The race to future banking glory between banks and credit unions has the makings of a David versus Goliath contest. And the reason the credit unions are in with a chance is that the (American, but globally representative) millennials have leveled the playing field by proclaiming (in the Millennial Disruption Index study) among other things that one bank is pretty much like the other, that Google, Apple and Amazon are likely to come up with more exciting financial offerings than banks, and that they don’t really care about big banking brands.
Technology has leveled the playing field some more by fragmenting the banking market into little disruptive-innovation niches, and threatening to disintermediate banks from their own business.
Clearly, size no longer matters as it used to.
But before credit unions can sneak past the ruling champions, they will need to reinvent themselves for the digital age. Here’s a summary view:
While this may sound like a tall order for credit unions, most of whom still lag the industry in digital adoption and budgets, they can take confidence from the fact that they already possess some of the core values required to succeed in the digital age – they have always worked in the interest of their customers; they know what it is to be part of a larger community; and their intimate knowledge of customers is second to none. Read more in our recent survey report, conducted jointly with Cornerstone Consulting, about digital capabilities in credit unions