The pace of fintech innovation just keeps accelerating, and it can feel daunting for credit unions to figure out which tools will drive real value and which vendors deliver proven solutions. CU2.0 is a digital consultancy focused on helping credit unions navigate the ongoing digital transformation of consumer experiences and credit union operations.
We sat down with CU2.0 Founder and CRO Chris Otey and Total Expert General Manager of Banking James White to discuss why credit unions face unique challenges with technology adoption, how they can increase digital agility, and where they should focus their attention and investments for tomorrow.
What is the biggest challenge credit unions face in terms of adopting new technology?
[Chris] Speed to market. Part of that is inevitable because they’re heavily regulated financial institutions with a fiduciary responsibility to their members. They shouldn’t be at the very forefront of technology. But part of it is cultural. Very few credit unions are technology enthusiasts or even early adopters. It’s not in their nature. That conservative stance is typically reflected by the lack of development resources and budgets to make the discovery of new technologies.
But there’s growing recognition in the industry that the disruptive competitors—fintech solutions, fintech banks, and the like—are quickly adopting new technologies to drive aggressive customer acquisition strategies, particularly in the home lending space. Credit unions are recognizing they must evolve to avoid being disrupted—without absorbing any additional risk.
What barriers hold credit unions back from adopting the technology?
[James] Credit unions face several unique issues—from resource limitations to a risk-averse operational culture and regulatory uncertainties. Credit unions typically prioritize direct member benefits with no perceived risk. By contrast, a big investment in unproven technology is much less appealing.
Additionally, it’s difficult for credit unions to find suitable tech solutions and partners that are built to fit the specialized nature of credit union operations. Those difficulties manifest in terms of integration complexities with existing legacy systems and a cautious approach to data security and member privacy—which further slow (or stall) technology adoption.
To keep pace and avoid disruption by fintechs, credit unions have to take a more strategic approach to enabling digital innovation that balances meeting member needs with carefully ensuring regulatory compliance.
How do you see technology helping credit unions that have historically been highly relationship-driven?
[James] Used well, new technologies will enhance credit unions’ historically relationship-driven model—making relationships more human and interactions more personal. Digital tools can help credit unions harness their member data to provide tailored financial advice and product offerings to deepen member connections by delivering a more personalized banking experience. Automation of routine transactions and workflows frees staff to focus on high-value human-to-human interactions, fostering stronger member relationships. Online and mobile platforms give members easier access to services, ensuring members receive consistent, convenient support.
Ultimately, credit unions need to see technology as a catalyst, enabling credit unions to uphold their community-centric values while meeting evolving member expectations for convenience, security, and personalized service in the digital age. This is crucial as credit unions need to compete against new entrants in the financial services market.
How have credit unions engaged in buying tech in the past? How have those buying habits hindered their ability to grow?
[Chris] The traditional buying cycle of credit unions is due for change. In years (and decades) past, credit unions would purchase solutions from one technology provider—their core provider. The speed of innovation and disruptive change has dramatically accelerated in the tech world, yet the typical credit union’s process of buying services has not changed.
Credit unions will go look at three or four vendors for similar solutions. Once they select the vendor that works best for them, they will negotiate a contract for at least two years, but more likely four or five years. That is way too long to be locked into a single technology. In today’s rapidly evolving SaaS landscape, leading tech vendors innovate continuously, and solutions will be outdated in months—not years. Additionally, the advent of middleware solutions means core providers are no longer a bottleneck in deployment, so credit unions can bring new technology (and its benefits) to their members much faster.
Credit unions need to shift toward the “fail-forward fast mentality,” that has defined leaders in other sectors for some time now. This approach frees them to deploy readily available technologies. Some credit unions are now following this approach—and they’re seeing just how rapidly they can realize business value and ROI from new technologies.
[James] I agree. Credit unions’ conventional, slow-moving tech procurement processes need modernization to take advantage of rapid technological advancements. That shift towards a more agile, fail-forward approach—leveraging SaaS and middleware solutions—can significantly enhance their adaptability and competitiveness. By moving away from extended contracts with single providers, credit unions can quickly integrate emerging technologies, respond to member needs, and drive more agile growth strategies in today’s dynamic digital landscape.
Where have you seen technology most benefit credit unions over the past 3-5 years?
[Chris] More and more credit unions recognize the need for digital-first approaches to attracting attract and building trust and loyalty. Allowing a consumer in New York to be a member of a credit union in California—or vice versa—is a valuable thing for those credit unions and for those consumers. The technologies that enable these digital-first relationships are the biggest tech boon to credit unions over the past several years. I’m not referring just to digital banking solutions like online banking or mobile banking. I’m referring to fintech solutions that can easily plug into credit unions to power everything from financial literacy to marketing automation, personalization and so much more.
[James] This focus will be crucial for achieving digital growth, attracting new members, and enhancing member services with fewer resources. Technologies that facilitate targeted communication and streamlined operations will be pivotal, driving credit unions toward more significant innovation and member satisfaction in the competitive market.
What is the most important technology credit unions should consider over the next 12-18 months?
[Chris] The next 12-18 months will be focused on automation, efficiency, and personalization. These were already the big priorities—or should have been—but now the technology is there to support them. Companies like Total Expert have already mastered the art of getting the right message in front of the right member at the right time. Now, they’re focusing on applying this data-driven art to support credit unions’ digital growth and answer the question, “How do we balance membership growth with membership retention?” But we’re also seeing companies like Total Expert attacking another key question for credit unions right now: “How do we do more with less?” That’s where fintech is headed.
[James] To echo that, credit unions need to emphasize tools that enable precise messaging and seamless experiences. These capabilities will be crucial for credit unions to balance serving, supporting, and growing their membership with the realities of optimizing resources. This is how credit unions can make significant strides toward building a sustainable, competitive advantage in the digital era.
The most exciting—and sometimes intimidating—part of the fintech world is that the possibilities and opportunities evolve constantly. Total Expert and other leading innovators are continuously advancing digital tools, creating new capabilities, and fostering new partnerships (like our collaboration with CU 2.0) to better help our credit union customers meet the emerging demands they face.
Learn more about how Total Expert gives credit unions the purpose-built functionality to make more personal connections and drive member loyalty—at scale.
To learn more about how CU2.0 can help your credit union build a future-ready digital growth strategy, visit their website >
