CU’s most valuable crypto asset is education
Cryptocurrencies have risen in popularity since they were introduced in 2008, achieving record growth last year. PYMNTS’ research shows that the percentage of consumers holding crypto rose from 16% in 2020 to 23% in 2021, and this percentage is even higher among credit union members. A recent report by the Credit Union National Association (CUNA) found that 39% of CU members owned cryptocurrencies, compared to just 17% of non-members. CU members are also seeking more innovation from their financial institutions (FIs), with nearly a quarter of CU members saying they would take their business to another FI to get the innovative products and services they demand.
Credit unions have rightly been wary of continuing with innovations in the crypto space. Market volatility, lack of a regulatory framework and absence of liability protection are a few reasons holding back the widespread use of crypto in financial services. Still, with 91% of members looking to their CUs for financial advice and guidance, credit unions have an opportunity to help members diversify their portfolios while educating them about the responsible use of cryptocurrencies.
This edition of the “Credit Union Tracker®,” a PYMNTS and PSCU collaboration, takes a closer look at some of the emerging trends in the crypto landscape, as well as some of the major barriers preventing its adoption in financial services.
Around Credit Union Space
A CUNA economist warns that credit unions need to better advise their members about the risks of investing in cryptocurrencies and using digital currencies for financial transactions. Recent CUNA data shows that CU members are more likely to own cryptocurrencies than the general population, and senior economist Ligia Vado warned that the lack of regulatory oversight for digital currencies puts users at higher risk due to potential fraud and misconduct. A recent CUNA survey found that 39% of credit union members owned cryptocurrencies versus 17% of non-members.
Credit unions that want to maintain relationships with the 131 million members who use them must meet their expectations for both personal service and immediacy, according to a recent report. About 80% of survey respondents indicated that they want an FI that knows their financial needs on a personal level. At the same time, the report said there is a significant opportunity for CUs to enable instant, online self-service options for members to take care of all their financial needs, such as opening accounts or activating new cards. In addition, connected experiences that use available member data for cross-channel personalization can help optimize member retention and satisfaction, the report states.
For more on these and other stories, visit the Tracker’s News and Trends section.
Visions of Federal Credit Union to build crypto competence
Credit unions are in a unique position to help consumers as they enter the world of cryptocurrency and digital assets, according to professionals at Endwell, New York-based Visions Federal Credit Union. Joe Keller, Vice President of Digital Assets, and Cynthia Schroeder, Senior Vice President of Digital Assets, work to make cryptocurrencies and digital assets more consumer-friendly. CU’s commitment to its role as an educator doesn’t stop at ensuring staff and members can use these tools, however: VFCU also works to build industry awareness and current crypto literacy.
To learn more about VFCU’s and CU’s role in promoting crypto literacy, read Tracker’s Feature Story.
PYMNTS Intelligence: How credit unions can meet member needs with cryptocurrency services
CUs must decide how and when to offer services in a currency that is still in its infancy. About 16% of CUs plan to offer cryptocurrency investment or trading in 2023 or later, according to a report, and 11% expect to offer cryptocurrency rewards during that time. However, current offerings are at a much lower level, with only 4% reporting plans to implement cryptocurrencies in 2022. Meanwhile, a third of CUs said they have no plans to offer blockchain solutions. With so much member interest, one might wonder why more CUs aren’t rushing to offer cryptocurrency services, but valid concerns remain.
To learn more about CU’s role in enabling their consumers to navigate cryptocurrency risks and opportunities, read Tracker’s PYMNTS Intelligence.
About Tracker
The “Credit Union Tracker®,” a collaboration between PYMNTS and PSCUexplores the latest news and developments in the credit union space.
