Credit Unions and Covid
Wrapping Up Experiences and Designing New Strategies
We are experiencing history in the making and we get to be in the drivers’ seat. Just think, fifty years from now, when students are learning about digital evolution they will read about the worldwide pandemic of 2020 and how it shifted all generational consumers to go digital.
As a result of COVID-19, many members could no longer walk into a branch and they had to rely on their financial institutions’ digital channels for their banking needs. Baby boomers (born 1946 to 1964) were forced to learn how to log into online and mobile banking to access their accounts and perform transactions. And that is when the cultural shift pushed the limits of the bell curve! Baby boomers began showing their grandchildren, the Gen Alpha’s (born 2013 to 2025) the convenience of banking online. We began to see Baby Boomers performing person-to-person payments and transferring funds electronically into their child and/or grandchild’s digital wallet with emoji’s! And now that consumers see how easy and convenient it is to deposit a check just by taking a picture or how quick they can freeze and unfreeze their debit card with just a swipe to the left or the right, it will be difficult to go back to their old habits of walking into a branch or calling an 800# to check their balances or report their card lost or stolen.
Digital Storefront - Nimble Development & Thinking unconventionally
During COVID-19, VisiFI and its customers saw a 28% spike in online and mobile banking users. According to a recent survey held by Strategic Resource Management (SRM) published within CUInsight, in August, 2020, they found that digital growth was well above the pre-pandemic norm where “62% of responding financial institutions noted an increase in digital users between 10 and 25%” and “11% stated this growth exceeded 25%.”
This surge of digital demand has caused financial institutions to shift their focus to digital member experience. Credit unions began investing in more digital products to better serve their members and put more time in developing and crafting the member messaging and communication across the digital channels.
Our focus was already on digital transformation, but COVID-19 required us to move much faster than we ever had in the past. Consumers relied on their financial institutions to roll their sleeves up and help humanity bring the credit union brick and mortar storefront into the digital storefront. And that was our goal.
We began working alongside credit unions and developing solutions centered around people helping people. In the middle of the pandemic, businesses and consumers partnered together to create products and services that were needed causing us to think differently and unconventionally than we ever have.
- How do we provide cash back incentives and unique savings programs that can help consumers during these difficult times?
- What measurements can we put in place to allow members to do more digitally while still providing a secure platform?
- How to we create more real-time channels that provides instant access to send and receive funds more easily?
- What digital products can help members transact business with their phones and limit touching anything to reduce the risk of getting/spreading the virus (i.e. avoid touching ATM screens, PIN-Pads at merchants, etc.)?
Digital transformation was evolving faster every day and digital payments was a big component of it. Due to safety reasons, consumers were moving away from cash transactions (to reduce potential exposure of the virus) and moving towards contactless cards and other digital payment methods. In parallel, due to the uncertainty of the economy and the longevity of the pandemic, members were also moving to more conservative spending. VisiFI and its financial institutions saw a 7% increase in debit card usage, consistently each month from April 2020 through September 2020 while credit card usage decreased an average of 9%.
“Both Visa and Mastercard saw a worldwide debit volume growth of about 20%…credit is down about 5% to 10%” MarketWatch, reported October 30, 2020, citing MoffettNathanson analyst, Lisa Ellis.
Personalized Digital Experience
It’s Simple. It Pays. became our new motto. We married the evolution of our digital banking application with advancements to digital payments while thinking unconventionally. Our first initiative was partnering with an international company to offer cash back to members that used their credit union debit and/or credit card. As you can imagine, the challenge was that credit unions were losing income due to the pandemic and could not afford to invest in a rewards program. As a result, VisiFI formed a partnership with Prospero Pay to create a win-win for everyone providing a free reward system, at no cost to the credit union. Prospero Pay works with over 250+ national merchants across the globe. The merchants pay Prospero Pay a percentage of sales with each transaction. To drive members to those merchants, we built a system where members can use their credit union debit or credit card to make a purchase at those merchants and receive the % of cash back instantly! Everyone wins.
- Members are encouraged to use their credit union debit card and they receive free cash back with qualified purchases.
- Credit union benefits because their debit card is top of wallet, allows them to offer a rewards program and doesn’t cost them anything.
- Prospero Pay receives payment by the merchants and can drive more business to them. At VisiFI everyone receives this service as part of our digital banking solution!
This model met many of our goals we set.
- Ability to provide cash back incentives
- Created a unique savings program to help consumers during difficult times
- Created a real-time channel to send/receive funds more easily
- And, the member paid using a QR code within online and mobile banking! Yes, it is touchless!
We then added new card controls such as the ability to setup debit card alerts, spending limits and of course the ability to watch your cash back savings grow with each purchase! People helping people. It’s Simple. It Pays.
This is just one of the many ways we modified our vision and roadmap to meet the ever-changing needs of the consumer. The COVID pandemic is helping to shape new digital strategies and teaching us to think and react in new and innovative ways.
In particular, our ability to proactively put in place new solutions for this new era is due to the fact we’ve been pioneering online and mobile banking solutions, and that is why today these are incorporated within our core technology platform.
This approach not only resulted in VisiFI’s capability to go beyond Credit Unions’ expectations during the pandemic, but it also resulted in the ability to put in place a better foundation for the future, as this will become the new normal.
In the end, going digital is easy if you can leverage a core technology platform that has the data and can turn that data into knowledge. Working alongside Credit Unions and providing innovative and unconventional user experiences is critical and its success is when you have the correct information all along the process.
Delivering on Member Expectations:
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