Filene Fellow Dr. Lamont Black explores AI's transformative role in the Credit Union of the Future

This is a guest post from Filene's "The Credit Union of the Future" Center of Excellence. Read Part 2 in this series, Seven Steps for AI Adoption in Credit Unions.

Are you ready to harness the potential of artificial intelligence (AI) for your credit union? We’re in the midst of a technological revolution that promises to reshape just about every industry, including the financial services industry. AI is no longer just a buzzword; it's an essential tool for credit unions aiming to stay competitive and provide exceptional member experiences.

In my work as an Associate Professor of Finance at DePaul University and Lead Fellow at Filene Research Institute’s new Center of Excellence, The Credit Union of the Future, my team and I study AI implications in the financial services sector and how credit unions can leverage AI technology to improve operational efficiency and enhance member value.

Filene Center of Excellence (CoE): The Credit Union of the Future

Our CoE’s latest report, “The Evolution and Impact of AI in Credit Unions,” delves into how the growing adoption of AI will not only transform delivery of member-facing services, but also empower employees and leadership within credit unions to make more informed decisions and identify operational efficiencies.

In this article, we’ll briefly touch on how AI is transforming the industry, from personalized member services to operational efficiencies. In Part 2 of this article, coming soon, I’ll offer practical steps for AI implementation in your credit union. 

The Rise of AI in Financial Services

AI's impact on financial services is already undeniable. Credit unions are now leveraging AI technologies like chatbots, predictive analytics, and machine learning to revolutionize member interactions and decision-making processes. Understanding the potential of AI — and taking practical, proactive steps to adopt it — is crucial for credit union executives looking to innovate and improve their services.

Member-Facing Applications

Personalized Services

AI allows credit unions to tailor services to individual members. By analyzing behavioral data, AI can recommend products and services that align with each member's financial goals — for example, a member receiving personalized loan offers based on their spending habits and credit history.

Understanding Members

AI enables credit unions to understand their members better. With sophisticated algorithms, AI can analyze member data to predict future needs and preferences. This deep understanding helps in creating more meaningful interactions and personalized experiences.

Predicting Member Journeys

Knowing where a member's financial journey is headed allows credit unions to proactively offer solutions. Predictive analytics can forecast life events like purchasing a home or saving for college, providing members with timely advice and services.

Employee-Facing Applications

Empowering Employees

AI tools empower employees by giving them instant access to a rich knowledge base and real-time member data. This enhances their ability to serve members effectively and efficiently. Employees can focus on higher-value tasks while AI handles repetitive, mundane tasks.

Training and Development

AI can also be used for employee training and development. Personalized training programs powered by AI help employees learn at their own pace and retain information better. This results in a more skilled and competent workforce.

Streamlining Tasks

Routine tasks like data entry, appointment scheduling, and document verification can be automated using AI. This not only reduces the workload but also minimizes errors, leading to a more efficient operation.

Leadership Applications

Identifying Frictions

AI helps leaders identify and address operational frictions in multiple realms. One example is analyzing audio transcripts from contact centers, allowing for quick resolution of recurring issues, improving overall member satisfaction and internal processes.

Enhancing Decision-Making

Leadership teams can leverage AI to make informed decisions. By analyzing large datasets, AI provides actionable insights that help in strategic planning and risk management. This can lead to more effective leadership and a stronger credit union.

Driving Strategy

AI-driven insights enable leaders to craft data-backed strategies. Whether it's launching a new product or entering a new market, AI helps in making decisions that are both innovative and grounded in data.

But How Do I DO It?

It’s one thing to agree that something is a great idea, and another to actually dive in and pull it off. By now, I’m sure you are aware that AI is here whether we’re ready for it or not, and are wondering how to implement it in the real world of your credit union.

Stay tuned for Part 2 of this article: “Seven Steps for AI Adoption in Credit Unions.” There, I’ll share some practical steps for making your AI strategy a reality.

Want to learn more?

To download the full research report The Evolution and Impact of AI in Credit Unions, as well as a wealth of other credit union resources, consider becoming a Filene member, with full access to all reports and research as well as events and other opportunities to connect with high-performing, forward thinking credit unions dedicated to innovation and improving lives.

You can also access this full research report as part of State National’s industry-exclusive sponsorship with Filene. The report also includes a link to a webinar hosted by Dr. Black, Filene EVP Christie Kimbell, and John Best, CEO at Best Innovation Group, that explored the growing adoption of AI in a business context and shared specific use cases within the credit union industry.

"State National is a proud sponsor of Filene's Center of Excellence for The Credit Union of the Future. We recognize the value of Filene’s commitment and passion — and it makes this respected organization a clear choice as a thought leadership ally to help State National support our credit union partners." 

You can also connect with Dr. Black on LinkedIn for insights into his upcoming research.