Digital Banking: Everything, Everywhere, All At Once

Studies show digital banking benefits financial institutions as much as it does accountholders

Everything, everywhere, all at once. Yes, that’s the name of the 2022 Oscar-winning movie, but it also perfectly describes what your accountholders expect in digital banking services.

Differentiated digital capabilities are critical to the success of today’s banks and credit unions. Fortunately, digital banking benefits financial institutions as much as it does accountholders. Digital banking usage has been shown to drive customer loyalty, increase profitability and reduce costs.

In 2022, the approximately 2,500 banks and credit unions that leverage online and mobile banking solutions from Fiserv saw average year-over-year organic user growth of 9%, demonstrating the strong ongoing demand for these services.

Fiserv partnered with two financial institutions in 2022 to complete digital engagement intensity studies to better understand the characteristics of digitally engaged members, most specifically how the use of digital banking drives value.

Megan Pannier, vice president and head of marketing analytics for Digital Solutions and Digital Payments at Fiserv, explained, “In our experience with thousands of financial institutions, we’ve seen that the adoption of digital banking and payment solutions strengthens accountholder engagement and retention, but also leads to the adoption of additional solutions. These studies support that premise.”

 

Case-in-point #1

America First Credit Union (AFCU) embarked on the digital engagement intensity study in partnership with Fiserv to understand how members engaged with the institution’s digital banking products. Using segmentation, behavioral data and transaction history, Fiserv calculated the engagement of AFCU’s digital and nondigital members.

“We wanted a better understanding of who uses digital platforms and how they contribute to performance measures like profitability,” explained Brice Mindrum, Senior Vice President of Digital Services at AFCU. “We needed to know if the money we spend on digital banking is worth it.”

The results were conclusive. Just look at these product adoption stats, digital members compared to nondigital members:

These metrics, as well as growth for ACH usage, highlights that the usage of digital products builds primary banking relationships.

 

Case-in-point #2

The Boeing Employees’ Credit Union (BECU) study with Fiserv looked at differences between digital and nondigital members as well as at the incremental value that digital payments provide to the credit union and to the members.

The results? Digitally engaged members:

• Generated 45% higher net profit
• Were 2.5 times more likely to have at least one loan product
• Had 15% more credit union product holdings, such as checking accounts or loans
• Carried 30% higher deposit balances

In addition, when digitally engaged members also used at least one digital payment product, additional value was shown when compared to nondigitally engaged members:

• Net profit was 60% higher
• Product holdings were 15% higher
• Deposit balances were 52% higher

“Our vision [for digital payments] was to help members move money quickly and conveniently, as fast as they need to move it,” said Thomas Hobbs, Director of Payments, Fraud and Business Product Strategy at BECU. “And that’s what we achieved.” 

How to achieve digital banking success

Developing a robust digital banking program can be difficult. At a minimum, digital programs can include online account opening and loan origination, digital payments, money management and card management.

To meet these digital needs for our clients, Fiserv offers Experience Digital, which unites the best digital and fintech journeys to accelerate financial institutions’ digital roadmaps and meet consumer expectations through a simple, seamlessly connected digital ecosystem powered by open banking APIs.

Fiserv offers two suites that give financial institutions either a turnkey or customizable approach to meet their unique needs. Fiserv also provides banks and credit unions with complementary groups of data-rich tools that are designed to grow customer acquisition and wallet share, increase digital engagement and lower costs through increased efficiencies.

“Digital banking has evolved into a full ecosystem of capabilities that people rely on to manage their financial lives, so creating an engaging digital experience is key to establishing and fortifying customer relationships,” said Whitney Stewart Russell, president of Digital Banking at Fiserv. “Fiserv digital solutions can be tailored to meet the unique needs of each financial institution, enabling them to advance their digital strategies and deliver the experiences their customers expect.”