Hosted by top 5 banking and fintech influencer, Jim Marous, Banking Transformed highlights the challenges facing the banking industry. Featuring some of the top minds in business, this podcast explores how financial institutions can prepare for the future of banking.
The economy has been top of mind for consumers throughout 2022 and into 2023. In a survey by PSCU, nearly nine in ten consumers stated they were worried about the economic outlook, while three-quarters also reported they were concerned about their personal finances.
In response to economic uncertainty, consumers want choice and variety when making purchases and transacting. In fact, most consumers said they are using a greater variety of payment methods than they did a few years ago, including digital payment options.
We have Tom Pierce, CMO of PSCU on the Banking Transformed podcast. He shares the results of the most recent Eye on Payments study done by PSCU and provides insights into how financial institutions can better serve members and customers.
This episode of Banking Transformed Solutions is sponsored by PSCU
Through this annual research, discover how PSCU explores the factors that influence consumers when it comes to their choice and usage of different payment methods, how these factors may vary among different life stages and economic events, and how credit unions can better serve their members and optimize their offerings to adapt to these evolving preferences and needs – both now and in the future.
Hello, and welcome to Banking Transformed, the top podcast in retail banking. I'm your host, Jim Marous, founder and CEO of the Digital Banking report and co-publisher of The Financial Brand.
Jim Marous (00:20):
The economy has been top of mind for consumers throughout 2022 and into 2023. In a recent survey by PSCU, nearly 9 in 10 consumers stated that they were worried about the economic outlook. While three quarters also reported they were concerned about their own personal finances.
Jim Marous (00:41):
In response to economic uncertainty, consumers want choice and variety when making purchases and when transacting. In fact, most customers said that they were using a greater variety of payment methods than they did just a few years ago, including digital payment options.
Jim Marous (01:00):
We're lucky to have Tom Pierce, CMO of PSCU on the Banking Transformed Podcast. He'll share the result of the most recent Eye on Payment study done by PSCU and will provide insights into how financial institutions of all sizes can better serve members and customers.
Jim Marous (01:20):
For the fifth year in a row, PSCU set out to gauge a payment preferences among credit union members and other financial institution customers. They explored the choice and usage of different payment methods, how these choices varied among different life stages and economic events, and how financial institutions could better serve their members and customers, both now and in the future.
Jim Marous (01:44):
So, Tom, tell us a little bit about the history of the PSCU annual Eye on Payment study. Why is the study done and what are some of the most significant megatrends you've seen over the past five years?
Tom Pierce (01:59):
Well, thanks, Jim. Let me talk a little bit about the history of this study, then I'll talk a bit about some of those consistent trends we've seen.
Tom Pierce (02:05):
So, we launched Eye on Payments in 2018, really is a focus to gauge the traditional emerging payments preferences and behaviors amongst both credit union members and also, amongst bank customers.
Tom Pierce (02:20):
So, we've had consistent questions throughout the years looking at debit and credit card usage, but we've also focused on some of the trends and changes from the emerging payments perspective. Obviously, during COVID, we saw a lot of adjustments and behaviors and people changing how they use their payment forms.
Tom Pierce (02:39):
And then we've also added in new twists to the study every year. But let me talk a little bit about some of those trends that we've seen. So, except for the very first year when we saw credit as the preferred payment method, debit has been the lead in the last four years of the study.
Tom Pierce (02:55):
We've seen shifts happen during the pandemic to interest and contactless cards, mobile wallets, as people wanted that cleaner experience at the point of sale. And that's stuck around since then. Additionally, we've seen consumers continue to prioritize ease of use speed and convenience with their payment types.
Tom Pierce (03:17):
And they've been focused on security throughout. They want a safe way to pay. So, these have been some of the core trends that we've seen throughout the five years of the Eye on Payment study at PSCU.
Jim Marous (03:28):
So, what was the standout trend you saw in 2022, the study you did then? And how are financial institutions, both credit unions and traditional banks responding to these trends?
Tom Pierce (03:41):
Yeah, well, we saw a lot of findings from this year. I think the lead one has really been around the continued demand for choice and variety when it comes to making payments and transacting. So, a majority of consumers said they're using — and that's about 61% said they're using a greater variety of payment methods than a few years ago.
Tom Pierce (03:59):
So, while they're using debit, credit, and cash, about 75%, they were using those, we've seen a growth in digital payment methods. We could talk further about that as we have the conversation today. Approximately 4 in 10 expect to use a mobile wallet or store specific mobile payment app to pay for goods or services at the point of sale.
Tom Pierce (04:18):
So, people are wanting choice. They want to be able to select the type of payment method at the point in time, whether it's online or at the point of sale that's most convenient and easy to use for themselves.
Jim Marous (04:31):
So, when you look at the economy right now, it's very uncertain and it's put a lot of people into a concern around their own financial wellness. How have you seen that impact: how people are buying, how they're paying and how they're transacting?
Tom Pierce (04:49):
So, this year, we did specifically dive into that question about the impact of the economy on consumers' payment behaviors. And when we fielded the survey, almost 9 out of10 respondents, 87%, said they were worried about the economic outlook and about three quarters reported they were concerned about their own personal finances.
Tom Pierce (05:07):
So, clearly top of mind. But we saw some differences in how different income levels were choosing to pay. And it kind of makes sense: the lower or lesser income folks are choosing to pay more so at least from a preference standpoint with debit, because they don't have as much credit built up.
Tom Pierce (05:27):
Similarly, for the above average household perspectives, they're spending more with credit because they've got more opportunities to dive into that standpoint.
Tom Pierce (05:38):
We're also seeing a potential increase here in delinquencies and disputes, which we're seeing more consumers saying they're disputing transactions which is going to be interesting to follow as to whether that growth is driven by actual not receiving of products or it's actually being driven by what we're calling friendly fraud, where consumers are disputing charges because they can't pay for them and still getting the products.
Tom Pierce (06:04):
So, it'll be very interesting to watch on that standpoint. Some of the more significant impacts have come, again, think in the youngest generational cohorts. So, those younger millennials and Gen Z that are most concerned about how the economy's impacting their ability to pay.
Jim Marous (06:17):
Yeah, it's very interesting because as you said, it's impacting everybody differently and to different degrees. And it's interesting too, I sense that overall, consumers are really shopping more for different options.
Jim Marous (06:35):
It was interesting, as a side note, my son called me and said, "I'm looking to get another credit card. I want to make a major purchase and I'm trying to find the credit card that I'm going to get the biggest credit limit and still get cash back rewards. But I can't really afford (not money-wise) to have like somebody come back and only give me $500. I need more than that for what I'm trying to do."
Jim Marous (07:03):
He has good credit and all that, but he has a short credit history. I sense there's a lot of people today shopping for that right credit or debit option for them. Is that what you find as well?
Tom Pierce (07:17):
Yes. I mean, I think while we track every year what's driving people to choose a certain type of credit card, they've shifted where before from the rewards basis, they were looking at points, building that travel side, looking for points to buy items.
Tom Pierce (07:35):
We've seen a biggest shift the last few years to wanting cash back. That's the biggest driver of what card people are choosing, as well as how big a credit limit they can get based on their available credit lines. But I think you're spot on with what your son was talking about.
Jim Marous (07:51):
Well, yeah, and it's interesting because his search was unrestricted cash back. He doesn't want to have to worry about categories and things of that nature because the purchase he's going to be making is probably in a bigger category that is not food or entertainment or one of the typical ones. So, it's going to be interesting.
Jim Marous (08:13):
What do you see as the key differences in payment preferences between generations right now?
Tom Pierce (08:20):
Yeah, I'll highlight a few of those pieces, Jim, because it's fun to kind of look at — and we really track towards kind of five different categories of generations we look at. We've got of course, the boomers, the Gen X folks we look at and kind of split the older and younger millennial folks and then the Gen Z folks.
Tom Pierce (08:39):
So, when you look at the boomers these folks were concerned about the economy 90%. But only about 70% were concerned about their personal finances because they have more to fall back on. We've seen a balanced approach to their preferred payment method, about 39% debit, 40% credit, so pretty even on that front. And we've seen growth in their use of contact list over the last several years.
Tom Pierce (09:05):
So, as they become more familiar with that payment type and it's more accessible to use of the point of sale, they're beginning to shift to that. The Gen Xers this past year were more debit-leaning. We saw about two thirds of those folks using a greater variety of payment methods than a few years ago. And for that generation, trust and relationships are really key as they determine which FI they work with. So, very important to tap into that factor.
Tom Pierce (09:30):
Now, when we look at the millennials folks, the older millennials, these were the most frequent users of some of those digital payment methods. So, Venmo, PayPal, and then this was also the group that has invested the most in crypto. 37% say they've either invested or currently hold crypto. Now, we'll see if that continues with the crypto winter we have going on right now in some of the collapses.
Tom Pierce (09:53):
And also, this group has had stronger interest in the metaverse. So, about 30% said they have participated in a metaverse or metaverse-like experience. So, interesting to watch that emerging payment side with that audience there.
Tom Pierce (10:07):
Younger millennials — this is that group that's focused on building credit, gaining financial security. 80% of those say they prefer to use a credit card to build their credit. Maybe that's what your son's looking to do there. And they also are the most prolific users of mobile wallet technology and the most likely to use a buy now, pay later program.
Tom Pierce (10:27):
So again, different findings for that group. And then Gen Z and as I mentioned before, this was the group that was the most concerned about their finances with the economy. They're still using debit as a preferred payment form because they don't have the available funds from a credit perspective, and they're also the most significant users of mobile apps for shopping and food ordering.
Tom Pierce (10:48):
So, some interesting distinctions between the different groups, Jim.
Jim Marous (10:52):
When you look at this, do we run the risk as a financial institution of maybe depending on categories as opposed to individual preferences? For instance, you discussed the millennials and either the millennials or the Gen Zs — I'm probably from my payment process more like them than I am my own demographic group.
Jim Marous (11:14):
I simply use mobile pay for virtually everything. I actually select vendors and retailers that allow mobile payments. I pick restaurants based on that. I don't want to carry cash, I want to carry cards. I want to do everything mobile. So, that's a little bit interesting. I buy most of my items online.
Jim Marous (11:35):
So, do financial institutions have to double down on the data and analytics to find out the preferences of individual members or customers more than maybe they have in the past and not depend on simply what I call traditional demographics?
Tom Pierce (11:52):
It's a great point. When we look at these kind of trends that have these fun discussions about the different demographic categories, it really comes down to the individual consumer, that individual member and how they're paying. And we like to call it at PSCU, connected experiences.
Tom Pierce (12:05):
So, we really encourage our institutions to look at the data in terms of how those individual consumers are either preferring to pay, are they using a mobile wallet more? Are they turning on certain fraud protections under that mobile wallet from an alerts controls perspective? Are they choosing to have a debit or credit card at the top of wallet status in there?
Tom Pierce (12:29):
Those data points should really drive your engagement with the individual consumer and prompt them down certain pathways. So, we try to provide those tools and capabilities to the credit unions that we serve in the marketplace. But we've seen a lot bigger focus on that from credit unions and banks, obviously, as the individual needs of consumers change.
Jim Marous (12:50):
It's interesting, I talk in a lot of my podcasts and some of the writings I've done recently about the fact that there's silent disintermediation. That organizations think they have the same customer base they did in the past without really realizing that while they may have the accounts, the consumer's loyalty or commitment to them has diminished a bit because people have opened accounts elsewhere.
Jim Marous (13:16):
You talk about it in your report when you say that there's an importance of going away from or going beyond share of wallet to basically going towards share of mind. Can you describe that a little bit and how can this best be achieved?
Tom Pierce (13:35):
That's a great point, and we did kind of shift from that direction and it kind of plays off what we just talked about, that connected experience side. So, it's important for credit unions to really meet their members in their channels of choice. They're expecting higher levels of service and a variety of offerings.
Tom Pierce (13:51):
They want to have the choice between using the traditional credit card, but having the digital payment capabilities, having an option for BNPL if that's what they want to choose or go on a path with. So, it's essential that as you offer these various choices, your institution becomes that top of mind for who to work with.
Tom Pierce (14:14):
Because if not, if you're not offering this variety of payment types to meet their needs, they're going to cherry-pick and choose to go to a different financial institution, at least for part of it. That's why we've seen some of the growth in some of the digital banks because they're offering some of these easy-to-use digital capabilities and it's important for credit unions to invest in these channels to make sure they retain that full share of mind for their audience.
Jim Marous (14:40):
So, what are some of the newer ways that credit unions and other financial institutions are rethinking their payment alternatives to meet the needs of customers? Are they still looking at new payment innovations and developing new products to serve these, I'm going to call them microsegments.
Jim Marous (14:55):
They're not micro, but the reality is for any institution, they may be micro compared to other alternatives or are they sticking with the traditional product lines?
Tom Pierce (15:06):
So, we're seeing further interest of those. We're not seeing necessarily is credit unions wanting to always invest in these opportunities on their own.
Tom Pierce (15:16):
We just finished a study separate from Eye on Payments looking at credit union's desires to innovate to serve the needs of their members. And there's still a disconnect between what members are wanting in terms of advanced digital payment opportunities (buy now, pay later, mobile wallets, others) and where credit unions are actually investing their dollars.
Tom Pierce (15:35):
And we've seen a bit of a pullback in that approach particularly since the economy started to decline. So, there's been a pullback and we've seen more credit unions reporting themselves as being more laggers than maybe they were before.
Tom Pierce (15:50):
And it's a big concern for us, and it's something we really push our audience base on for the credit union perspective, that this is not the time to step back. You need to keep investing in these additional payments capabilities.
Tom Pierce (16:01):
Now, because consumers are going to make other choices, and as we come out of this economic downturn, you've got to be ready with the most poignant types of options for your members or they're going to turn to somebody else. They don't have the loyalty they once had. And so, investing in these new solutions.
Tom Pierce (16:21):
And an upcoming one I want to mention as well Jim, is we're looking of course, at the upcoming FedNow service that's going to end up creating instant payments capabilities that's forecast to hit the market this summer with a number of institutions including PSCU's Juniper Payments, being able to start to test some of those capabilities.
Tom Pierce (16:41):
That will become a disintermediary to the debit and credit traditional choices from payments standpoint. So, credit unions are going to have to have a seat at the table from that standpoint if they want to retain that full top of mind share that we just talked about as a new payment.
Jim Marous (16:58):
You brought up a very good point. It was underlying your comment a little bit there, that finance institutions now more than ever, they have the ability to partner with outside third-party providers that can keep them up to speed and future-ready.
Jim Marous (17:10):
They need to double down on that because without those partners, you can't do all this innovation on your own. In fact, you certainly can't do it at speed and scale. And working with a company like PSCU, an organization like PSCU makes it so that you can actually leverage the intelligence and the efforts that you're putting into keeping organizations ready in the payment space.
Jim Marous (17:36):
And as you said, you can't afford to fall behind because playing catch up is not the way to go. It's interesting too because just because you have these products doesn't mean that members and customers know you have them.
Jim Marous (17:53):
I was really impressed yesterday, and again, my little side note on my experience with my son yesterday, when I looked up and said options for rewards programs and with modest credit history. What is interesting is we got into the Capital One site and their ability to present their options was enormously intelligent.
Jim Marous (18:19):
It would ask you a few basic questions: what are you looking for? And then they'd show you the option of cards they had for those solutions. I think it's important for financial institutions not to put credit cards or debit cards on the back burner, not to make it so that you just figure, "Oh, consumers will find what they want."
Jim Marous (18:37):
They want help in trying to decide what to take advantage of, what to apply for. They want you to help them with their decision. And the only way to build this kind of platform that works is really with a third-party provider such as PSCU. You just can't go it alone.
Jim Marous (18:57):
When you look at this overall, and you've mentioned a couple times about buy now, pay later — should traditional financial institutions be concerned about this payment option going forward?
Tom Pierce (19:09):
So, clearly, there's a demand for it. I mean, particularly amongst the younger audience. And maybe economic concerns are a contributing factor with that right now. But what we found for this study is of those who know their FI offers BNPL solutions, 60% are saying they've used it.
Tom Pierce (19:26):
And younger millennials, as I mentioned before, are the most prolific users of those. The challenge is, is how do credit unions get into this space without causing growth and credit challenges for their members? I mean, some of the newer entrants in this space, the Affirms, the Klarnas, they're offering these opportunities, but it's causing folks to default on things, and they're getting a lot of looks from the CFPB and so forth.
Tom Pierce (20:00):
So, there's clearly concerns, but there's the opportunity for credit unions to step in an offer their flavor of a BNPL program with some type of installment payments approach. So, similar to what you see with some of the larger credit card companies offering that, do you want to break this transaction into multiple payments?
Tom Pierce (20:21):
It's still a part of that base credit card experience, but it's giving more choice to your members as they're paying.
Tom Pierce (20:21):
So, if education around buy now, pay later is critical for credit unions to step up, that's always been an area that credit unions have led with their members as being strong educators. And this topic of buy now, pay later is very important to educate on so that members don't get further into debt that they can't handle.
Jim Marous (20:49):
It's an interesting dynamic because there's a lot of financial institutions that now, are looking at some of the FinTechs and saying, "Well, see, we told you so. It's not that easy." And that's probably a fair assessment.
Jim Marous (21:01):
On the other hand, to simply ignore that payment option is full hearty as well. And what happens is that's where you have to take legacy thinking and put to the test.
Jim Marous (21:13):
Because just because you have a loss, it does not mean in many cases that's the same level loss. You're not talking about tens of thousands of dollars with most buy now, pay later plans. This is something that are lower dollar value, quick turn items that while you may end up with more losses percentage, the dollar losses may not be that great.
Jim Marous (21:37):
And you really have to rethink the way you've looked at credit in the past and the opportunity to expand your customer base, your member base. So, it's going to be interesting to look at it because I think sometimes, we're naive or we're cynical about new payment options because we're born and bred in decades of history of legacy credit thinking. So, how important overall?
Tom Pierce (22:02):
That's why I think, Jim, when you look at particularly the younger consumers know that when they're at the point of sale, they've got ... potentially if the retailer's offering a buy now, pay later option through a Klarna or Affirm, they can make that choice.
Tom Pierce (22:19):
But it's more important if they know your credit union offers some type of installment payment option tied into your credit card, they're going to still choose to use your credit card to make the payment with ... if they don't have that option, they're going to make a choice of one of those FinTech firms that offers it.
Jim Marous (22:37):
It's interesting too — you work with a lot of financial institutions and different organizations run different ways, but many don't understand in many ways that the importance of transaction data and near real-time engagement to the overall success of a credit relationship.
Jim Marous (22:57):
What are you finding to be the biggest challenge with financial institutions actually using data to deploy better credit solutions, but also, to build the customer base and member base beyond where it is today from not only a member basis, but also from a transaction and outstanding basis?
Tom Pierce (23:21):
Well, we've actually found, and as we work with our credit unions an eagerness in approaching these opportunities. So, we do this Eye on Payment study on an annual basis, but we've began working back during the pandemic. We saw this demand from our credit unions because the world was shifting so quickly in terms of how people were transacting to having that real-time data so they could make decisions.
Tom Pierce (23:45):
So, we started producing originally, a weekly transaction insights reports during the pandemic for our credit unions, and then shifted post-pandemic into a monthly payments index, which provides real-time data for our credit unions to be able to see how are consumers shifting in their patterns of debit or credit card, actual transaction usage in different categories. Where might they need to incent them to use a credit card more or shift in their debit card strategy?
Tom Pierce (24:16):
Where are the rewards preferences at? Where are we maybe as we go now seeing an increase in delinquencies so that they can put more delinquency strategies in place. So, we've seen a higher demand.
Tom Pierce (24:27):
It's just having that access available, and we produce this monthly report for our credit unions, and then we offer them the chance to do comparative analysis where they can look at their actual transaction data versus the trends of the entire PSCU base of 900 plus credit unios we work with and see how they might be trending separately.
Tom Pierce (24:47):
But having that real-time data to make the decisioning of how you adjust your strategies to meet the needs of your members is critical. But rather than people having challenges, we're seeing people that really embrace it. They want that data, and they want it real-time so they can make some of those decisions.
Jim Marous (25:03):
It's interesting. I often talk about the fact that we love data to see how we're doing. It's deploying solutions against that data that the customer or member's going to feel. That makes the biggest difference.
Jim Marous (25:16):
When you work with your clients, with your member organizations, what's the biggest challenge you see in the marketplace with financial institutions in actually doing what your organization knows they should do?
Tom Pierce (25:34):
I think the biggest challenge we see, Jim, is prioritization. Often when we're working with credit unions beyond some of the largest ones, they're not the largest of shops. So, they've got folks that are wearing multiple hats within the organization.
Tom Pierce (25:48):
And so, having them prioritize the need to invest in a certain direction to support the payment side versus maybe how they're making investments from a fraud protection perspective or enhancing their branches, they have to make choices.
Tom Pierce (26:01):
So, while we try to guide them down the right pathway, they still have that internal challenge that they need to address of where do they put those finite resources at. You know, obviously, leveraging QSO like PSCU saves them some of that investment area, but they still have to make those choices for where they put the emphasis at. And that's probably the biggest challenge I think that they face.
Jim Marous (26:25):
It's interesting too because again, being a third party provider that really has the best interest of your clients in mind (not that most third party providers don't) but the reality is you have so much history, you have so much legacy thought pattern that allows you to basically guide financial institutions knowing what their challenges are, knowing what their opportunities are in the marketplace at a time of massive change.
Jim Marous (26:52):
And I'm going to double down on this as I do in most of my podcasts, the fact that now is the time more than ever to partner with organizations that understand what your challenges are, and they can take the ball on the financial institutions by half and run down the field and help you do better.
Jim Marous (27:10):
We sometimes say we don't have time, but the reality is right now, members and customers are requiring more than ever for their financial institutions to understand them and to reward them for their loyalty. And to do so, you really have to stay ahead of the game.
Jim Marous (27:30):
What are some of the takeaways from this year's study that credit unions can leverage to better serve their members?
Tom Pierce (27:39):
Yeah, let me talk about a couple of those, Jim. And I'll talk overall about the fact that if you think about the consumer, they're not just engaging in the financial services space. So, they have all of these digital experiences that are happening.
Tom Pierce (27:53):
Think about their Amazon experience. This is how they've been trained to engage with retailers and financial institutions are just another retailer out there when you're looking at that standpoint, we're selling financial services to consumers.
Tom Pierce (28:08):
So, when I look at the Amazon experience, they want this end-to-end experience within the Amazon platform. So, Amazon has brought other capabilities to the party within their experience to keep that consumer within that end-to-end solution that they offer. FIs, credit unions, and banks need to offer the same solution.
Tom Pierce (28:30):
So, that's why it's important to work with a QSO that can provide all of those capabilities for your members in the same way that you want to keep them within your environment.
Tom Pierce (28:41):
So, as we look at some of the fighting for this year and some of the takeaways, it’s going to be really important for credit unions to continue to keep a pulse on the economic impacts. This economic recession is not going away that quickly. So, it's going to be important to be able to pivot on your strategies and come out of this economic downturn in a strong fashion.
Tom Pierce (29:03):
Understanding where your members are at in terms of their economic experience, monitoring their delinquencies, promoting financial wellness and options for them is going to be very, very important. So, I think that's really the focus that we have from a takeaway perspective is offering choices, promoting financial wellness, being there to support your members in this time of economic challenges.
Jim Marous (29:28):
So, finally, as you look to the future, look at 2023 and even beyond Tom, and maybe getting outside of the Eye on Payments research that you've done — you have a pulse on the marketplace, you're out there all the time, you're working with clients. What are some of the major industry trends (mostly in payments) that you see that financial institutions, both credit unions and banks need to keep an eye on for over the next year or so?
Tom Pierce (29:59):
Yeah, so looking at the payments perspective, we think that while consumers are saying that they're using debit more, we're actually seeing the shift toward credit, and the growth in delinquencies. So, that's going to be a very important area for credit unions to focus for 2023 into 2024, is will they have to reign in some of those credit limits for their members so that they don't get too far from a delinquency perspective. That's one key factor.
Tom Pierce (30:32):
Monitoring fraud. The fraudsters are always shifting their direction. Before we were dealing with them all at the gas pump. And now, that they're beyond that, they're into are we impacting that digital experience? So, providing education for your members and also putting the right fraud protection in place is going to be a key strategy going forward.
Tom Pierce (30:55):
And then the other piece, kind of re-circling back to what I talked about before is now is the time to keep investing. The consumer demands, they're very fickle right now. They will shift financial institutions in a heartbeat if they can be served with the digital capabilities that they want for their financial experiences. They're not as loyal as they used to be.
Tom Pierce (31:22):
We've seen the continual erosion in that space where credit unions always had the loyal members because they would greet them in their branches, they knew them by name, while now most of those transactions are happening in a digital format now.
Tom Pierce (31:34):
So, they're competing against the likes of the big banks as well as the digital banking providers out there that have all of those fun and engaging digital capabilities that they want for their transaction experience. Credit unions need to be investing in these capabilities, or they're going to lose their members. That's a big focus they're going to have to take going forward.
Jim Marous (31:53):
It's interesting, Tom, because most institutions aren't feeling that they're losing their members because they're not closing their accounts. The reality is the diversification of financial relationships across multiple providers, you don't have to lose an account to lose a relationship, is what I usually say.
Jim Marous (32:12):
And especially the younger consumer who no longer sees the checking account as a primary service. That's another thing that takes a rethinking of the whole banking as we knew it, where most consumers may not make the PFI be in the checking account. It may be a credit card, it may be a loan relationship. There may be multiple PFIs based on what their needs are.
Tom Pierce (32:39):
Or digital capability. I've got daughters in that Gen Z, Gen Y space, and they do Venmo as much as they do a credit card transaction.
Jim Marous (32:47):
I was just going to say, my son probably, if you asked him to think deep about where is his most active financial relationship, it's Venmo without a doubt. They use that more than anything else, or in some ways, Uber. They're doing everything in an auto transfer between Amazon and Uber.
Tom Pierce (33:07):
Yeah, that's where they're focusing at.
Jim Marous (33:08):
Tom, thank you so much for being on the show today. Before we get off the podcast, can you tell people how to get your Eye on Payment study?
Tom Pierce (33:16):
Sure. Thank you, Jim. So, they can go onto our core website, pscu.com, and you'll find a link right at the top of that main page on there to be able to download the study. We've got a lot of details in there. We encourage you to pull on it, and we produce this on an annual basis. So, we'll look forward to having the conversation next year too.
Jim Marous (33:33):
Great research study. Really enjoyed digging into it, and thank you very much for being on the show.
Tom Pierce (33:37):
Thanks, Jim, really enjoyed it.
Jim Marous (33:41):
Thanks for listening to Banking Transformed, the winner of three international awards for podcast excellence. If you enjoyed today's interview, please give our show a five-star rating on your favorite podcast app. Also, be sure to catch my recent articles on The Financial Brand, and the research we're doing for the Digital Bank report.
Jim Marous (33:58):
This been a production of Evergreen Podcasts. A special thank you to our senior producer, Leah Haslage, audio engineer, Sean Rule-Hoffman, and video producer, Will Pritts. I'm your host, Jim Marous.
Jim Marous (34:11):
Until next time, remember, that as the economy changes, the consumer's payment preferences are also changing. So, be prepared.