Heading into our Digital Banking Transformation Summit, we were excited to talk with our industry experts about the role community banking has played during the pandemic. It’s been remarkable to see how, across the US, local financial institutions took the challenges of COVID-19 head on and were able to support their communities through quick action distributing PPP loans and small business support.
At the Summit we were lucky to speak with two inspiring digital banking leaders, Jill Castilla from Citizens Bank of Edmond and Michelle Spellerberg from Alliant Credit Union. Both prioritized the needs of their communities during the pandemic and were able to drive digital transformation and help their customers and members successfully navigate obstacles.
In our sessions with these leaders, we heard a common message: improving digital experiences and strengthening relationships with members & customers is crucial to paving the way forward.
The community banks and credit unions who supported small businesses and helped their communities navigate the pandemic are now able to invest in better digital experiences and become the primary financial institution for more people. And to their benefit, the technology to support their needs is much more accessible and scalable with the growth of Fintech.
"Now we can compete because prices have become more accessible. There's greater competition in the Fintech space, so you're able to really make these very sophisticated products and make things simpler for the customer. It's now available to us as community banks where it wasn't five years ago." -Jill Castilla
With the well-deserved attention community banks and credit unions are receiving, there’s a growing optimism for the role they’ll have rebuilding post-COVID. As Jill Castilla shared with us, “I’m starting to see so many more of my peers have that tipping point – seeing that it's acceptable now to make those investments, to lean forward into more digital technology, and to make things easier and a better experience for the customer.”
Even with the rise in optimism for community banking, we regularly hear from leaders that they’re uncertain where they should make their investments – and what the return on those investments will be.
Here are the top 5 strategies every Community Financial Institution should include in their digital planning:
The need to stay competitive with digital-native challenger and mega-banks didn’t originate with the pandemic. But with the massive shifts in user expectations around digital functionality, there’s greater urgency for community banks and credit unions to differentiate. The key is embracing community banking's biggest strength: the ability to build strong relationships with communities.
For Jill Castilla, community banking means providing a direct line of communication to her customers – oftentimes giving out her cell number and encouraging people to call or text whenever they have a question or feedback. Building a relationship with customers where they feel they actually have a voice at their bank is a crucial way Citizens Bank of Edmond is differentiating and supporting their community.
Since many community financial institutions are more agile than big banks, they’re able to quickly change and cater products and services to support the needs of their communities. At Alliant Credit Union, Michelle Spellerberg points to feedback received from members for much of their success: “We focus on being savvy and selfless, as well as socially responsible, and then really being hypersensitive to member feedback and taking action on that feedback.”
Choosing the right vendors for all your digital banking services is a difficult and potentially risky process. Of the many factors that go into the selection process, both our experts gave this important advice: work with partners who encourage you to innovate, and who are positioned to evolve & adapt with you.
As Jill Castilla points out, since many community financial institutions are agile and able to get impactful feedback from their customers and members, finding vendors who align with the needs of a community is crucial. Vendors who can eliminate roadblocks to minimally viable digital products are helpful in encouraging innovation at the community-level. And from the perspective of a leader like Jill, selecting vendors who are open and receptive to making changes based on feedback is a healthy way to innovate.
“On the community banker side, you want to be delightful to work with, but you also want to be a little challenging, and have the rigor, and kind of push each other too. Those are my favorite vendor relationships – when we just love each other, but we're also pushing each other through the process.” -Jill Castilla
Any community financial institution’s ability to grow and evolve post-Covid is largely dependent on their ability to attract and retain top talent. With increased competition for skilled employees, community financial institutions must also appeal to job seekers who place a greater importance on working for companies that align with their personal values.
For Michelle Spellerberg and the Alliant CU team, investing in social impact issues allows them to both address expectations from their community and positively benefit their members, “I think financial institutions have the opportunity today to really take on a cause – to take a stand overall. And I think if you can rally your partners, you can make an impact.” This thought-process has led Alliant CU to develop digital inclusion campaigns aimed at helping increase access to technology and high-speed internet for rural communities. As Spellerberg noted, “at the end of the day, digital inclusion leads to financial inclusion.”
“At the end of the day, digital inclusion leads to financial inclusion.” - Michelle Spellerberg
This was a point echoed by Jill Castilla who reflected a bit on the challenges she’s helped Citizens Bank of Edmond overcome with culture. The key takeaway Jill shared is to surround yourself with experts and lean into their talent, “When you're in a critical phase of your business life, you need experts around the table. Otherwise it can start falling on one person, or you can make novice mistakes.”
Many leadership teams at financial institutions across the US are focused on accomplishing one big goal: driving revenue growth. But as both our community banking panelists pointed out during the Digital Banking Transformation Summit, prioritizing the needs of a community is oftentimes more rewarding in the long term – both in terms of community health and revenue growth.
At Citizens Bank of Edmond, Jill Castilla and team do everything they can to avoid the trap of thinking they must grow bigger in order to survive. Instead, goals around sustainability and service have allowed them to introduce and test programs that increase the role a customer’s bank plays in their daily life. One such program is a co-working space where Citizens Bank of Edmond business clients can network with other small business owners, and even record their own podcast.
“As a smaller community bank, we are given so much grace from our customers to be able to try something and say, “We're putting this out here as a minimally viable product. We’d like to get your feedback, and let us know how we can do better.” And then [customers] work with us to make something beautiful happen.” - Jill Castilla
The importance of looking outside of the banking industry to find new and creative approaches to challenges was a topic that came up a few times throughout our virtual summit. And when you consider how much digital behavior has changed as a result of the pandemic, it’s prudent for any leader to seek inspiration from other industries.
Searching for creative ways to improve the experience of Citizens Bank of Edmond customers, Jill Castilla told us how she’s often inspired by the hospitality, airline, and restaurant industries, “I love that I can have a consistency of experience, and that there's a high regard for the consumer.”
One example of how she and the Citizens team put inspiration into action came in the form of fresh-baked chocolate chip cookies – giving customers the feeling of being at-home and warm while they’re in the branch.