By Todd Clark, President and CEO, Co-op Solutions
By all accounts, 2022 was a year of accomplishment for both Co-op and the credit union movement.
Credit unions have continued their strong growth in membership, with 5.7 million members added over the year ending in the third quarter of 2022. Total assets grew by $132 billion (6.6%) year over year, and loans outstanding increased by 19.2%, despite a continued gradual decline in the number of federally insured credit unions.
At Co-op, we kicked off 2022 by announcing our rebranding to Co-op Solutions with a new name, corporate tagline, and logo. The move reflects Co-op’s ongoing evolution as a proven innovator of reliable, secure, digital-first payments for the modern member and the leading provider of operationally efficient experiences for credit unions.
This renewed focus has helped spur Co-op to record revenues in 2022, with strong new business sales and a high existing client renewal rate. Co-op clients continued brisk adoption of recent product additions such as Digital Card Issuance and Zelle, as well as Co-op Contact Center, Co-op Shared Branch and Credit/Debit Processing. The company also made new inroads in Eastern Seaboard markets, particularly in Maine, where the Co-op ATM network grew to 150 locations, a 67% increase from the previous year.
One of the things I’m most proud of is Co-op’s commitment to the movement’s charity of choice, Children’s Miracle Network Hospitals. More than $4 million was raised through the Co-op Miracle Match program, combining CU4Kids fundraisers and Co-op matching funds. In addition, Co-op donated all benefits of its sponsorship of the 2022 President’s Cup golf tourney in September. As a result, Co-op Solutions and its credit union partners raised nearly $30,000 for charity – $16,100 for CMN Hospitals and $13,500 for Financial Well-Being for All, the National Credit Union Foundation’s financial wellness campaign.
A Focus on Growth Strategy
In 2022, we held our first in-person THINK event since 2019 and it was great to see so many of our credit union partners and industry stakeholders in that environment for the first time in three years. Our flagship growth strategy conference featured an all-star lineup of keynote speakers, informative content, breakout sessions, and the best networking opportunities in the business—all to inspire and ignite transformational change and spur credit union growth. Building on this momentum, we are excited to welcome our partners to Tucson, Arizona for THINK 23 May 2-4, 2023, with the theme of “The Invisible Revolution.” More information can be found here.
We also delivered industry-leading research to help facilitate meaningful conversations around the future of credit unions. Co-op partnered with both EY and Filene Research Institute for the CU Growth Outlook. This research uncovered what members most desire from their primary financial relationships, and the significant challenges that credit union leaders face in delivering on these preferences – and what strategies and solutions can help bridge the gap between the two.
These conversations continued at the first Co-op CEO Summit in June, where more than 60 credit union senior executives gathered to discuss how we as an industry can effect change in the face of the 3Es – earnings, experience, and expenses.
Payments as the Pathway to Member-centricity
As a result of the Summit, we published the Blueprint for Credit Union Leaders, an in-depth exploration of the current challenges facing credit unions as defined by credit union leaders themselves, along with a path leaders can take to achieve growth and sustainability for the future.
Namely, prioritizing investment in several key areas, leading with member-facing digital solutions, data optimization, and developing talent for future needs. Most importantly, pursuing a payments-first strategy with financial wellness as the driver is the key that will unlock long-term growth.
The dramatic shift in consumer expectations has highlighted the importance of digital engagement as a key to earning trust. And payment transactional data is the linchpin that draws people into your application every single day. And then, how do we stay, as credit unions, present in members’ minds?
The lesson here is that we need to redefine what trust means to our members. We need to reexamine what it now means to be member-centric.
The time is ripe for action, and fortunately, the opportunity is right before our eyes—if credit unions can bridge the gap between their current product offerings and those products and features consumers expect and demand today.
The key to capturing wallet share and achieving long-term, sustainable growth lies in establishing regular, high-frequency engagement with members by meeting their everyday digital payment needs.
Setting the Stage for 2023 and Beyond
As we enter 2023, credit unions recognize that tying together payments and the member experience is key to achieving long-term growth and sustainability in a financial marketplace where consumers are confronted with a dizzying array of choices.
We call this the “new member-centricity.” And to begin, credit unions must design their products and services more closely around daily member behavior.
Those organizations that have had success in owning the primary relationship own the wallets of the consumer. And owning the wallet is a good thing because the positive role you play in that person's life is in being their financial operating system: offering them the guidance and tools to make sound financial choices and decisions. Delivering the right solutions to the right members at that right time—whether it's a lending solution, a payment solution or anything else—requires a commitment and a sustained approach.
To compete effectively with fintechs and other non-traditional financial providers, credit unions must take advantage of new opportunities to engage and serve our members. And this begins by investing in digital payments infrastructure and offerings.
To support this investment, in early 2023 we will roll out the Co-op Pay Network, a new debit POS network designed specifically for credit unions and to help them receive the most favorable debit point-to-sale terms.
As we look back on 2022, it’s important to appreciate our movement’s successes and growth, while also recognizing areas of future opportunity. In 2023 and beyond, our collective focus must be on striving for the new member-centricity, which places digital payments squarely at the center of the relationship and reinforces the special bond credit unions hold with our loyal members.