Looking for a way to enhance your credit union’s competitiveness and increase member satisfaction? Augmenting your strategic information technology foundation could be the missing ingredient to take your credit union to new heights.
We live in an era of digital transformation. Failing to stay up to date on emerging IT innovations could cost you members and revenue. At the same time, deploying new technologies without a solid strategy can negatively impact your budget and cybersecurity. According to Network Computing, only about 30% of digital transformation investments reach or exceed their goals. And, without appropriate risk mitigation measures, credit unions may be left open to cyberattacks. How can you strike a balance, maintain security, and increase your competitiveness?
In this article, we’ll walk you through the five foundational elements that every credit union needs to stay competitive and secure.
Understanding today’s credit union landscape
Despite economic uncertainty and looming threats of a global recession, Credit Union Times reports, “In 2023, only 7% of credit unions expect their IT spending to be lower [this year] than in 2022.” Further, 87% of polled credit unions “have launched a 2023 digital transformation strategy and 10% have plans to develop one as well – which means institutions that fail to innovate their technology risk falling behind and losing their competitive edge.”
It’s evident that small credit unions must invest in IT to stay ahead of competitors, but diving in head-first comes with its own risks. According to the Credit Union National Association (CUNA), “When credit unions move too quickly to keep up with competition, it may leave them more susceptible to cybersecurity risk. And if they move too slowly to keep up with competition, it may be too late to meet the consumer expectations.” So, how can credit unions embrace innovation without inviting additional risk?
Let’s walk through the five fundamental elements that every credit union should embrace when it comes to solidifying their strategic information technology foundation.
The banking industry as a whole is shifting away from legacy on-premises hardware and software. Instead of hosting a room full of servers at your credit union’s physical location(s), cloud storage offers scalable infrastructure that’s accessible from anywhere.
Legacy IT infrastructure creates silos between branches and departments, and it creates barriers when opening new branches or attempting to access information remotely. With today’s ever-growing need for mobile access and enhanced convenience for credit union members, cloud storage options allow you to offer a streamlined experience, more flexibility for employees, and improved scalability, all while building data resilience and enhanced disaster recovery capabilities.
2. Data backup and disaster recovery
From tornadoes to ransomware attacks, disasters are inevitable. But, with effective data backup and disaster recovery, credit unions can minimize losses and restore operations within hours instead of days or weeks after an incident. With the right data backup and disaster recovery strategy and infrastructure, credit unions can better protect member assets while minimizing operational disruptions and mitigating risk.
Effective governance includes strategic IT planning to ensure that your IT investments align with your organization’s short- and long-term objectives. With the right governance services, credit unions can rely on a trusted partnership to help navigate the various recommendations and regulations that impact banking organizations. A partnership like this provides access to a regularly updated technology roadmap so credit unions can ensure that they have the right technology to meet their needs, maintain regulatory compliance, and create effective internal IT policies.
In today’s IT landscape, cybersecurity isn’t a nice-to-have, it’s required. Credit unions must comply with NCUA regulations and federal and state laws around privacy and security. Failure to protect member assets and evaluate third-party risk could have legal and financial ramifications. Fortunately, with the right partnership, credit unions can address all of these potential vulnerabilities to provide the most secure experience possible to members while maintaining governmental compliance. Steps to take for enhanced security might include:
- Partnering with a dedicated cybersecurity team that can monitor endpoints and networks to ensure end-to-end protection at all times.
- Virtual CISO services to assist with regulatory compliance audits.
- Enterprise risk management services to ensure that appropriate policies, procedures, and controls are in place to mitigate risk across your entire organization.
5. Technology enablement
When competing against bigger credit unions and banks, you don’t want to waste time related to unnecessary manual processes, poor records management, and inefficient data collection and analysis. A variety of modern off-the-shelf or custom applications are available to help you in areas such as automation, business intelligence, and document management. Evaluating and implementing technology enablement options can be powerful investments—giving time back into the hands of employees, bringing data to life to help drive decisions, and organizing data more efficiently so that employees can quickly access important information.
Some innovative credit unions are also exploring virtual tellers and robotic process automation (RPA) to provide members a best of both worlds experience—doing their banking from home while getting the services of an experienced teller. As these member options increase in use, mobile will continue to be important—pushing credit unions to invest more in this side of their business. Not only are such innovations appealing to members but they also save employee time typically spent helping members with simple, repetitive tasks. To explore such innovations and set yourself apart from the competition, you need to make sure you have the right technology foundation, applications, and partner to ensure success.
Stay ahead of the competition with strategic IT deployments
Attempting to update your IT to keep up with other credit unions can feel like a daunting task. Instead of striking blindly, credit unions can get the most benefit (and the greatest competitive edge) by addressing five core IT elements. Each of these elements has a critical function for your operations, from security and compliance to streamlining member services. An effective IT strategy will include all five elements, working together to achieve your credit union’s goals.
Now is the time to implement an effective IT strategy to increase your credit union’s competitiveness. Reach out to us today to schedule a meeting with an IT expert.