The Core Players In Credit Union Land

Callahan's annual core processors market share guide offers who’s who and what’s up among providers of the most critical of technology infrastructure.

Industry consolidation is driving down the number of credit unions even as the movement’s engagement with the American public just keeps growing. Still, long-standing trends are continuing in the core processing space, and Callahan’s annual Market Share Guide: Credit Union Core Processors once more offers industry-leading data and insight from credit union and vendor experts alike.

The tables and graphs contained with the Market Share Guide will help decision-makers assess where their current core provider — or others they might be considering — stands in the industry and among its peers. That includes market share data by provider and platform as well as Platform Profiles that dig deep into aggregate overviews of select providers accompanied by minimum, average, and maximum financial performance metrics for credit unions on their respective cores.

Staying current with financial technology is essential to providing the kinds of services members demand. Choosing and converting platforms can be arduous, and making the most of the features and capabilities of a current system or other alternatives is a continuous process. This year’s guide includes insight from industry leaders on those topics and more.

Symitar Rebrands While The Giants Remain Just That

Perhaps the biggest news in core processing in the past year is the August announcement that Jack Henry & Associates has consolidated its three industry brands — Jack Henry Banking, ProfitStars, and Symitar — into one brand: Jack Henry.

The Episys name is being dropped and the credit union platform will simply be known as Symitar. Brand names aside, it remains a major player, combining with Fiserv to claim 39.4% of the credit union market by number of clients.

Fiserv actually lost 51 basis points of market share from 2021 to 2022 but remains the market leader, with a share of 28.9%. At this writing, 1,432 of the 4,957 cooperatives represented are on Fiserv platforms.

Jack Henry grew its share by 15 basis points over the same period, but its 522 clients include 185 institutions with more than $1 billion in assets. That’s eight more than last year. Fiserv, meanwhile, added two and now has 158 that top the $1 billion mark. In the $250 million to $1 billion segment, Jack Henry holds a close second at 211 to Fiserv’s 228 credit unions. Fiserv also leads the market in clients in every other asset band.

The Momentum Leader Among A Shrinking Market

Corelation reported the most significant client growth in 2022, adding 23 new users to its KeyStone platform. That pushed the company’s roster to 145 credit unions and increased its market share by 55 basis points to 2.9%.

There were only four new credit unions joining the movement in 2022, and the total number of active shops fell by 179 during the past 12 months to dip below the 5,000 mark at 4,957 as of June 30, 2022. Fiserv was the core processor of record for 25.7% of those 183 credit unions lost to mergers or closures in the past year. But the global financial services technology giant still has 1,432 credit unions on its cores, by far the most of any individual firm.

Eight out of the 29 cores with client lists totaling at least $400 million in assets gained clients year over year; 16 lost clients, and five maintained their number of users.

The Platform Players — The Episys Name Leaves A Leading Legacy

The Episys name is no more, but in 2022 it remained the leading single platform, with 689 credit unions across three providers — Jack Henry (522), Member Driven Technologies (99), and Synergent (68). In total, 13.9% of credit unions in the country use that system.

Meanwhile, Platinum, FedComp’s platform, came in second, with 468 total credit unions and a 9.4% market share. That marks a decline of 37 clients during the year as the presence of very small credit unions — this venerable company’s market — continues to fade. There also are 19 fewer users of Finastra’s UltraData platform.

On the plus side, the CU*BASE platform gained 35 new users, the most for any single platform over the year.

Credit Union Core Engagement In A Dynamic Market

Although the number of credit unions continues its decades-long decline, some key measures of the industry’s health just keep hitting new highs. Shares, for instance, increased $140 billion, or 8.1%, from $1.7 trillion as of June 30, 2021, to nearly $1.9 trillion as of June 30, 2022. Loans were up $194.5 billion (16.1% ) from $1.2 trillion to $1.4 trillion during the same period.

And perhaps most importantly, the number of members increased by 4.2% from June 30, 2021, to June 30, 2022, adding 5.4 million in a single year to reach 133.9 million. The industry must be doing something right as it sticks to its core values while responding to new fintech imperatives.

Indeed, the explosion of digital and mobile banking and payments hasn’t changed an essential dynamic: the core platform’s essential role as the central repository and transactor of data needed to meet daily banking needs.

That platform also is typically a credit union’s largest expense after personnel and physical space. In the Market Share Guide: Credit Union Core Processors, credit union leaders can find data-driven information and insights they need to assess their current provider, consider the competition, or both.

To learn more about the core provider landscape, contact Callahan & Associates and ask how you can gain access to this year’s Market Share Guide: Credit Union Core Processors.

December 5, 2022

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