At a time when the cost of living is rising, debt is mounting, and economic uncertainty is pervasive, living a healthy life and achieving financial well-being is more important than ever. As of July 2024, an estimated 75% of Americans are struggling with their financial health. That’s where credit unions come in, playing a critical role in turning things around and building a future where financial well-being is at the core. By focusing on this, credit unions are not only helping their members – they are also increasing KPIs like member retention, deposit size, loan repayment rates, and overall trust and engagement.
Members First: The Unique Role of Credit Unions
Credit unions occupy a special place in the financial world. Unlike other financial institutions, they are not for profit, but rather have a mission to serve their members and help their communities because they are member-owned cooperatives. The unique “people helping people” mission and organizational structure means that credit unions are closely connected to the needs of their members, allowing them to focus on what matters most – offering personalized, community-focused financial tools, education and resources that help promote financial well-being.
What sets credit unions apart is their deep understanding of the communities they serve. Rather than offering one-size-fits-all solutions, they tailor their services to the individual needs of their members. Whether it’s helping someone manage their debt or building savings for unexpected emergencies, credit unions are prepared to help with the diverse financial challenges their members face every day.
Leading financial health through digital banking
As branch visits decline, credit unions have realized they cannot rely on face-to-face interactions to understand the ever-changing needs of their members. With members visiting branches less frequently, digital banking channels have become the preferred place for credit unions to connect with their members and develop solutions tailored to their individual financial situations. The key to success is turning digital engagement into meaningful experiences.
Credit unions are using digital innovations to make saving and financial management easier. One of the cornerstones of financial health is teaching people how to save regularly through small, healthy habits. Digital banking features like card round-ups for everyday transactions make it easy – purchases are rounded up and the extra change is automatically deposited into savings accounts. This is a simple but powerful way to encourage the member to save regularly with minimal effort.
Leading credit unions are going a step further and increasingly helping their members save for their short- and long-term dreams, whether it’s building an emergency fund or buying their first home, with digital tools. These digital tools offer a variety of saving methods, as well as visual feedback on progress and personalized tips, making it easier for members to stay on track and reach their financial goals.
Personalized member experiences for smarter decisions
Let’s go back to the “people helping people” manifesto. What really sets credit unions apart is their commitment to personalized service and deep community ties. Now, with the advent of financial wellness tools, they’re bringing that personal touch to the digital space. In today’s digital age, over 80% of people expect their financial institution to help them with their financial health, but only 14% of people feel like they’re getting the support they need. That’s where credit unions come in. Thanks to fintech integrations that leverage digital engagements, data, and AI, credit unions are now starting to offer automated, personalized financial insights. These insights provide members with tailored advice on how to reduce their spending, manage debt, and improve their credit scores. Through these digital experiences, credit unions are giving their members the information they need to make smarter financial decisions and feel more confident about their financial future.
Looking beyond key insights, credit unions today are helping their members become financially healthy by offering completely personalized financial products. By analyzing individual financial behavior and needs, they can offer customized loans, credit cards, insurance options and investment opportunities that are most relevant and beneficial to each member – all through a seamless digital experience.
How Fintechs Empower Credit Union Members
Fintechs are transforming financial wellness, and credit unions are at the forefront of this: integrating innovative solutions that make it easier for their members to save for their future and manage their finances. While implementing these technologies can be costly, many credit unions are already partnering with fintech companies to provide personalized experiences to millions of members.
These companies enable credit unions to effortlessly introduce new financial wellness and personalized banking experiences while reinforcing their shared mission of “people helping people.” These turnkey experiences are already fully embedded in leading digital banking platforms and can be deployed quickly with no development or operational effort. With such experiences, credit unions increase member deposits, improve member satisfaction, and foster a stronger sense of community and purpose.
Looking ahead: The future of financial well-being
As the financial landscape continues to change, credit unions are in a unique position to take on the responsibility of promoting financial well-being. With their focus on member-centric solutions, societal impact and digital innovation, credit unions are uniquely positioned to help their members achieve greater financial stability, strengthen the overall economy and, most importantly, stay relevant in a rapidly evolving world.
Credit unions are more than financial institutions—they are trusted pillars of the community, fully committed to the well-being of their members and the community as a whole. By continuing to expand their offerings and partnering with fintech companies like Spiral, a CUNA award winner (also known as America’s Credit Unions), credit unions that prioritize innovation and financial well-being can attract a new generation of members—and stay relevant. But leveraging digital experiences for financial well-being isn’t just about keeping up; it’s about building deeper connections with younger, more engaged members, strengthening communities, and reinforcing the “people helping people” mission every day through the digital banking experience.
