Mobile Lending: An Extension of the Internet Channel

Consider the impact, that mobile banking will have on something as basic as Internet loan applications. Consumers prefer experiences that are optimized to their smartphones, as indicated by the fact that 24% of online applications come from mobile devices (smartphone or tablet) for credit unions with a mobile presence. According to a CUNA Mutual Group white paper, 90% of credit unions have an Internet loan application. You have to assume that these are inevitably being accessed by mobile devices with a screen about one-tenth the size of a desktop/laptop. Have you considered the user experience of your members? Is your website mobile-optimized? It’s all about content and usability!

According to Google, if your website is not mobile-optimized…

•       48% of customers will believe you don’t care about them

•       40% will go to your competitor’s website, and

•       1 in 6 will switch to another financial institution

Credit unions must meet customers where they are, through optimized channels they need and increasingly demand. This is the marketplace today; location is no longer about being at a major intersection or near the newest mall.  It means being available 24/7 and ensuring your services are both optimized and maximized for mobile access.

Non-optimized vs. optimized loan applications

Optimize your mobile access for all phones and tablets. This includes ensuring website links are easy to locate and use. Now, whether your site is optimized or not, Internet lending applications are being attempted on smartphones and tablets. Offering member-focused benefits like mobile alerts and iPad and mobile-phone-specific apps also has strong Gen Y appeal.  Alerts can also be set to notify customers of a low balance, new loan rate changes, and other features.

Other opportunities To Grow Loans Via Mobile

Social Media.

A primary means to engage Gen Y, or Millennials, is through social media.  And many credit unions have begun targeting new members through social media. There’s an opportunity to grow social media efforts that will drive sales because social media users are very likely to conduct financial transactions via smartphones.  In fact, 65% of U.S. smartphone owners use push notifications for social alerts. Social Media is also a tremendous way to engage customers and learn both their needs and their feelings toward your products and services.  In this way it is more than just a marketing tool.

Auto Loans

Did you know that 31% of consumers use smartphones during the car-buying process?  Members are using their smartphones to research the car they want to buy.  With a mobile loan application, you will enable them to continue the auto buying process to obtain the loan – possibly while they are still on the lot.  With a mobile loan application, members can apply for loans anywhere, anytime and on any device.   

The "Smart" credit unions will think about the member's smartphones at every touchpoint.  Its the member's preferred means of information gathering and their lifeline to the rest of the world - and you're products.

Yvonne Sambrano

Sr. Lending Product Manager

EPL, Inc

Gen Y and mobile loans: Are you optimized to profit?

All credit unions are looking to increase lending, but if  you want to be successful,  you need to evolve with the newer generations.  The way you made loans 10 years ago just won’t fly with Gen Y. It’s all about faster, easier access. It’s all about smartphones. It’s all about  optimizing your credit union to grow your loan portfolio! Let’s look at two key factors that will affect your loan portfolio in the coming years, Gen Y and mobile loans.

Who is Gen Y (also known as Millennials)?

•       Born between 1981 and 2000

•       Current age is 14 to 33

•       Largest consumer group in U.S. history

•       90% use the Internet

•       75% use social networking sites

       

Millennial Expectations (faster, faster, faster)

•       Embrace emerging technologies

•       Require convenience

•       Want instant gratification

In this day and age, nothing answers the call for instant gratification and technology-linked convenience like the smartphone.

Smartphones are changing everything.

How many of you check your phone for messages, email or the latest news the first thing upon waking up each morning? Well consider this: For approximately 88 million people, the first thing they do each morning is use their smartphone. In fact, 90% of 18-29 year-olds sleep with their smartphone within arm’s reach! Smartphones are a huge wave taking over our personal and business lives. They are the next wave in lending as well. 

This reliance on smartphones is dramatically changing the way credit union members conduct their financial business:

•       Branch visits average 3-4 per year

•       Internet visits average 7-10 per month

•       Mobile visits average 20-30 per month

Branch visits are down; mobile visits are way up! The shift toward mobile banking is upon us and the  number of people who buy via mobile device will increase 65% between now and 2016.     

Credit unions cannot afford to ignore the Millennials.

“Their collective buying power alone—an estimated $200 billion annually—is already noteworthy and will only increase as they mature into their peak earning and spending years,” report Jeff Fromm and Christie Garton in their book, “Marketing to Millennials: Reach the Largest and Most Influential Generation of Consumers Ever.” If you don’t offer a mobile means to access loans, you are missing out on a huge demographic: Generation Y. What  is your  credit union doing to cater to them? Mobile lending is here. Are you ready for it? Not having a mobile optimized loan application can cost you 25% of your online volumes. How are you preparing for the mobile needs and expectations of your members? What credit union products and services could/should be delivered to mobile devices?  If you have not already considered these questions,  you should!

Yvonne Sambrano

Sr. Lending Product Manager
EPL, Inc