By Kristopher Kovacs, President & CEO, Constellation Digital Partners

Today, more and more credit unions are evaluating whether to convert their digital banking platforms. There could be a host of different reasons driving this consideration, from expiringexisting contracts with current providers; to dissatisfaction with existing services; to simply a desire to explore newer, better alternatives. Regardless of the reason, credit unions are also likely to face some challenges and risks in these transitions. So how can credit unions best avoid choppy waters and ensure a smooth conversion?

Start With a Focused Digital Strategy

For credit unions facing an upcoming contract expiration or renewal, this provides a perfectopportunity to reevaluate their own digital strategy and potentially seek new solutions that better support their strategic initiatives of enhancing member experience, generating revenue andreducing expenses. Too often, however, we see credit unions treat their RFP process as a substitute for their digital strategy.

Many of these same credit unions tend to fall into the trap of chasing the “perfect” platform based on one or two very specific functionalities. The unfortunate reality is that this usuallyleads to a perpetual quest – and ongoing frustration for the credit union. An effective conversionshould not hinge on an individual piece of functionality, and rather than chasing this “white whale,” credit unions should prioritize a strategic approach that centers on digital enablement, service expansion and operational efficiencies – ideally with a partner that provides the credit union with more control over its digital roadmap moving forward.

Mitigating the Risks and Challenges of Member Adoption and Engagement

One of the key measures of success for any conversion is member adoption and engagement with the new platform. Likewise, it can also present some of the biggest challenges and risks for any transition.

A common pitfall is the desire to please everyone. Credit unions by their nature want to provide the best service for all of their members, so it is understandable that this would extend to any new platform. However, even with the most cutting edge, robust system available, it is highly likely that some percentage of a credit union’s member base is not going to like it, whether based on perceived need, level of functionality or even just resistance to change.

To better overcome this, credit unions should consider approaching any conversion as a gradual transition, one that eases members into the new experience. Before diving into functions like transactions, focusing on a few, simpler initial features allows members to better acclimate to new functionalities prior to any monetary transactions (which represent a much bigger leap in many members’ minds).

Another key consideration is the question of timing. Often when a credit union converts to a new digital banking platform, the change occurs all at once, usually overnight. The entire system’s look and functionality changes, which can lead to confusion, distrust, or even anger from somemembers, which could potentially lead to them leaving.

An effective method that addresses both of these concerns is to leverage a companion appstrategy prior to the full conversion. By initially releasing a companion app with limited servicessuch as debit/credit card controls, budgeting, p2p payments or financial education in advance of the full implementation, the credit union can better introduce changes gradually. This allows members to become familiar with the platform’s feel and features, which will help create a smoother transition when the final conversion occurs. Plus, by enrolling into the companion app, those same members could also now be enrolling into the new banking application, making the complete conversion process much faster and easier, while significantly helping to boost member adoption rates.

In addition to technology considerations, converting to a new digital banking service will likely require additional staff resources in the form of call center and support resources to handle the expected increased volume of help requests from members. Effective communication is critical for the success of any digital banking conversion, and over-communication is key when it comes to member outreach. Credit unions must utilize every available channel to repeatedly inform and engage members about the upcoming changes. Interactive tools and calls to action can significantly help enhance member involvement and understanding, boosting adoption rates and future engagement. By taking a more gradual, thoughtful release approach, credit unions can dramatically increase the acceptance curve on the day of launch.

Digital banking conversions are significant undertakings for credit unions but are increasinglynecessary for them to remain competitive in the modern financial landscape. The key to a successful conversion begins with assessing how any transition fits into an overall digital strategy. By focusing on this approach and considering the unique needs of their member base, credit unions can better navigate these challenges and provide their members with a more efficient, engaging digital banking experience, one that meets – or better yet, exceeds -- their evolving expectations.

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Kris Kovacs is Founder and CEO of Constellation Digital Partners (Constellation), a leading provider of digital banking solutions that enable credit unions to deliver a unique and customized digital banking experience to their members. Constellation’s patented, open development platform allows credit unions to pursue innovative fintech services at the pace of their individual digital strategy.