As credit unions evolve to serve their members’ changing financial needs, payments are increasingly taking a critical role in the center of the member relationship. Whereas in the past, “passive” offerings like checking accounts and event-based loans defined the primary financial relationship, today consumers are gravitating toward those providers that offer “active” solutions to their everyday financial needs, with payments at the top of the list.
However, credit unions face stiff competition in this area from big banks and newer Fintechs. With limited time and resources to invest, they need solutions that help them achieve scale across their entire growth strategy, supported by a back-office payment infrastructure that enables them to serve members efficiently, conveniently and accurately.
Scaling the Time-Value-Money Pyramid
The three drivers of a modern payments platform are time, value and money and represent not only the benefits or outcomes provided to members, but influence the strategy and implementation as well.
“Members are seeing that larger financial institutions are making significant investments in digital technologies that provide value-driven payment solutions,” says Nish Modi, Senior Vice President of Digital and BI Strategy and Product at CO-OP Financial Services. “If credit unions don’t invest in those solutions, and they are not able to keep up, they will be left behind. That’s the time factor.”
In terms of value, Modi notes that although credit unions have long excelled in offering outstanding one-on-one service, consumer expectations are rapidly shifting toward convenient access to digital channels.
“Credit unions do have a really good foundation in terms of trust and the human connection. Now it’s about adding the other aspects of digital services and self-service, to really drive the overall value that credit unions provide their members.”
Of course, money is a factor that always looms large. According to Modi, the myriad ways consumers transact and use their funds are expanding to a broader payment ecosystem that includes not only debit and credit cards, but also newer channels like P2P, contactless and digital wallets.
“For credit unions to survive, they need to transform themselves,” Modi says. “Member interactions have moved from checking and savings accounts to using payment systems. Credit unions want to continue that engagement with their members and drive revenue by expanding into the payments world.”
Implementing an Integrated, Modern Payments Platform
The key to succeeding in payments lies in implementing a fully integrated back-office system that is easy to learn, efficient, and provides outstanding member service regardless of payment channel.
“The payments world is increasingly becoming more and more complex,” says Ajay Guru, Senior Vice President, Fraud Products at CO-OP. “With this increased complexity, there is a growing risk to maintaining efficiency in serving members’ needs. This trend is driving some of the biggest challenges for credit unions.”
The key to addressing these challenges is through driving a modern payments platform:
- The solution begins with employing an intuitive, easy-to-use cloud-based data platform that enables credit unions to understand their credit, debit and ATM portfolios.
By simplifying a wealth of complex member payment data, such a data platform serves as the foundation of the credit union’s payment infrastructure, providing easy access to actionable insights and unlocking portfolio growth opportunities.
“The platform is evolving from offering data insights to a more predictive model, providing credit unions with leading indicators and benchmarks to help the portfolio grow,” Modi says. “CO-OP Insights Center is designed to drive the value of the credit union’s payments portfolio and truly put payments at the center of the business.”
- Next, credit unions need a single, simple-to-use application that provides real-time access to cardholder account information and automates many of the services that front-line staff performs every day.
Such an interface allows member service employees to research transactions, answer questions, access and update cardholder account information and view reports at the click of a button.
“Springboard is a unified back-office tool that provides credit unions with a way to service their members, issue new cards, and view the member’s details and transaction activity,” Modi says. “On top of that, it is designed to unify all of the administrative functions across the full complement of payment products.”
3. The third leg of the stool involved deploying a streamlined, end-to-end dispute and chargeback resolution system.
Through a centralized cardholder claims management solution, credit unions can ensure their members benefit from rapid response times and dispute resolution.
“The CO-OP Resolution Center provides a great set of integrated tools that allows credit unions to enhance their payment processing experience and grow their overall portfolio,” Guru says. “It integrates across all of the credit union’s payment platforms for filing, processing, and investigating a dispute, provides provisional credit all the way through to dispute settlements, and is enabled through a cloud-based platform with near real-time alerts. It’s a real game-changer.”
In terms of the time-value-money equation, credit unions that employ a fully integrated, interdependent modern payments infrastructure are well-positioned to realize a strong return on investment (ROI).
“With access to the Insights Center, credit unions have the data to make strategic decisions, set goals and then measure the returns against those objectives,” Modi says. “And through a platform like Springboard, staff aren’t forced to learn multiple back-office systems to manage their business. This directly translates to shorter call times, more meaningful member interactions and seamless member experiences, resulting in happy members and bigger, better engagements.”