The research on which this report is based on, sought to answer two questions that need to be seriously examined by leaders of all credit unions: First, what general strategies should credit unions use to respond to the digital revolution? Second, what should the answer to that question be now, in the near future, and in the far future? Question 1 is important because the digital revolution has the potential to dramatically alter both the internal operations and service delivery channels of credit unions. Question 2 is important because technology strategies appropriate for today are likely to be very different from those that will be needed for survival in the future.
What is this research about?
To evaluate a credit union's use of technology in a meaningful way, the researchers needed to link the kind and amount of technology which a credit union uses to its performance. To evaluate performance, the researchers used a measure called "member service efficiency." This measure works by comparing the levels of benefits which a credit union provides to its members relative to its resources. To link performance to the kind and amount of technology used required data on technology use for a significant sample of credit unions. The researchers collected this data using a mail survey that went to 2,00 credit union which covered 37 different technology applications that could be used by credit unions.
What are the credit union implications?
In the far future, competition to serve people of average means likely will come from financial service firms that include a brokerage subsidiary than from traditional depository institutions. To meet that competition, credit unions will need to reassess their view of what services members and potential members will need to accumulating savings. In the world of the far future, the average person will view savings far more broadly than just insured savings accounts and certificates of deposit.