A blog by Alison Donnelly, Director at fscom.

In a world where everything is becoming more complex, today’s consumers are seeking financial services providers who can simplify their lives. Solutions that are seamless and personalised are the top choice for consumers. In fact, 63% of consumers expect personalisation as a standard of service.

Today’s consumers are much more tech savvy, with millennials being the largest generation this year in America, overtaking Baby Boomers. Generation Z has also entered the market in recent years.

Articles about Open Banking are rife – since the second payment services directive came into play in September, Open Banking has become a hot topic of conversation.

At cuEngage 2019 I spoke about Open Banking and the opportunities that surround it.

Open Banking is brought about by the second payment services directive and people think: ‘directives, regulation – it’s a bind’. But the first and second payment services directives are all about competition. They’re about opening up the market to new players and giving customers better choice, which helps reduce cost and drives innovation.

Many banks and credit unions haven’t been able to deliver a truly seamless member experience due to things like data silos, decades-old infrastructure and a risk-averse culture. This has opened the door to “disruptors” and start-ups, such as Revolut and Monzo, that can leverage data and modern technology to deliver enhanced experiences.

But Open Banking opens up a world of opportunity for Credit Unions.

Credit Unions have topped the CX Survey for the 5th year in a row. There is no denying your customer service, and at the Credit Union members feel like people; not a number. However is there an opportunity to provide your members with an even better experience?

Now the Credit Unions need to consider whether there is an opportunity to provide their members with a better service. Would it be helpful to their members if they could log on to cuOnline+ and see in that portal not only the information that they provide them on their Credit Union account, but also their current account and their credit card account? This could be something members would find useful.

This offers members one holistic view of their finances, which gives them a better understanding of where they could make savings or spend less.

It also offers members more control and more freedom to choose from a broader range of financial services providers.

For your Credit Union, it opens up the opportunity for you to own the primary member relationship by allowing accounts from different providers to be accessed via a single interface owned by you. This allows you to promote your competing services directly to the member, side-by-side with other financial providers.

Since it gives you full visibility of members’ other banking accounts, you can have a better understanding of their spending/saving behaviour. This helps you make better informed decisions so there’s less lending risk.

Learn more about Open Banking in Wellington IT’s blog “PSD2 and Open Banking: Expanding the market for Credit Unions everywhere!”

Author: Alison Donnelly, Director at fscom.