The Sum Up: The Rise Of Tech Acceleration In The Banking Industry

The COVID-19 pandemic has impacted every aspect of Americans’ daily lives. We have changed the way we work, the way we educate our children and the way we spend and manage our money.

That last item is one that we’ve discussed frequently at Addition Financial. A recent Forbes article talked about the ways the pandemic has impacted technology for credit unions and banks. Here are some of the key points and takeaways.

How Has the COVID-19 Pandemic Impacted Banking Technology?

Nobody anticipated the severity and impact of the COVID-19 pandemic. One of the things that the pandemic and resultant shutdowns have done is to shine a spotlight on technology and the ways it can be used to make our lives easy.

The Deloitte 2021 Banking and Capital Markets report put it like this:

“The crisis has also served as a litmus test for banks’ digital infrastructure. While institutions that made strategic investments in technology came out stronger, laggards may still be able to leapfrog competitors if they take swift action to accelerate tech modernization.”

In other words, credit unions and banks that had an established digital infrastructure were able to adapt quickly to the changing needs of their members and clients, while those who were lagging may have had to struggle to accommodate them. That said, the report concluded that there is still plenty of time for financial institutions to catch up and modernize their tech to keep up with their competitors.

What Are the Advantages of E-Banking?

In the wake of mandated government shutdowns and limitations on businesses, credit unions like Addition Financial had to help their members adapt to a new way of accessing and managing their money. What many of our members learned is that e-banking has its advantages. 

1. It reduces errors. Since transactions done electronically are calculated automatically, there’s less chance of human error – and that can make it easier to manage your money.
2. It saves time. For example, business owners might normally visit the bank every day to deposit checks. With e-banking, it’s possible to save time by making the deposit using a mobile phone or digital scanner.
3. It is more convenient than in-person banking. We’ve all heard jokes about “banker’s hours” and there’s no doubt it can be frustrating to realize that your bank isn’t open when you need it. E-banking is available 24 hours a day even on weekends and holidays.
4. It is safe and secure. Advances in cybersecurity mean that electronic and mobile banking are secure. You can be comfortable transacting business online.

Even Addition Financial members who were not comfortable with digital banking prior to the pandemic have now embraced it. While some may have been reluctant at first they have since realized that e-banking offers them a convenient and secure way to access their money when they can’t get to the bank.

What Happens with Online and Mobile Banking When the Pandemic Ends?

It’s difficult to say when the COVID-19 pandemic will officially be over and whether our lives will ever fully go back to what we used to know as normal. However, we can make some predictions about what is likely to happen to credit unions and banks – and to digital banking – as a result.

The most important thing is that we believe that many of the people who transitioned to e-banking because of stay-at-home orders are unlikely to return to in-person banking. Some may, but many have realized that online and mobile banking are the way forward.

For us, that means embracing a “digital first” mindset that asks how we can use technology to better serve our members. We recognize that, for some transactions, in-person meetings are necessary. We anticipate that loan and mortgage closings will still happen at our branches and that some of our members will still want access to in-person services.

However, we also anticipate that we will continue to build on our existing digital and mobile banking infrastructure to provide additional services and conveniences to our members. We recognize that for some, the ease of managing their accounts from a home computer or mobile device has been a revelation and an improvement.

A year ago, we could not have imagined how many of our members would be relying on our digital platforms and services to manage their finances. Our intention is to work to:

• Stay abreast of new technological developments in online banking and financial management with an eye toward providing better services to our members.
• Partner with technology experts where it makes sense to expand our digital services and offerings and provide new tools for our members to use.
• Embrace a digital first mindset in the spirit of discovery and innovation to ensure that our members always have the ability to access their money and improve their financial outlook.
• Keep up with the latest in cybersecurity and use new tools and protocols to protect our members’ money and data and fulfill our promises to them.

The Forbes article pointed out that credit unions, banks and other financial institutions must embrace digital transformation at every level.

“A companywide commitment to implementing effective and powerful tech solutions will help drive growth, boost business performance and move your focus to other critical areas your company has to attend to. Covid-19 has paved the way for change – it’s time to make it happen.”

For us, that means that every team member should play a role in ensuring that Addition Financial has the digital banking tools that our members need and want.

What Comes Next?

We don’t know exactly what the future will bring, but our goal is to continue to talk to our members about their experiences with digital and mobile banking. These conversations will be our guide to determining what the road ahead will look like – and how we can best serve our members.

Digital and mobile banking are already available to our members and we expect that new technologies and services will be a positive outcome of the COVID-19 pandemic.