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How to Build Transparency With Digital Banking Technology

A fundamental difference between a credit union and its competitors — conventional banks and faceless fintech startups — is that a credit union is community-based. This is true not just in the sense that a CU serves a specific community, but also in the sense that a CU is — or can be — a community in its own right. 

Building a sense of community with your users is a crucial part of retention, which in turn drives growth and profits. One of the most powerful tools at your disposal is transparency and openness with your users: a willingness to open up about your goals, your achievements and the challenges you face. It’s deceptively simple in theory, but finding ways to put the theory into practice can require more thought. 

Talk About Your Role in the Community

The easiest way to practice transparency is through “blowing your own horn,” and letting users know about all of the things you do in the community. 

Studies show that many consumers — from aging, “unreconstructed hippies” to youthful Gen Z idealists — consciously seek out businesses and products that reflect their values, from sustainable seafood to recycled goods. Being transparent about your initiatives in the community brings you into sync with this powerful driver of consumer behavior.

This is more than just self-promotion, and shouldn’t be framed in those terms. By casting your financial institution as a positive force in the community, you’re also giving consumers a reason to feel good about themselves. Being a user itself becomes an important form of “community” for them, and part of their self-identity.

Diversity, Equity and Inclusion

Similarly, be vocal about your initiatives in diversity, equity and inclusion. Ethnic and visible-minority groups have historically been poorly served by the commercial banking world, from the explicit discrimination of the “redlining” era to the subtler biases of modern artificial intelligence- (AI-) driven fintech apps. 

It’s been well-demonstrated that extending financial services to the unbanked and underserved can be life-changing, and bring widespread benefits to the larger community. Whatever your initiatives, from breaking the payday-loan cycle to funding minority startups and outreach to specific new-immigrant communities, communicating openly about your successes (and challenges) should be a high priority.

Create and Promote User Involvement Opportunities

A relatively small percentage of your user pool is interested enough in the workings of a credit union to attend meetings or take a formal role in advising the board. Their input is valuable, of course, and they’ll have significant exposure to the practical realities of running a credit union, but there are less-formal and less-structured ways to extend that transparency to a wider cross-section of consumers. 

The data from your digital banking technology can be a fruitful source of information to share with your users. It’s relatively easy to periodically incorporate attention-getting excerpts from your analytics (“Users refinancing their mortgages this year cut their interest rates by an average of 1.8 percent …”) into your social-media feeds and newsletters.

When your analytics identify gaps in your current services and products, explain what you’d like to do and then approach your consumers for their input. That could take the form of a conventional survey or a simple call for free-form responses (“Funding a side hustle is a lot harder than funding a conventional business. How can we help?”). In the name of transparency, you might solicit users’ input in virtual brainstorming sessions. A modest incentive for participation, and recognition or more-tangible incentives for ideas that are adopted, can help drive participation.  

Communicate Anything That Touches on the User Experience

Communicating clearly and openly about change is especially crucial, because people are — in general — resistant to change and comfortable with the familiar. It’s mandatory for things like rate changes, but it’s also crucial to be transparent about changes to anything affecting the user experience. 

That includes everything from your physical branches to your printed materials to your digital banking technology. If your ATMs are getting an upgrade that changes their interface, you should announce it in advance and offer a visual tutorial to ease the transition. If your branches are getting a redesign, explain both the changes and the reasoning behind them. If you’re upgrading your digital platform, explain the changes and improvements your users can expect to see, and why these will benefit them.

Be More “Open Book” With Users — and Staff

Some credit unions have adopted the Open Book Management strategy to foster employee engagement. The basic idea is to share financial information with employees at all levels — not just the C-suite and management — so they can grasp how their individual efforts affect the success of the enterprise as a whole. Essentially, it gives them a sense of having some “skin in the game” beyond receiving a paycheck. 

Selectively extending that concept to your users is a deeper form of transparency that, if implemented thoughtfully, could increase users’ sense of community and common purpose. For example, employees are often challenged to suggest how operations can be streamlined and costs reduced, on the logical basis that they’re the ones who handle operations day to day. Your consumers are just as involved, and their perspective from the other side of the counter can be equally valuable. 

Even if you never draw on your consumers for that kind of input, the simple act of drawing back the curtain and giving them a deeper look at how you operate can be a powerful thing in itself. It drives home the point that they’re owners, not just consumers, and emphasizes their personal stake in the credit union’s success.  

Using Banking Technology to Aid Transparency

It’s important to note that you can only be transparent with data you actually have. The better and deeper your sources of data, the more information you’ll have at your disposal for analytics and decision-making, as well as sharing with your users. 

The best tool for the job is a fully integrated digital banking platform that functions seamlessly in all devices, from your web presence to your mobile app. Bringing every aspect of the user experience into the digital space, under a single unifying software product, creates an unmatchable base of raw data. Once you have that at your disposal, the insights you derive from the data can inform your transparency initiatives as well as your marketing and user-retention plans.

Lumin Digital is exactly that kind of powerful software tool. Contact us today for a demonstration of how it can help you build bridges with your consumers through transparency and personalization.