While fintech companies are known for blazing new trails in banking, other FIs, particularly small, community-based organizations like CUs, have a reputation for being less innovative.
These institutions may face logistical challenges, such as a lack of budget to invest in technology development or having repetitive daily tasks that bog down their IT resources. It is also challenging to innovate with remote employees, a problem cited by 81 percent of CU executives in the PYMNTS survey.
PYMNTS found another problem for CUs is not so much lack of innovation as it is the wrong kind of innovation. For example, 86 percent of CUs developed mobile wallet services despite only 17 percent of their members voicing a desire for such technology. Similarly, 77 percent invested in creating new capabilities for mobile banking when only 23 percent of their members wanted them. Other areas where CUs have innovated without the interest of their members are peer-to-peer payments and installment credit.