The New Digital Lending Playbook for Credit Unions
With the rise of online lenders, credit unions will face an even more competitive environment as loans are taken off paper and into the digital space.
The emergence of digital lenders has introduced new competitive factors that place greater pressure on credit unions to keep up with both market trends and consumer expectations. That being said, opportunities abound for credit unions to carve out a presence in the digital lending space.
The newest report from Filene Research Institute, sponsored by CU Direct, stresses that rather than a “one-size-fits-all digital lending strategy,” credit unions should steer clear of competing digitally head-to-head with online only lenders, and instead consider a comprehensive “digital playbook” that taps into their current strengths, while also tackling their weaknesses.
The Federal Reserve has estimated that there is currently $3.54 trillion of consumer loans outstanding, of which credit unions hold roughly 10 percent. The new lending experience will be paramount in consumer’s decision making. Ease of use, fast decisions and availability of funds will all be the new heavy-hitting factors in the lending arena.
Filene’s research indicates that in order to maintain market share and boost competitive advantage, credit unions will need to move away from various manual touch points and incorporate digital access. The report explores the current thinking of credit union leaders as it relates to digital banking in general and digital lending specifically.
Filene notes that credit unions should consider incorporating a digital playbook that taps into their current strengths, and details the strategic advantages of planning and executing on five specific crucial ‘digital plays:’
- Attitude is Everything
- Know What’s Important
- Frictionless Lending: A Real Help or Potential Pitfall
- Human Touch vs. Digital Touch
- Integration is Not an Afterthought
Read the full Digital Lending Playbook report, to discover the keys to equipping your credit union with the digital plays necessary to plan, implement and effectively navigate the digital realm and successfully compete in today’s changing marketplace.