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Credit union members expect a consistent experience across channels.
The pandemic forced a near-overnight explosion of digital commerce. Four years later, there’s not much we can’t do online. Even fairly involved tasks, like seeing a doctor or renewing a passport, can now be done from home and largely on the terms of the individual seeking service.
Borrowing money has, of course, joined the list of things that can be done digitally. Yet, as new human intelligence from CUESolutions provider TruStageTM indicates, not all borrowers prefer to engage online. When they do, however, digital lenders that are intentional about enhancing product awareness achieve the best outcomes.
Different Points of Value Within Different Lending Channels
Today’s borrowers expect access to multiple channels, not only to apply for a loan, but also to research which loan product is right for them. In other words, they want options.
TruStage’s research observed minimal variance in the channels borrowers used to contact their financial institutions. For example, 27% of recent personal loan borrowers reached out to a lender online, 26% did so in person and 27% chose to contact via phone. This may be because borrowers find different points of value in each channel.
Just more than half of the TruStage survey respondents believed that applying for a loan in person would be a better experience, at least in terms of getting all their questions answered and receiving the best customer service. However, the online channel was presumed to be the best (among 42% of respondents) for saving and making changes to a borrower’s information. Consumers also believed the ability to compare options would be better online vs. in-person.
Interestingly, borrowers applying for a loan online expect to move through other channels as their needs warrant. Nearly four in 10 online loan applicants said they expect to call and talk with a representative; 33% expect a follow-up call from a person; 34% said they expect to chat online with a representative.
This tells us that today’s borrowers expect lenders to meet them where they are. Yet they also presume they’ll be able to switch to another channel any time they want, having a consistent experience across the lending ecosystem. This is why we see credit union lenders leaning in on technology integration. The chances of a successful engagement between lending staff and borrowers are much better with a single, real-time view of borrower data and loan details. Automated solutions that enable simpler interactions can add to the experience.
Awareness Leads to Action, Especially Online
Speaking of setting borrowers up for success, credit unions are keen to provide a financially healthy experience for members and prospects in need of credit. This is especially true for online borrowers who may not always make the wisest choices due to the fast-paced, instantly gratifying nature of the internet.
Borrowers, too, want to feel confident in their lending decisions. Awareness of steps to mitigate loan defaults and other risks is crucial for building this confidence. Time and again, the TruStage research found a strong correlation between awareness and action. For example, when asked why they did not choose to add a payment protection product to their loan, many borrowers said they weren’t aware of the option.
Across all loan types, 60% of borrowers weren’t offered or do not recall being offered a payment protection option. The same percentage said they would elect one or more payment protection products along with their loan if offered the option.
Although we tend to think of awareness as a people-powered outcome, digital technologies are getting really good at enriching the knowledge of humans. One of the capabilities that allows for this is hyper-personalization. When online borrowers are presented with protection products in a highly relevant manner and time, they are more likely to opt in.
Credit unions that integrate education and tools to help members understand the value of personalized protection products into the digital experience stand to enhance borrowers’ awareness—and potentially, their overall financial wellness.
Learning What Members Expect
Among legacy financial institutions, there has been a tendency to “check the digital box,” which has led to an abundance of unsatisfactory digital window dressing. As the TruStage research indicates, simply digitizing an in-person experience isn’t enough for today’s borrower. Knowing what members are expecting in each channel helps lenders prepare to best meet their needs. Those insights and more can be found in the 2023 TruStage Lending Consumer Preferences Report.
Amy Robertson is a leader within TruStage’s Lending Member Experience team. She can be reached at amy.robertson@trustage.com. Robertson leads digital distribution and platform services for lending products at TruStage. She has over a decade of experience translating data and insights into actionable strategies for digital experiences across a wide range of industries including financial services, media and healthcare. She is passionate about the opportunity to participate in the credit union mission of prioritizing the financial health and education of members. She holds a Master’s degree in Analytic Marketing from the Kellstadt School of Business and a BA in Economics from the University of Chicago.
The views expressed here are those of the author and do not necessarily represent the views of TruStage. All data in this report is sourced from the 2023 Consumer Lending Preferences Research, conducted by TruStage in partnership with Epsilon, February 28 - March 22, 2023. TruStageTM is the marketing name for TruStage Financial Group, Inc. its subsidiaries and affiliates. Corporate headquarters are located in Madison, Wis. © TruStage LPS-6497018.1-0324-0426
