How Digital Transformations are Redefining the Banking and Credit Union World

By: Web Finance Direct

As we enter 2023, the importance of leveraging digital transformations in banking is being felt across the financial spectrum. From apps to indirect lending on online splurges, the American (and global) consumer base enjoys a wide range of options to customize their financial experiences. Banks and credit unions that lag behind the finance industry’s wave of digital transformations are left at a competitive disadvantage, especially as convenience and speed are two highly valuable decision-makers for potential clients. In this blog, we’ll discuss how to provide clients with a seamless experience through software to improve member retention and satisfaction.


Digital Banking Software: An Overview 

To start, let’s define what’s behind the digital transformations in banking. Digital banking software—or credit union technology—refers to the software solutions used by banks and credit unions to provide online and mobile banking services to their customers. This includes mobile banking applications, online banking platforms, payment processing software, fraud detection and prevention software, and other digital solutions that allow customers to perform banking transactions without having to physically visit a branch.

In many ways, the origins of digital banking transformations in banking and financial services can be traced back to the late 1990s when online banking started gaining popularity. In 1994, Stanford Federal Credit Union became the first to offer its customers an internet banking experience. Today, following rapid growth in popularity, digital banking is a crucial part of the financial industry.

Digital banking software can optimize the operational systems of banks and credit unions by reducing their operating costs. This could include the adoption of automated digital services, such as online account opening, indirect loan application methods to reach a larger volume of borrowers, and online bill payments. For customers, the many digital banking transformations we’re seeing provide convenience and accessibility, allowing them to manage their finances on the go from their mobile devices or computers. So, what forms of software are banks and credit unions using today?


Solutions Banks or Credit Unions Should Leverage

Digital banking can enhance overall security by providing multi-factor authentication, transaction monitoring, and fraud detection. It is one of the most important factors in the digital banking transformations of the modern age. Here are some of the top software options for financial institutions in today’s digital age:

Mobile Banking Applications: If you’re looking to enhance your customers’ online experience, apps are a great way to give them freedom and efficiency. Mobile banking applications are essential for financial institutions to provide a convenient and accessible experience to their customer base. They allow customers to access their accounts and perform banking transactions from wherever they have access to WiFi or phone service.

Payment Processing Software: Payment processing software is a must-have for financial institutions that need to process electronic payments and loan applications efficiently and securely. Take underwriting, for example. Having the right payment processing software can reduce the risk of human error.

Fraud Detection and Prevention Software: Fraud detection and prevention software are essential for financial institutions to prevent financial loss due to fraudulent activities. With loan fraud on the rise, it is crucial that banks and credit unions make sure they have a solid process in place to avoid becoming the next victim.

Artificial Intelligence (AI): Many banks and credit unions are now turning to artificial intelligence to take another step ahead in the digital banking transformation. AI can help banks and credit unions reduce the need to scale overhead costs and even gather valuable insights to optimize customer experiences. AI can be a very useful tool for providing customers with real-time and accurate answers to their questions without needing to sit on hold to speak with customer service representatives.


Where is the Industry Headed?

It’s a complicated question, but here are some of the biggest 2023 banking trends that financial institutions should keep their eyes on in the coming years.

Increasing Revenue Streams with Indirect Lending

Offering loans through an intermediary like Web Finance Direct can give banks and credit unions access to a wider, more qualified group of applicants. This allows dealerships and lenders alike to offer a better, wider range of loan options to applicants. Not to mention, applicants can have an easier, more enjoyable experience working with lenders who leverage technologies during the indirect lending process.

Software’s Role Should Continue Growing

Digital banking transformations support that the role of in-person banking is predicted to continue declining. When it comes to indirect lending, even eSignatures and facial recognition software are starting to evolve into a much larger role, allowing consumers to be approved for and sign loans on their phones or computers.

How Much Will AI’s Role Expand? 

AI is here to stay. As more proficient chatbots, such as ChatGPT, develop, banks and credit unions should continue to monitor how they can implement them in their day-to-day operations. According to an article from Business Insider, 75% of banks with over $100 billion that responded to a survey say they’re already implementing AI. The question becomes: how will it begin to take a stronger foothold over the banking world? And, will you be ready to keep up?


How Web Finance Direct Can Simplify Indirect Lending

For banks and credit unions looking to join a network of dealerships, Web Finance Direct has the answer. There are plenty of benefits, including leveraging technology across our F&I services to streamline the experience. So, how are we playing a role in digital banking transformations

We Find Your Bank or Credit Union Qualified Applicants

Efficiency is key in 2023. As a member of Web Finance Direct’s diverse lender and dealership network, we’ll do the hard work of finding qualified auto, marine, RV, or powersport applicants for your bank or credit union by opening the door to our robust dealership network. 

We Vet Every Application to Prevent Fraud

Equally as important as having the right software is a system for detecting loan fraud before it happens. We’ll help your financial institution do the proper due diligence to ensure every loan applicant is legitimate.

We Reduce the Amount of Paperwork

Overwhelming paperwork needs to be simplified in 2023. From working with each applicant to provide your bank or credit union with the proper documents needed to apply for a loan to giving you one report each year summarizing all the information of dealerships your bank or credit union has worked with, Web Finance Direct makes it easy.

If you’re looking to learn more about the benefits of joining our network, contact us to get in touch with our team of experts. You can also check out our blog to stay on top of all the trending topics in the world of digital banking transformations and much more.


What is the biggest challenge facing credit unions?

The current economic uncertainties have made it very difficult for banks and credit unions to find new members and loan applicants.

What are some digital financial services?

When you hear digital financial services, think of things like mobile banking and innovative payment processing software or credit union technology.