Nearly one-third of United States consumers own cryptocurrency, and consumers who own crypto consider it when making various financial decisions. For example, 45% of crypto owners keep accounts with financial institutions (FIs) that offer crypto products.
Our data show that cryptocurrency’s appeal to these consumers is very strong. They represent a key segment of mostly upper-income and younger consumers whose needs will become more critical for FIs — especially credit unions (CUs) — to address, making banking innovation necessary for all FIs.
“Credit Union Innovation: Bridging the Cryptocurrency Divide,” a PYMNTS and PSCU collaboration, provides insights from 4,282 U.S. consumers and 100 CU executives about CU members’ interest in cryptocurrency, why CU execs are bearish on crypto and how this disconnect affects member loyalty.
Some of our key findings include the following:
• While 3 in 10 U.S. consumers own cryptocurrency, nearly half who do not own it say a lack of knowledge holds them back.
PYMNTS found that nearly half of consumers say their main reasons for not using cryptocurrency have to do with their lack of knowledge about it and their distrust of it, suggesting that the more CUs and other FIs educate members and account holders about this form of digital currency, the more likely members will be to get in the game.
• One-third of consumers highly interested in cryptocurrency say they are willing to change where they keep their accounts to access innovative products.
Crypto’s appeal is strong enough to influence consumer behavior, with 33% of consumers highly interested in crypto willing to change their FIs for more innovative products, but just 45% of these consumers say their FIs offer crypto products and services. This willingness to switch FIs poses a dilemma for the CUs that have yet to roll out crypto products and services and presents an opportunity for the ones that offer these products to win new business.
• CU executives remain reluctant to provide innovative cryptocurrency products for members.
We found that 56% of CU executives say they are just slightly or not at all interested in providing crypto products for members. Among these executives, 66% cite crypto’s sharp decline in investment value in 2022 and its volatility as reasons for the lack of interest in the digital currency, and 43% expect demand for crypto to fade.
Despite CU executive’s expectations that demand will fade, PYMNTS found that member interest in crypto grew in 2022, and many consumers would switch FIs to gain access to more innovative products. As FIs do more to educate their account holders, interest in cryptocurrency and its usage may still expand.
To learn more about how CU and banking innovation, specifically with crypto products and services, can attract more consumers and increase member loyalty, download the report.