Manage fraud risk, look at e-delivery and know how to serve Millennials.
By Fredda McDonald
Look back at 2014 for ideas on how to prepare for the new year to come: A year of high-profile data breaches kept security top of mind for consumers; the launch of Apple Pay and the looming 2015 EMV security-chip deadline defined payments; and both a digital payments revolution and a “Millennial shift” are well underway. Given these trends, how should credit unions prepare to stay competitive in 2015 and beyond?
The Year of the Breach 2014 started with the effects of Target’s high-profile data breach being felt in full force, rocking consumer confidence to the core. That was followed by the Home Depot breach and a dozen more widespread fraud and security issues that dominated the conversation for much of 2014. These events increased the pressure on credit unions to be at the top of their game; they demand CUs lead the way in security. The good news is that credit unions are well-positioned to do so; they also recorded an all-time high in member satisfaction in 2014. More than ever before, it’s imperative that credit unions can play minute-by-minute defense for members, as well as adopt advancements like EMV and new, more secure mobile solutions. CUSOs like PSCU employ sophisticated fraud strategies that can help credit unions keep member trust strong.
The Digital Revolution The digital revolution is here and credit unions need to guide the transformation of how they deliver financial services. The year’s end brought the blockbuster Apple Pay announcement, which has heralded in tokenization and a new security model. The announcement also signaled a new era in which digital providers seek to answer the call for greater security. The advent of Apple Pay could lead to higher adoption rates of digital wallets than ever before. Additionally, consumers are embracing an omni-channel shopping, payments and banking experience, to include mobile banking, digital payments, location-based offers and comparison shopping. These developments lead us directly to the need for transformation of the branch experience from strictly physical to a hybrid of digital and traditional. The great opportunity mobile gives credit unions is the prospect for increased frequency of engagement with members. Delivering services through mobile increases velocity and targeting of message, so credit unions now have the ability to touch members in the moment with what they need – be it fraud alerts or other important information. When credit unions team up with partners that help them get it right, the result is a relationship that keeps CUs top of wallet.
The Millennial Shift Along with the digital revolution, relevance in the future depends on how well credit unions understand and participate in the “Millennial shift.” Research shows that Millennials tend to support businesses that support the community. Naturally, this means credit unions and Millennials are a marriage made in heaven. Looking forward, it’s imperative for credit unions to attract the attention and loyalty of Millennial customers using mobile and technology. To do so, credit unions need to gain access to the types of tools and technology, innovations and investments that will help them grow and stay relevant with their current and future members. Security technology, including such advancements as EMV, Apple Pay and tokenization, will be vital if CUs are to meet Millennial demand for safer transactions. Similarly, credit unions need to partner with industry leaders that are creating technologies to push digital servicing to new heights.
Fredda McDonald leads the credit union experience creative marketing division of CUES Supplier member PSCU, St. Petersburg, Fla. Her focus is on marketing and consulting at the strategic and product levels – areas that help credit unions reach their maximum potential for relevance, growth and prosperity. Prior to joining PSCU, McDonald worked in strategy development at CUES Supplier member MasterCard, where she was responsible for revenue growth and innovation. Read related coverage in "Apple Pay and EMV Security," "Apple Pay: Now or Later," "Apple Pay and Compliance," and "Thoughts on Apple Pay, EMV."
