Who is the real competition for communitybanks and creditunions? Even McKinsey & Company gets it wrong.
A recent article published by McKinsey consultants entitled "Six imperatives for credit unions to secure their future" listed a rather bland list of platitudes about how Credit Unions need to change to survive and basically boiled down to the need to attract younger generations especially GenZ.
Little lite on the how though.
What was most striking though was that they failed to include the greatest threat to traditional banking in attracting and retaining younger customers and their deposits. Fintech companies like Robinhood, Coinbase and Wealthfront and Investment Platforms like Charles Schwab and Fidelity Investments.
These companies have progressively been rolling out new banking services including high yield checking and saving accounts, debit cards and credit cards and ancillary marketplace services to compliment their investment platforms. Consumers have been flocking to these new hybrid platforms opening new accounts and sending their deposits to them to maximize their returns and to minimize the complexity of having multiple money apps on their phones.
Ignoring these new competitors and failing to learn from their example is possibly one of the largest threats to the long term future of community banking.
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