Throughout the past year, the financial industry has drastically changed due to the impacts of the global pandemic and increasing member expectations. Members are increasingly preferring digital banking services, which has allowed challenger banks and fintechs to become fierce competition for credit unions.
As credit unions strive to achieve digital transformation, their efforts are hindered due to a missing component of their strategy – cloud technology. An omni stack or a single stack cloud-native solution has several benefits, including reducing overhead costs, accelerating product development and most importantly, enhancing the banking experience for members. Several challenger banks and fintechs have already started to explore the benefits of cloud-native solutions and the time is right for credit unions to do the same.
Lowering the Total Cost of Ownership
Traditionally, maintaining and updating software has been an expensive process for credit union operators, especially when considering the additional costs of hiring staff to manage these systems. Furthermore, many credit unions must buy more software as they continue to grow their member base and product offerings.
However, credit unions can eliminate these costs by partnering with a strong technology service provider to implement cloud-based technology. An omni stack technology service provider can own the management of different softwares, ultimately saving credit unions the costs of repairing or replacing it. Along with reducing software costs, an omni stack cloud-based technology can drastically decrease a credit union’s labor and maintenance fees. Since the hardware is being managed by a single vendor, there is less of a need for depending on ten different vendors and extra in-house IT staff. Furthermore, IT staff members that are essential to a credit union’s operations can spend more time focusing on digital transformation initiatives.
Accelerating Product Development
Despite the technology advancements in the financial industry, many credit unions still prefer to utilize their legacy core due to the high costs of a full conversion. However, legacy cores have proven to be a major obstacle for credit unions that are striving to digitize their offerings due to the challenges of bridging the gap between old and new IT systems.
Credit unions can overcome these challenges by deploying cloud-native solutions into their operations. Modern cloud-native solutions work in tandem with a credit union’s core to digitally transform banking services, eliminating the need for a full conversion. With cloud-native solutions, credit unions can quickly meet the needs of members with innovative solutions and personalized product offerings. Furthermore, 88% of cloud-native leaders believe the technology has improved the agility of their organization.
Enhancing the Member Experience
Due to the impacts of the global pandemic, digital banking services are now considered a necessity for credit union members. According to Ascent, more than 95% of banking customers ranked mobile and online access as their primary factor when choosing their financial institution. In light of these findings, credit unions must expand and improve their digital offerings to meet the evolving needs of members.
Modern cloud-native solutions enable credit unions to quickly launch new products and effortlessly update existing ones. Additionally, cloud-based technology will ensure the products integrate with each other, ultimately providing members with a seamless banking experience across all digital channels.
The past year has taught credit unions to expect the unexpected. As the financial industry continues to evolve, an omni stack cloud-native solution will empower credit unions to future proof their systems and quickly adapt to changes in the market. From streamlining internal operations to supporting digital innovation, cloud-native solutions will provide credit unions with unlimited opportunities.