It’s never been a secret that the world is turning digital, but the COVID-19 pandemic has exponentially increased the pace at which that’s happening. In what felt like a split-second, COVID-19 forced the adoption of online and mobile; createda tipping point for digital and contactless payments; and hurried along the evolution of the underlying market structure.
In 2017, the United States saw the promise of real-time payments and P2P was just starting to pick up steam. Over the next couple of years, credit and debit cards continued to be the mainstay for payments, and bill pay continued its growth with the introductionof items like eBills. Then 2020 came along and supercharged payments in a way the industry had never seen before.
During COVID-19, the industry has seen 35% of consumers increase their online banking usage. Mastercard reports more than 40% growth in contactless transactions during the pandemic; and in the first quarter of 2020, Visa saw more than 13 million customersin Latin America make their first-ever online transaction.
Digital Is Here To Stay
The digital trend doesn’t seem to be going away. Of the 48% of consumers who have shifted their shopping online, 86% intend to stick with those experiences and 63% plan to maintain at least some of those digital behaviors. And as Americans continueto avoid cash and point-of-sale (POS) terminals, it’s not surprising that 60% of consumers expect merchants to offer a way to pay in-store without interacting with a card reader. In fact, McKinsey & Company estimated classic POS payments volumes could drop by as much as 30% to 40% in the short term (especially with foot traffic down by more than 70% for retailers at the beginning of the pandemic).
Even before the pandemic swept the nation, developing a seamless digital experience that resolves a member’s need the first time around, without the need to call or visit a branch, was imperative for any institution. Digital must be a focus thatreaches across the entire credit union. Future needs won’t be satisfied just through online and mobile.
For credit unions, digital growth is about embracing the Modern MemberSM buying journey for financial products. (Pre-pandemic, 87% of consumers began their journeys online which is a jump from 71% in 2017, meaning the trend is moving onward and upward.)
Next Steps: Accelerate Your Digital Transformation
As we see the world move toward invisible payments and watch fintechs like Varo and Square enter the traditional banking space, making sure credit unions are top-of-app and top-of-wallet will go a long way toward increasing payments revenue and maximizingdeposits. Credit unions can achieve this by:
- Using scalable payments solutions that simplify the complex payments transacted in traditional, digital, and emerging channels.
- Offering and educating members on mobile app-based solutions like remote check deposit, bill pay, and contactless payments.
- Partnering with a technology provider that supports open banking, meaning you can find and implement integration opportunities that are in your best interest.
- Taking a platform approach to your core technology so you can streamline all of your member touchpoints and digital channels from your lending experience to your mobile app.
- Using a core platform customization solution to modify your core to fit your needs, like integrating data from multiple sources and developing interfaces with other systems.
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From leading core, digital, lending, and payments capabilities to a truly open approach of working with credit unions, Symitar is your human-centered, tech-forward partner. We offer a comprehensive, integrated platform to help you achieve your goals.Together we serve the Modern MemberSM and advance the value and importance of credit union membership.