be top-of-mind in 2023.

But as Yvonne Stelpflug, senior vice president of Advisors Plus Consulting at PSCU, told PYMNTS, CUs will need to grapple with any number of challenges of their own as they seek to help end users navigate macro-economic pressures.

Coming through the pandemic, there have been all kinds of angles, and twists and turns, she said, adding that “it’s tough to keep up to speed with all of the moving parts.”

In many cases, she said, CUs struggle to introduce new products and services and fend off competitive challenges from deeper-pocketed, larger, rival financial institutions (FIs). Add in inflation and rising interest rates, she said, which pressure margins — and the possible loss of interchange revenues — and there’s no easy path for forward-thinking CUs. But one thing’s certain: They can’t rest on the laurels of simply having launched a digital app and some basic features and functionalities.

Competitive Pressures

The big banks, and even FinTechs, said Stelpflug, are seemingly making changes to their apps every month.

“They’re refreshing, retooling and making sure that they’re connecting with the consumer in the ways in which that they want to connect,” she told PYMNTS.

But CUs have a strategic advantage that lies with being able to capitalize on the deeply-rooted relationships they have with communities and individuals — and establishing themselves as the preferred providers of ways and means of helping reach financial goals.

“The digitalization and personalization aspects may be key,” she said, “but clients still want to be connected and to make sure that someone is looking out for them – and evolving with them.”

Key ways in which CUs can do just that, she said, include helping individuals and families build and maintain good credit profiles. The widespread embrace of buy now, pay later options has given FIs and credit unions, in particular, the opportunity to coach members on how to access funds and to layer in new underwriting and lending solutions to help “graduate” into new financial options.

The wealth of descriptive and predictive data that flows across CUs’ systems and the deep relationships with accountholders means they can play a vital role in ensuring that members do not wind up in financial distress in the current, uncertain economy.

“CUs can help ensure that smart decisions are being made, that risk is being averted and that there’s always an opportunity to reach out and be proactive,” she said, as people move through various stages of life. That same data can help CUs stay engaged with members across digital and brick-and-mortar settings.

“You’ve got to be able to feed into what’s happening with members — so that the digital solutions, the contact centers, the tellers and lenders all have access to the same information,” she said. The cross-channel data flows can help track when members start a loan application online — but don’t finish it — which can hypothetically open up a conversation about financial goals the next time they visit a branch.

Harnessing the correct data at the right time and focusing on the member’s journey, she said, “helps the CU become more efficient and creates the experience that members want.”