Yesterday’s challenge was to provide mobile channels for consumer access. Today’s challenge is to create a digital infrastructure and experience that responds to consumer demands and economizes credit union operations.
Brian Branch serves as President and CEO of WOCCU
Young adults use digital means for their social networking, communication, news and commerce via online and mobile payment applications. They expect to handle their finances the same way. In 2013, one of the most common requests we heard from our members was for assistance in increasing their young adult membership. The median age of credit union members in most countries was 15 years older than the median age of the national population. In response, World Council of Credit Unions launched Vision 2020: to reach 260 million members by 2020.
Through a concentrated worldwide effort, credit unions were able to reach 260 million members by the beginning of 2018. Yet growth was not even across all countries or among all credit unions. The credit unions that grew were those that offered core services via online and mobile channels. That is why the next challenge we take on cannot simply be to increase membership. We address how we increase membership: through of the global digitization of the credit union system by 2025.
Digitization includes access to core services through online and mobile channels, automation of internal processes and connection to local payments and electronic ecosystems. But it means more than that. Digital product design allows credit unions to engage with members and receive feedback. Data tracking and analytics allow us to identify member preferences, risks and needs in ways that allow us to offer the best solutions to help them achieve their goals. And by extending cooperative trust, rather than selling them things they may not need or that might seem intrusive, we can remain their trusted institutions.
Digital data management helps the credit union adjust its offerings and identify its risks as well. One of the advantages of operating in the credit union sector is our ability and willingness to share resources and platforms that allow us to invest in technological systems needed for scaling up solutions and extending networks in the digital age. Most countries have found it is neither efficient nor affordable to create their own digital systems. It is more effective to build shared platforms and establish strategic alliances to connect to digital systems through a country’s digital ecosystem. This is about providing the member with greater convenience, less friction and seamless access. It is about making life easier.
The World Council of Credit Unions (WOCCU), headquartered in Madison, Wis., uses its conferences, communications, projects and technical papers as well as engagement, training and education programs to promote and support the digitization of the international credit union network. Through our international development platform, WOCCU is working on ways to support our members’ digitization. In Asia, WOCCU is leveraging financial support from the Bill and Melinda Gates Foundation to create and test digital payment platforms in the Philippines and Indonesia. The United States Agency for International Development (USAID) support is allowing us to digitize service delivery by credit unions in Guatemala, Kenya and Burkina Faso.
To achieve our goal of full digitization by 2025, we must include those people in some of the world’s hardest-to-reach areas. The challenges of providing them with digital financial inclusion are great. But even there — among the poor, the refugees, the economically excluded — most are like the rest of us in one key respect: they have a smart phone. It shows how connected we all are by technology today and how digitization is one of our most powerful tools for achieving financial inclusion for all going forward. ◊