Technology can unlock further, much-needed support for people in our community who are struggling to get by, but it needs to be targetted in the right place. We believe that partnerships can be part of the solution to support those financially excluded in UK society.
We have found six specific areas where technology could help social and community lenders to grow and have a greater impact:
- Frictionless workflow – Creating products with a more streamlined experience. For example, allowing faster decision-making and smoother ‘onboarding’ of new customers, while reducing drop-offs along the way.
- Customer/member acquisition and management – Using digital marketing tools and approaches such as customer relationship management systems, search engine optimisation and segmentation to cost-effectively target and reach new customers.
- Scalable solutions – Approaches that could lower transaction costs, such as shared platforms or blockchain/distributed ledger technology-based systems. This could involve consolidation and/or new approaches to payment processing, e.g. where back-end technologies are shared across multiple smaller organisations to achieve better economies of scale for all.
- Digital experience (UI/UX) – Offering greater immediacy, personalisation and a better customer experience through simpler, cleaner, and responsive design (that works well across mobile devices).
- Integration – A recurring criticism we heard about the existing systems credit unions use was the lack of integration with other third-party systems, such as open banking, payroll and benefits systems. Better integration could help credit unions (CUs)/Community Development Financial Institutions (CDFIs) verify customers’ identification, inform lending decisions or offer automated payments through employers’ payroll.
- Analytics/Artificial Intelligence (AI)/data science – Although CUs/CDFIs generate a wealth of potentially insightful customer data, fintech partners could potentially assist in turning this data into actionable insight. This might be through improved verification, decision-making analytics, or automated AI/chatbots to improve customer journeys and user experience.
