Digital transformation is the word in the financial world.

How are we balancing the need for both digital and non digital facets within the lending process?

On this episode of Leaders in Lending, Nathaneal Tarwasokono, President & CEO at Firstmark Credit Union joins us to talk about how Firstmark is digitally transforming their own way and how disruption is altering the financial world as we know it.

Bricks and Clicks

Bricks and Clicks, a term coined by FirstMark Credit Union, is the balance between the necessary digital and human touch points of the new hybridized banking process.

Here’s how Tarwasokono is leading the way:

Transactional/Relational

Tarwasokono has found that most consumers begin their first engagements with their desired brand digitally.

With account opening and loan application easier than ever these days, he’s realized that online engagement is best for transactional interactions.

As the consumer ventures deeper into the technology and needs guidance with the more complicated aspects of the product, they typically seek consultation either over the phone with a representative or in-branch.

Tarwasokono describes the in-branch experience as relational and believes that every successful user experience should strike an equal balance between transactional and relational interactions.

So how does FirstMark ensure that balance?

Certified Financial Coaches

When customers call or come into the branch, they’re usually seeking advice.

It’s become integral to the FirstMark customer service process that their in-branch staff become certified financial coaches.

Coaches are there to help educate their customers, empowering them to make the right financial decisions by assisting with everything from budgeting to saving for retirement.

When it comes to making complicated, long term life decisions, consumers are finding the human touch experience invaluable.

However, consumers aren’t the only ones making use of the new opportunity.

FirstMark’s employees are enjoying the benefits of career advancement, moving from administrative rote work to higher value, consultative work and ultimately getting their customers more of what they need.

Consumer lending

Credit score and collateral has been the traditional way of proving whether or not a consumer should or should not be approved to borrow money consumer lending. Many financial institutions are finding that these methods are outdated and exclude a large portion of eligible borrowers.

Qualifications

The story, according to Tarwasokono, is what’s most important to understand when measuring the reliability of a prospective borrower.

Artificial intelligence is aiding that mission by collecting all the information needed to truly understand that story. 

For every situation where a consumer has a poor, but steadily improving credit score, there is a consumer with a good but steadily declining credit score. 

If you’re able to digitally uncover that information using AI and pull together those factors, you’ll be able to make far more informed decisions.

For many community-based organizations like FirstMark, building an AI of this power is not in the budget.

Finding the right partner, Tarwasokono says, one who’s moving down the same path, is the best way forward.

Product Selection

With the rise in Fintech partnerships, credit union products, in particular, are becoming more specialized.

Instead of focusing capital on supplying the consumer with everything, smaller institutions are leveraging their partnerships to provide a single or select group of niche yet powerful services.

Selective

In the modern age, consumers expect excellence.

Attempting to be everything for every consumer for small, community-based banks, spreads resources too thin.

However, if it’s played too small, the institution won’t be meeting the needs of the marketplace.

That’s why choosing one or two products to specialize in enables focused attention on the core features of the business while maintaining flexibility so that there’s no dependence on a sole product.

Buy Now Pay Later

As shopping grows increasingly digital, brands are making a point to supply financing options for their bigger investment purchases.

Now that financing is starting to move to a point of sale context, which usually comes in the form of the “buy now, pay later” option, consumers can start shopping before even thinking about financing.

Community Relations

The banking industry right now is being greatly disrupted and credit unions are well positioned to add value to their communities.

Tarwasokono urges these institutions to reflect on which partnerships and tools can they leverage to answer the ultimate question: How do we continue to give back to the community?