Credit Unions’ Remote-Banking Market Shares

By Jon Haller
Director of Market Research
Credit Union National Assn.

Over the past decade – lead originally by the introduction and subsequent major growth in consumer adoption of online banking – financial institutions have been investing heavily to establish, maintain, and enhance additional remote-banking delivery channels to serve their customer bases.

Consumers today have multiple options for making electronic bill-payments – whether through a financial institution’s bill-pay service, a bill consolidator’s offering, the biller-direct route, or through automatic deductions from checking accounts.

Nearly all member households have a checking account somewhere, while half use Internet banking, and somewhat fewer pay bills electronically via the Internet/e-mail. This, according to CUNA’s soon-to-be-released 2006-2007 National Member Survey Report (available in June).

Members with household incomes of $75,000 or more are stronger users of Internet banking than are those in other income groups, and those earning $100,000 or more are the income group most likely to pay bills via the Internet/e-mail.

Turning to the use of credit union convenience services, we find that half of member households have a checking account at a credit union, while one in four turn to their credit union for their online banking needs, and about 15% rely on it for their bill-pay services.

A review of members’ use of these three services elsewhere reveals that they are somewhat more apt to be using each of these services at other providers than at the credit union, yielding credit union market shares that fall below 50% for all three services.

The National Member Survey Report, though, reveals that credit unions’ market shares for the three services is quite high among their checking users, PFI members, and “truly loyal” members.

Sizeable percentages of members who currently use the major remote-banking options – check cards, online banking, and bill-pay services – are employing these channels more so than they were a year ago. As such, credit unions should be prepared to invest additional financial, human, and/or technology resources to support members’ growing use and frequency of using these channels.

• Click here to be notified by e-mail when the 2006-2007 National Member Survey Report becomes available in early-June.
• Click here to be notified by e-mail when the 2006-2007 Survey of Potential Members: Opportunities and Challenges in Growing Your Membership Report becomes available in late-June.

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