Once considered adversaries vying for the future of consumer banking, credit unions (CUs) and FinTechs are transforming their relationships.
The PYMNTS Intelligence report “From Rivals to Partners: The Rise of Credit Union-FinTech Collaboration,” a Velera collaboration, found that this pivot is largely fueled by escalating member expectations for robust mobile banking and seamless digital payment solutions, which in turn offer CUs growth opportunities at scale.
The shift from competition to collaboration is seeing CUs become FinTech clients. In November 2023, 16% of FinTechs that engaged with CUs viewed them as rivals. By November 2024, that figure plummeted to 1.9%.
Over the same period, the share of FinTechs identifying as vendors to CUs soared to 98%. FinTechs’ growing recognition of CUs’ desirable attributes as customers includes the fact that these banks have decades of history as member-first models and a stable, loyalty-driven consumer base.
For their part, CUs perceive FinTechs as essential technology providers, not market disruptors. Only 12% of CUs named FinTechs as top competitive threats, a contrast to the 35% who cited other CUs or community banks.