As with any new technology, it all comes down to the execution.
The Payments GonzoBankers have just returned from the PSCU member forum and the biggest announcement (among many) was the launch of Lumin Digital, a new digital banking platform that is currently available only to credit unions.
A key item to understand is that while Lumin is a PSCU company, it isn’t necessary to be a PSCU client to utilize the product. We hope banks will take notice and push their digital vendors to develop something similar for their cardholder experience.
The new platform is built for the cloud with single page technology responsive design for online and mobile usage. The platform is said to provide an integrated digital experience that connects card processing, bill payment, core data and more into a “seamless and integrated solution.” PSCU is touting the solution as truly member first, not digital first.
This small but mighty company includes key players from the industry with experience in building digital systems. We thought it would be fun to play good cop/bad cop with our reaction to the announcement.
What could go right:
This is a game changer in terms of digital options for credit unions because of the inherent integration to the card processor that is available without API. The cloud-first architecture and responsive design are unlike anything credit unions have available today and should provide a competitive value prop when compared to other market digital solutions.
What could go wrong:
The new platform, while better than most third-party providers in the market, is very similar to existing big bank platforms. Given the timing for full launch (2019), we worry that by the time the product is in full production, the big banks will have moved on to the next level and will be further expanding their digital advantage.
What could go right:
Because the platform will be made available first to credit unions, Lumin will be focused on integration to key CU core platforms (Symitar is first) with hopes to be in beta by the end of the year. The ability to integrate the PSCU tools and systems into this digital platform may well provide the seamless experience that credit unions have been looking for since the launch of online banking. To achieve this type of integration today, credit unions are faced with utilizing APIs. This is a great option for credit unions staffed to fully utilize API data, but most CUs use the bare minimum to make it work. With Lumin, all of this could and should change, especially for PSCU processed clients.
What could go wrong:
Integration of disparate systems is the holy grail of any online/digital platform. This is normally accomplished with APIs, provided they are available and there is an IT staff to implement. The challenge PSCU will face is the integration timing and requirements of other necessary third parties such as core systems. Whatever the system, the timing, and complexity of integrating can be problematic.
Also concerning is the integration of credit unions not processing with PSCU. As mentioned earlier, the key to a seamless digital experience is the integration into the primary systems and functionality. If a credit union isn’t processing with PSCU, does the digital experience really offer all the tools necessary to be a viable solution for those clients?
What could go right:
The ability to leverage data will allow for targeted and personalized messaging in a white space that many other platforms waste on banner ads. Imagine being able to update a member on the status of a chargeback or fraud case? This will enable credit unions to create member-level interactions that allow for the customization required in the new mobile-first world. This point alone is what makes the potential of this new entrant to the digital market so intriguing! Another key component of the integration is that it will allow for a credit union to create and manage a member engagement score to assess the value of individual members. A true member-first solution.
What could go wrong:
As with any other data, the key to success with member score will be in the execution. If this just becomes another data element that is not utilized by credit unions, the impact will be minimal. Access to data is no longer the challenge, it is effectively leveraging data.
If executed as planned, this digital solution could truly be a game changer for PSCU, its clients, and the credit union market. This is the closest UI/UX experience to the big banks we have seen. The cloud-first architecture and responsive design are truly exceptional. The integration opportunity with existing systems is unlike any other processor, and member engagement scoring is big data leverage at its finest.
For most credit unions, this will be light years ahead of providers that either owns the experience and not the data or own both but never truly took advantage of integrating them effectively. We are cautiously optimistic that PSCU has the right game plan, and the roadmap looks like a differentiator in the market.
As with any roadmap, technology or product, it will all come down to execution. This could be the smartphone moment for PSCU and its clients. If PSCU doesn’t execute on this, it will be another flip phone. For the benefit of our clients, we are pulling for the smartphone!