Today’s consumers judge their financial service providers based on a new definition of trust—one that goes well beyond the traditional factors of safety and security, and includes elements like capabilities, access and convenience.
Adoption of digital services that are fully integrated into the member experience can go a long way towards addressing this new market dynamic and help credit unions compete with fintechs and new payment providers for consumer engagement.
“When you deliver fully integrated experiences, you’re also increasing member usage, engagement and loyalty because you’re meeting consumers’ expectations,” says Paul Vetter, Director of Integrated Partnerships at PSCU/Co-op Solutions.
Yet, integration with third-party digital technology and core providers is an ongoing concern for credit unions.
According to research conducted by PYMNTS and PSCU in mid-2023, credit unions cited two leading challenges when it comes to innovation: integrating various systems at once and being unable to bring innovations to market quickly enough. Cost is another driving factor in a credit union’s ability to integrate.
When Co-op asked top credit union executives about their most urgent pain points, one leader replied, “To get fintech solutions to integrate is almost impossible – the cost is too high to set up with third parties. We’re running behind every step of the way. How do we keep up?”
For credit unions, it’s not simply about integrating individual digital point solutions; it’s about building a solid foundation for deploying new technology solutions that meet evolving member expectations—both today and in the future. Establishing strong, collaborative partner relationships is how credit unions will set themselves up for sustainable success and growth.
“You’re not just trying to integrate to solve a single problem for today—such as digital card issuance,” Vetter says. “You’re picking partners to work together for the long term.”
To develop these long-term, collaborative partnerships, credit unions must embrace a strategic approach to integration, vendor selection and management.
5 Keys to Building a Successful Integration Practice
In today’s digital-first marketplace, credit unions need the ability to rapidly introduce new technology to their members, while unifying the back-office and member experience through a simplified delivery model. This is the only way to successfully compete with fintechs and digital payment providers and capture more of members’ daily interactions to maintain primary financial relationships. To do this, credit unions must ensure that all technology partners in their ecosystem work together and have the resources, funding and timelines to deliver.
Here are the critical elements your credit union’s integration strategy must have to ensure it is built for the long haul:
1. Clarity of mission:
To be successful, you’re your credit unions must be clear on the objectives you are trying to achieve with the projects on your technology roadmap. Every new solution or product offering must have a defined purpose, and generally that purpose should fall within three key buckets:
Will it improve the member experience?
Does it promote operational efficiencies?
Will it generate new revenue?
If your project doesn’t address at least one of these objectives, think carefully before taking it on.
2. Strong collaboration and alignment: Once you’ve defined your integration goals, seek out and select vendors that are looking to forge a collaborative partnership.
Make sure your annual plan and digital technology roadmap align with the capabilities of your partners. Realistic expectations are important and sometimes you can influence those if approached with all partners strategically.
For example, PSCU/Co-op facilitates Task Force Groups—steering committees consisting of credit unions that use the same digital or core partner. These Task Force Groups help drive collaboration by ensuring both PSCU/Co-op and the mutual technology provider hear the same message directly from our credit union clients on their challenges and goals. It ensures a better integrated experience, and fosters a “we’re all in this together” mindset.
“By proactively engaging them every step of the way, credit unions can ensure they’re hearing the same message—a cornerstone of a true collaboration,” says Vetter. “We’re all doing it together at the same time.”
3. Accountability and ownership: Once you’ve selected your preferred digital service provider, assign someone within the credit union to own the relationships. This individual must be accountable for the delivery strategies, tactical project plans, and managing timelines around execution.
4. The ability to leverage partners’ expertise: Don’t be afraid to lean on your partners for advice and guidance. They are the experts in what they do, whether that is payments, core processing, or digital services. As the credit union, you own the process and the ultimate goals of the relationship, but this doesn’t mean you need to know everything. You simply have to hold your partners accountable to guide you.
5. A commitment to being a good partner yourself: From the credit union perspective, being a good partner means communicating clear expectations, being open to the advice of experts and acknowledging your own resource requirements and constraints. By maintaining an ongoing and honest dialogue with your digital technology providers, you will ensure that all parties will take equal responsibility in making your projects a success —together.
Deep integration goes beyond APIs
Unfortunately, many third party fintech providers, particularly those that haven’t been around very long, are focused on creating one specific product offering—the definition of a point solution. These vendors typically don’t prioritize a holistic integration strategy when selling their solution.
According to Vetter, it’s important to seek out partners that are large enough to have developed a mature integration program, versus those that rely on creating limited, out-of-the-box offerings. A mature program extends itself beyond the technical aspects of simply providing RESTful APIs. Mature programs include investing time and effort to engage with those that integrate with your product set. Just as relationships matter to how credit unions do business with their members, relationships matter in how technology providers work with each other.
PSCU/Co-op has deep experience partnering with a variety of leading credit union technology vendors, including core system processors and digital providers every day. This gives us a front row seat to identify which vendors are committed to supporting and partnering with their clients in a spirit of continuous improvement and collaboration.
“Partnership is one of our core values and we work closely with our vendors to ensure our credit unions have both a voice and priority in achieving their goals,” said Katrina Beery, Director of Industry Partnerships for PSCU/Co-op Solutions. “We work agnostically with your vendor partners, and are committed to serving in a consultative role, ensuring your credit union gets the attention you need to be able to serve your members the way they deserve.”
Co-op is focused on proactively building strategic integrations with a carefully curated group of premier technology vendors. This approach ensures that the digital experience is seamless, simple and easier to navigate for both credit union employees and your members.
To request more information on Co-op’s solutions, please contact your Co-op Business Executive, call 800.782.9042, or email solutions@coop.org.
