I grew up in central Washington and later moved to Seattle. Credit unions were all around me, yet I didn’t join one until my late twenties. Why? Because no one in my peer group talked about them, and digital banking convenience was all I cared about. Big banks had already mastered that, and they were ready for us.
That’s the reality credit unions face today. I’m 29 — a “Zillennial,” born in 1996, straddling millennials and Gen Z. My first phone was a pink Motorola Razr flip. I watched dial-up give way to broadband, then smartphones, and now AI. I’ve lived through every stage of the digital transition, and my expectations — and those of my peers — have been shaped by technology that adapts seamlessly to our lives.
The Internet Caveman And My Daughter’s Future
I joke that one day I’ll tell my daughter I was an “internet caveman.” Before AI, I had to type a question into a search bar, click through half a dozen sources, and piece together an answer.
Then came Google Gemini’s AI summaries. I didn’t ask for it. I didn’t expect it. But once it appeared, it delighted me so completely that I adopted it instantly — and suddenly, Google had my loyalty. I had bounced between search engines before — Google, DuckDuckGo, others — but this one experience of seamless usefulness created stickiness overnight.
That’s the essence of easy technology adoption: When something works so well and feels so natural that people don’t need to be convinced. They just use it — and they don’t go back.
That is what credit unions must provide if they hope to retain the next generation of members.
A Generational Warning
The statistics are clear. According to McKinsey, only 31% of credit union members are millennials or Gen Z. Nearly 70% of membership skews older, heavily toward baby boomers, who still account for about 39% of members.
At the same time, the NCUA reports that over half of federally insured credit unions lost members year-over-year in 2024. Membership isn’t just stagnant; for many institutions, it’s shrinking.
And the demographic cliff is coming fast. Baby boomers still control the majority of U.S. wealth, but over the next two decades an estimated $84 trillion will transfer to millennials and Gen Z, according to Cerulli Associates.
The question is simple: when that wealth moves, will it stay in credit unions? Or will it flow into big banks and fintechs that already meet younger generations where they are — mobile-first, frictionless, and personalized?
Held Hostage By Legacy Cores
At the heart of this challenge is the core. Too many credit unions are still tied to technology designed for a world that no longer exists — systems that haven’t fundamentally evolved in decades.
Leaders know the frustration. Inflexible contracts. Long development cycles. Workarounds stacked on top of workarounds. The very systems designed to empower credit unions have become shackles.
Meanwhile, my peers almost never visit branches. Their financial lives happen entirely online, through apps that anticipate their needs. Every day they interact with companies that deliver seamless digital experiences. And when their credit union can’t do the same? They switch. Quietly, permanently, and without regret.
The Stakes: A Wealth Transfer Unlike Any Other
The wealth transfer isn’t hypothetical — it’s already underway. Millennials and Gen Z are beginning to inherit not just assets, but financial decision-making power.
If credit unions don’t modernize their technology now, they will miss this moment. Losing younger members today means losing the opportunity to serve them tomorrow, when they’re managing mortgages, retirement accounts, and small business loans.
Imagine trying to convince a 25-year-old to stick with a clunky app that doesn’t integrate seamlessly with the rest of their digital life. You don’t get a second chance. Once they’ve moved their money, they’re gone.
The Credit Union Magic — And Its Fragility
Credit unions are different. They’ve always been different. They sponsor the little league teams, fund scholarships, and stand by their members when no one else will. They’re guardians of their communities — steady protectors in a financial world too often dominated by profit motives.
But guardianship isn’t enough if the sword is dull. The magic of credit unions — their member-first purpose — is fragile if it’s not matched by the technology members expect.
Today’s “dragon” isn’t the big bank across town. It’s irrelevance.
Future Members. Future Ready.
The solution isn’t chasing every shiny tech trend. It’s building a foundation that allows credit unions to evolve at the speed of their members’ expectations. That means modular, cloud-native systems, open APIs, and the ability to integrate tools like AI, fraud prevention, and predictive insights without breaking the bank.
It’s also about something deeper: delight. Members don’t care whether it’s a “core upgrade” or “microservices architecture.” They care that their credit union is easy to use, available on their phone, secure, and anticipates their needs.
Think of my daughter’s generation. By the time she’s managing her first checking account, she won’t see any difference between talking to her AI assistant and talking to her credit union. That’s the level of seamlessness tomorrow’s members will demand.
Accountability For Leaders
I didn’t join a credit union until 26. If I had only judged on digital convenience, I probably never would have joined at all. And many of my peers haven’t.
But once I did, I saw what makes credit unions powerful: their ability to help people unlock opportunities, weather storms, and build futures. That power is too important to lose.
And here’s where the accountability falls:
If you aren’t challenging your core provider, you’re choosing stagnation.
If you aren’t evaluating alternatives, you’re risking irrelevance.
If your technology stack isn’t designed for the next 20 years, you’re gambling with your members’ trust.
This isn’t a plea. It’s a reality. The future of the movement depends on leaders making hard decisions now. Because if credit unions don’t modernize, they won’t just miss out on growth — they’ll lose an entire generation of members.
And once lost, that generation isn’t coming back.
Garrhett Petrea is vice president of sales at Vyrdia. He can be reached at gpetrea@vyrdia.com.
Vyrdia is reimagining core software for a new generation. Built to be cloud-native, flexible, and member-first, Vyrdia empowers credit unions to thrive in a digital-first era while staying true to their community roots.
