Credit union membership rose faster during the past year than it has since the mid '90s, and the shift was accompanied by dramatic gains in mobile app adoption. While the past year did not bring new members to every credit union, the data provides valuable lessons for credit union executives who hope to expand their organizations' membership numbers in the coming years. It's clear that mobile banking solutions will be an important piece of any growth strategy, and that people are ready to embrace the credit union model for money management.
Last year brought the biggest increase in credit union membership since 1994. Membership grew by 3.6 percent during 2014, and credit union loan portfolios grew substantially, according to the Credit Union National Association. Credit unions saw loan volume increase to 10.2 percent in 2014, a 0.7 percent change from 2013. The improvement in loan volume affected every type of lending, with credit card loans and unsecured personal loans providing the biggest growth.
"Loan portfolios grew substantially."
The membership gains are likely linked to the increase in loan volume, as credit unions are often able to offer members more favorable loan rates. These establishments also appeal to less-qualified people who may not be approved for loans at other lenders. As the U.S. economy improves, many people will imperfect credit are looking to leverage their newfound employment or higher wages to make large purchases like a home or car. Credit unions should court these individuals to continue the membership gains seen in the past year.
Mobile provides an opportunity
Mobile banking app use took off in 2015, according to data collected by Malauzai Software. The best performing credit unions and banks increased mobile app usage by around 60 percent, and adoption grew 35 percent on average. These changes are likely to affect credit unions disproportionately,according to a previous study from Maluzai, Credit Union Times reported.
As of March last year, credit unions were increasing their memberships' usage of mobile banking solutions by about 9 or 10 percent a month. Banks, by contrast, only saw 7 percent monthly growth. This demonstrates the need for credit unions to develop their mobile banking offerings to retain members and attract new business. It's evident that the average credit union member is more interested in mobile banking than the equivalent bank customer. This could be because credit union members expect a more personalized experience. Credit unions will likely see further membership gains if they provide mobile solutions that cater to this expectation.