March 2018
The March edition of Co-op News we look at how technology poses challenges to credit unions, as well as other co-ops. There are also updates from the 6th Ways Forward conference in Manchester, where shadow business secretary Rebecca Long-Bailey shared her vision for a co-operative economy, and a Q&A with Co-operative College vice principal Dr Cilla Ross ahead of the 2018 co-op education and research conference.
The March edition of Co-op News we look at how technology poses challenges to credit unions, as well as other co-ops. There are also updates from the 6th Ways Forward conference in Manchester, where shadow business secretary Rebecca Long-Bailey shared her vision for a co-operative economy, and a Q&A with Co-operative College vice principal Dr Cilla Ross ahead of the 2018 co-op education and research conference.
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BOBBY GOULD is client services director for CMutual. He has worked with the company serving credit<br />
unions in a number of roles since 2001. He is currently studying at University of Ulster & Boston College,<br />
working towards an MSc in executive leadership. He has facilitated strategic planning sessions with a<br />
variety of credit union boards across the UK. CMutual is the pre-eminent insurance specialist for credit<br />
unions, providing protection products and services, as well as sharing knowledge and insight from across<br />
the credit union world.<br />
WHAT ARE THE KEY DIGITAL TRENDS THAT COULD<br />
CAUSE DISRUPTION FOR CREDIT UNIONS?<br />
Mobile, mobile, mobile! By 2025, it’s estimated<br />
that 75% of the workforce will be millennials – that<br />
is, people born after around 1980. They have had<br />
internet access their whole life. For many, their first<br />
mobile phone was a smartphone. The challenge for<br />
credit unions (and businesses in general) is that<br />
keeping up with the competition isn’t good enough;<br />
the real challenge is keeping up with the customer.<br />
Credit union members are no longer comparing<br />
their experience with RBS, Lloyds or Barclays<br />
anymore, they’re comparing it with Amazon, Apple<br />
and Google. Amazon accounted for upwards of 50%<br />
of all online sales in the US, and over 40% of their<br />
sales are made from a mobile device.<br />
Therefore, a key digital challenge for credit<br />
unions is how to serve members in an “always on<br />
and available” mobile-friendly world. Among other<br />
things, this means looking at the automation of<br />
payments, transactions, applications, recruitment.<br />
WHAT ARE UK CREDIT UNIONS ALREADY DOING<br />
DIGITALLY AND WHERE COULD THEY IMPROVE?<br />
Many credit unions now have websites and allow<br />
members to check balances online. Electronic<br />
payments and transfers are also the norm for many<br />
credit unions in the UK. Some have implemented<br />
electronic loan and membership applications.<br />
To embrace technology, it can be helpful to think<br />
about its variety of uses, and then prioritise.<br />
Member interaction – using technology to<br />
improve how the member can contact their credit<br />
union, and be contacted 24/7/365.<br />
Marketing – using social media for marketing,<br />
awareness and advocacy.<br />
Educate and excite – using technology to reach<br />
out to members and explain the Credit Union<br />
Difference, provide information and education.<br />
Automate – using technology to reduce or<br />
eradicate manual processes where possible, to<br />
improve convenience and access.<br />
increase transparency and perhaps renovate the<br />
relationship between credit unions and regulators.<br />
Where it is different from using existing tools<br />
(like online reporting) is that it seeks to use new<br />
technologies like cloud computing, APIs and data<br />
analytics to solve regulatory and compliance<br />
requirements more effectively and efficiently.<br />
DOES SCALE MATTER WHEN CREDIT UNIONS ARE<br />
CONSIDERING WHETHER TO ADOPT NEW TECH<br />
PLATFORMS?<br />
Scale does matter – implementing a “digital<br />
mindset” requires changes to the systems and<br />
controls that a credit union utilises to deliver<br />
effective governance. Cost, of course, is also<br />
a big factor; however where credit unions can<br />
identify common objectives or requirements then<br />
collaboration can enable smaller credit unions to<br />
benefit from new technologies.<br />
TECHNOLOGY CAN POSE NEW CHALLENGES<br />
RELATED TO SECURITY. HOW CAN THESE BE<br />
ADDRESSED?<br />
The forthcoming introduction of the General Data<br />
Protection Regulation in May this year places a<br />
new emphasis on how companies protect personal<br />
information. Technology is part of the solution to<br />
security, as well as part of the problem.<br />
Understanding where data is stored, why we<br />
have it, who has access to it, and how we ensure<br />
the security around it is suitable, is increasingly<br />
important. One step that credit unions can take<br />
is to become Cyber-Essentials certified. This<br />
is a government-backed initiative that helps<br />
businesses measure their cyber-resilience and take<br />
steps to improve it.<br />
CAN TECHNOLOGY HELP LIFT A REGULATORY<br />
BURDEN FOR CREDIT UNIONS?<br />
After FinTech comes RegTech! If Fintech focuses<br />
technology on the member, Regtech is the<br />
application of technology to decrease costs,<br />
MARCH <strong>2018</strong> | 31
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