TechSolutions4CUs

Tired of casting a wide net and coming up empty? The secret to revitalizing your credit union might be to start thinking small.

In this episode, host John San Filippo sits down with Michael Duncan, CEO and founder of digital banking provider Bankjoy, to discuss the strategy of vertical banking (also known as niche banking or sub-branding). This approach allows community financial institutions to leverage their existing charter to create a discrete, digital brand that caters to a very specific audience.

You'll learn:

• The Power of Niche Focus: How ignoring 99% of the market can lead to massive growth by focusing on a specific, unmet need.
• Real-World Success Story: The case of Panacea Financial, a digital-only bank serving doctors and healthcare professionals, which achieved over half a billion dollars in assets in just a few years by solving the unique financial problems faced by young physicians.
• Potential Niches for CUs: Other segments credit unions can target, such as military service, teachers, and even specific demographics like women or younger generations (Gen Z).
• Overcoming Hurdles: Mike addresses the common concerns of staffing, marketing a digital-only brand, and the scary part—the technology.
• Technology Simplification: Discover how modern digital banking providers like Bankjoy make it possible for you to launch a new vertical brand in as little as six weeks to three months without having to replace your core system.

Mike's key takeaway for hesitant credit union CEOs? "Don't delay. It's not as big as you think." Start small, experiment, and see if this targeted, personalized approach is the solution to your growth challenges.

You're also invited to download Bankjoys white paper on the topic: How Vertical Banking DrivesGrowth for CommunityFinancial Institutions -Reach New Markets with Targeted, Niche Banking Experiences.

This episode of the TechSolutions4CUs podcast, hosted by Finopotamus Publisher John San Filippo, features Anna Khalzova and Slava Akulov, the co-founders of Jupid, discussing their white-labeled solution for credit unions looking to serve small business members.

 The Core Problem and Jupid’s Solution

 Jupid aims to close the gap between credit unions and small businesses, particularly new ventures, which often do not view a credit union as their primary financial institution at the company formation stage. The Jupid platform provides a crucial set of tools to help small business owners with compliance, tax filing, and accounting, allowing them to focus on their core business.

 The Member Experience

 For a small business member, the Jupid platform simplifies running a business, promising less stress.

• Formation and Compliance: The platform offers a simple, streamlined process for company formation, with support from the local credit union. It provides a structured timeline of compliance tasks for the year, sends reminders, and can even file documents like franchise taxes on the member's behalf, which can be approved through digital banking.
• AI Assistant: Jupid features an AI assistant, accessible through messengers like WhatsApp or iMessage. This assistant proactively categorizes transactions and can answer business questions on the go. It gains deep context from various sources, including bank accounts, emails, and web searches, to organize operational data, ensure compliance, and streamline financial preparation.
• Integration: Jupid integrates with existing tools like QuickBooks, automating manual tasks that business owners or accountants would otherwise have to do. The solution is also designed to be tightly integrated within the credit union's digital banking experience.

 Business Model and Credit Union Benefit

 Jupid's model is designed to be a "long-term gain" and a "sticky" relationship for the credit union.

• Revenue: The recommended model is a subscription service for accounting, tax filing, and compliance, priced at approximately $50 a month, which is a fraction of the average annual cost a small business spends on compliance. Credit unions receive a 20% revenue share from this subscription fee.
• Acquisition: Jupid offers the company formation service for free if the business owner signs up for a business account and the platform's tax/accounting services, which serves as a powerful acquisition tool. The credit union can also choose to refund the state formation fees as an added incentive.
• Target Market: The platform is an effective tool for credit unions to target their existing retail members who are already running a business through their personal accounts (estimated at around 25% of a credit union's member base).

 Implementation and Partnership

 Jupid is pre-integrated with digital banking platforms like Banno and Q2, with a target implementation time of about four weeks. The ideal credit union partner is one in the $1 to $10 billion asset range that is actively committed to growing its small business presence. Once fully implemented, the platform is designed to be highly self-sufficient, saving credit union staff time.

 AI and the Future

 The co-founders emphasize that Jupid's core technology is a proprietary AI system trained on tax laws. To ensure trust, all critical actions and filings are supervised by internal human accountants (CPAs). They predict that AI will become an expected, pervasive layer in every part of life, including banking, driving the need for personalized, faster, and cheaper services.

As part of our ongoing commitment at Finopotamus to cover the tech topics you won't see in other credit union outlets, we're pleased to offer a very important episode of TechSolutions4CUs on a very important topic: cloud repatriation. This episode features cloud repatriation experts Kevin Heisser and Ian Nock from ArcShift. Cloud repatriation is becoming an increasingly popular idea as organizations that moved all their operations to the cloud are now realizing there’s a strong argument for bringing some of their workload back on-premise.

The ArcShift co-founders explain that their company was founded to address what they see as a backward trend in the tech industry, where solutions are often driven by vendor incentives and sales quotas rather than customer needs. ArcShift’s mission is to put people back in control of their data and save them money. They emphasize that they are not suggesting organizations should pull everything out of the cloud, but rather advocating for a hybrid approach. This hybrid model allows organizations to keep some functions in the cloud, while moving certain workloads back on-premise for reasons such as cost savings, security, and performance.

One of the main reasons more organizations aren't pursuing cloud repatriation is the strong bias from tech vendors, who profit from the high profit margins and annual recurring revenue (ARR) of cloud services. Cloud companies also make it very easy to migrate data into the cloud with various tools, but make it very difficult to get data out. 

Another factor is that IT professionals may be overwhelmed and hesitant to move their production workloads for fear of downtime or other complications. ArcShift addresses this by providing a platform and toolset that make the repatriation process easy and seamless, including a TCO (total cost of ownership) tool to help organizations assess potential savings.

In addition to cost savings, other benefits of cloud repatriation include enhanced security and better support. In the cloud, hardware is often shared, and there is a risk of misconfigurations or vulnerabilities that can expose data. When a problem occurs, a company with a small infrastructure may not receive timely support from public cloud providers. AI workloads are particularly good candidates for repatriation due to their high cost in the cloud. The cost of running AI infrastructure in the cloud can be "enormously" expensive, and companies are finding that they can buy their own infrastructure for a fraction of the cost and have more control. ArcShift is vendor-agnostic, meaning they do not sell any hardware or software, so their recommendations are unbiased and focused solely on the customer's needs.

In this episode of TechSolutions4CUs, host John San Filippo welcomes marketing expert Alicia Disantis to discuss foundational marketing strategies for small organizations, including fintechs and credit unions, operating on a shoestring budget.

Alicia challenges the "Field of Dreams" mentality, where good products are expected to sell themselves. She emphasizes that in today's crowded market, consistent messaging and strategic outreach are crucial.

Key takeaways from their conversation include:

• Building Trust as a Core Principle: Alicia highlights recent data showing trust in an organization and its information as the number one buying factor, surpassing convenience and price.
• The Four Pillars of Marketing Success: She outlines four essential, low-cost strategies:
  1. Define Your Brand Voice: Understand and consistently project your brand's personality across all platforms to build credibility.
  2. Survey Your Audience: Utilize simple, open-ended surveys to gain insights into how customers perceive your brand, why they choose you, and where you can improve.
  3. Invest in a Quality Website: A professional and user-friendly website is non-negotiable for establishing credibility and avoiding distrust.
  4. Leverage Partnerships: Collaborate with trusted organizations to expand your reach and build credibility through association.
  
  
• The Intangible Value of Marketing: Both John and Alicia discuss the challenge of measuring marketing ROI, agreeing that not all impactful marketing efforts can be immediately quantified. They also touch upon the evolving landscape of PR, emphasizing the importance of relationships and consistent effort.
• Navigating Generational Differences: The conversation touches on how different generations interact with technology and financial services, from millennials' preference for digital interactions to Gen Z's reliance on social media and the growing use of "buy now, pay later" services.
• The Enduring Importance of Human Connection: Despite technological advancements, both agree that in-person interactions and reliable human support remain vital for building and maintaining customer trust, particularly during critical moments.

This episode offers actionable advice for small financial institutions looking to enhance their marketing efforts without breaking the bank.

On this episode of TechSolutions4CUs, we welcome Jason Cain, co-founder and CSO of ShiftMate, to discuss their innovative AI co-pilot for credit unions. Jason shares his unique perspective, born from decades of experience within credit unions and selling fintech solutions, on how ShiftMate addresses long-standing challenges by unifying data, AI, and workflow automation. 

We explore how this platform empowers frontline staff with actionable insights and provides senior management with institutional insights by analyzing aggregated data. Tune in to understand ShiftMate's flexible deployment, its potential to replace legacy systems, and Jason's predictions for the transformative impact of AI on the financial well-being of members and the industry as a whole.

In this episode of Tech Solutions for CUs, host John San Filippo interviews Ronny Chapman about his new company, VisionFI. Chapman explains that VisionFI is not a standalone product but a component that plugs into other solutions like loan origination systems (LOS) or new account opening platforms, and even Microsoft Office.

VisionFI's core function is to use multimodal AI to read images, photos, and documents, taking unstructured data and bringing structure to it. Chapman provides an example of its original use case: taking a picture of a car's VIN through the windshield to extract the VIN, eliminating manual input. The technology has since evolved to process various documents such as tax returns, operating agreements, and auto loan packages.

A significant use case in auto lending involves members bringing paperwork from a car dealer to the credit union. VisionFI can process this paperwork, like retail installment contracts and buyer's orders, by simply taking a photo, converting what would be a 30-minute manual entry process into an automated input for the LOS. This effectively turns a dealer-financed loan into a direct loan or refinance for the credit union.

Chapman also discusses how VisionFI can be used for loan quality checks, aiming for 100% accuracy rather than sample checks. He emphasizes that VisionFI doesn't add judgment or decisioning but reads information faster than a human, allowing employees to focus on higher-value tasks.

Regarding pricing, VisionFI charges per 1 million "tokens," which represent computational thought and are a measure of AI consumption. Chapman estimates that humans process around 500 tokens per minute, while VisionFI achieves about 26,000 tokens per minute. He suggests that a human's token processing can cost $300-$700 per million tokens, while VisionFI could be $50-$60 per million tokens, demonstrating a significant ROI.

Chapman shares an aspirational use case where VisionFI could allow members to simply send documents like tax returns, pay stubs, or W2s, and the system would automatically convert and input the data into an application, eliminating the need for manual keying and enhancing member service. He also predicts a future where personal consumer tools, like Apple iCloud or Google accounts, will be more integrated with financial services for seamless document sharing and online banking logins.

Credit union executives interested in learning more can contact Ronny Chapman at [email protected] or visit visionfi.ai. He welcomes discussions on potential use cases and opportunities to improve member experience.

On this episode of TechSolutions4CUs, Alex McLeod, CEO of Parlay Finance, discusses how credit unions can enhance their small business lending through Parlay's loan intelligence system. According to McLeod, more and more credit unions are recognizing the opportunities in serving small businesses, and lending is a critical component.

Parlay Finance offers a front-end intake system, which they call a loan intelligence system (LIS), designed to help credit unions approve more small business loans faster. The system features a small business portal where members can submit inquiries. Using AI, the LIS processes inquiries in 10 seconds or less, with a mission to help small businesses access capital and improve their readiness for loans, while also making the process more efficient for lenders. McLeod states that a small business can submit an inquiry in 15 minutes or less, and a lender can review it in 10 seconds or less. This significantly cuts down on manual work, enabling credit unions to better assist members seeking affordable products to grow their businesses.

McLeod explains that Parlay's LIS is a unique solution addressing the difficulties in small business lending. Historically, lenders have relied on loan origination systems (LOS), which often involve manual and static workflows not well-suited for the flexible needs of small businesses. The LIS acts as an "orchestration layer" that gathers information, identifies optimal product fits, and directs data to the appropriate systems of record, such as the LOS. This automation eliminates much of the initial triage work often done manually via email, phone, or even paper.

The LIS integrates with a credit union's existing tech stack, primarily the LOS, by seamlessly sending information via API. The system ingests core data blocks for every small business loan request, including information on the business owner, the business itself, and the intended use of funds. It also incorporates validation data such as financials and tax returns. Data enters the system through user contributions and user-permitted pulls, such as credit scores (FICO, SBSS), Know Your Customer (KYC), Know Your Business (KYB) permissions, and tax forms. McLeod highlights that the LIS automates these data pulls, streamlining the process for both small businesses and lenders by reducing the need for manual data collection from multiple sources.

Credit unions often seek Parlay when they recognize an "intake problem"—the inability to provide small businesses with quick, digital answers regarding loan qualifications. McLeod emphasizes that small businesses now expect instant online applications or immediate qualification answers, a standard set by online lenders. Implementing an LIS allows credit unions to meet these expectations, offering a faster and easier experience than traditional manual processes. For credit union employees, an LIS transforms their work from hours of manual follow-ups to quickly reviewing processed inquiries, saving time and enabling them to focus on relationship building and providing guidance.

McLeod notes that Parlay typically serves credit unions in the $1 billion to $6 billion asset range, but can support both larger and smaller institutions. The decision to adopt such a system often depends on whether small business lending is a high priority for the credit union's growth strategy. McLeod believes that within the next two years, the challenge of quantifying small business creditworthiness will be "radically changing" due to advancements in AI, which can handle the vast and varied data points involved.

What started out as a simple interview for a written article ended up becoming a great TechSolutions4CUs episode.

Podcast host John San Filippo recently sat down (virtually, of course!) with the ever-insightful Lee Wetherington, Senior Director of Corporate Strategy at Jack Henry. They were chatting about Jack Henry's brand new "2025 Strategy Benchmark" research, which, as you might guess, polls bank and credit union CEOs on their big priorities. Lee kicked things off by saying the top-line takeaway for everyone rolling into 2025 is a fierce focus on boosting operational efficiency. Apparently, 2024 was a bit rough with downward pressure on net income due to rising costs (think staff, talent, and loan loss provisions), so everyone's looking to tighten things up.

Naturally, this conversation quickly veered into how tech like artificial intelligence (AI), machine learning, and even newer "agentic models" (more on that later!) can help. But Lee, being a pragmatist, pointed out a major "blind spot": Many institutions might not have the data infrastructure ready to actually leverage these cool tools for efficiency gains. He also touched on other big priorities: Banks are all about growing deposits, while credit unions are doubling down on growing loans and, no surprise here, attracting younger members. Lee made a strong case that all paths to growthlead through Gen Z.

Here are some of the top takeaways from their discussion:

• Efficiency is King, But Data is the Kingdom: The top priority across the board is improving operational efficiency. AI and automation are seen as key enablers, but their effectiveness hinges on having clean, accessible, and comprehensive data – a major hurdle many still face.
• All Roads Lead to Gen Z: Whether it's growing deposits or acquiring new members, understanding and attracting Gen Z is paramount. This means seamless mobile account opening (under three minutes!), divorcing account opening from immediate funding, and recognizing Gen Z's unique expectations.
• The "War" for Data: Ask First, Ask Best: With data  so fragmented, Lee emphasized that there's a "war," not just a race, for financial institutions to become the primary data aggregator for their accountholders. This means proactively asking members for permission to consolidate their financial data (with clear benefits like better fraud detection and personalized advice) before competitors do.
• Branches Aren't Dead, They're Evolving: Despite the digital focus, physical branches still matter, even to Gen Z. Younger generations want the option of in-person help for complex issues or advice, making it a "both/and" scenario rather than an "either/or" with digital channels.
• Agentic AI and the Mind-Blowing Future: Lee got pretty jazzed about "agentic AI" – essentially AI models that can not only analyze but also act on information and coordinate with other models. He also touched on the rapidly expanding "context windows" of AI, predicting that within three years, institutions will be able to feed all their data into a model, leading to "speech-to-action" or "text-to-action" capabilities where you can simply tell the AI what you need, and it gets done.

Lee wrapped up by stressing that amidst all the regulatory upheaval and economic uncertainty, financial institutions need to stick to first principles. That means truly knowing your member, which requires data. He urged credit unions to leverage the trust they've built to "ask first and best" for permission to aggregate member data, because you can't be a "fast follower" in the AI game if you don't have the data fuel. 

In this  episode of TechSolutions4CUs, host John San Filippo talks with Chris Cox from Apiture to explore the evolving landscape of digital banking for credit unions.

Chris delves into Apiture's five primary solution sets:

1. Consumer banking services
2. Business banking services
3. Digital account opening,
4. Data intelligence
5. API banking

He emphasizes the increasing importance of a credit union's digital banking platform, suggesting it's now as critical as the core platform itself. The conversation highlights how digital channels are the most significant touchpoint for members today.

A key focus of the discussion is the strategic advantage of integrating digital account opening with the overall digital banking platform. Chris explains how this creates a seamless experience for new members, allowing them to establish credentials for all services from the outset and providing valuable data for tracking marketing effectiveness.

The episode also sheds light on the nuances of business banking, an area where Apiture has a long-standing presence. Chris points out the distinct needs of business members, such as complex payment options (ACH, wires) and sophisticated entitlement structures for employees, which differ significantly from consumer banking. He notes the growing trend of credit unions focusing more on serving businesses, recognizing the opportunity for new loan types and member growth, and solidifying their role as community anchors. The discussion also touches on identifying business accounts that might be currently operating under consumer account profiles.

Looking ahead, Chris discusses the transformative potential of artificial intelligence (AI) in digital banking. He outlines two dimensions: leveraging AI to improve software development processes internally and incorporating AI into client-facing solutions. Examples include a "data explorer" capability allowing natural language queries of data and the future possibility of highly personalized banking experiences and even "prompt-based banking," where members interact with their finances through simple language commands.

Ultimately, Chris envisions a future where credit unions can offer "super personalized experiences" to individual members, leveraging data and AI to truly understand and cater to their financial needs, thereby strengthening their unique position in the market. He concludes by expressing his excitement about the capabilities Apiture has built to support the business of credit unions.

In this episode, Paul Provenzano, VP of Market Development at ebankIT, discusses the significant opportunity for credit unions in the Small and Medium-sized Business (SMB) digital banking sector. He notes that many SMBs are currently dissatisfied with their banking technology and are seeking better tools to manage their businesses, creating an opening for credit unions.

Key takeaways from the discussion include:

• Market Need: SMBs require more than just basic transaction capabilities; they need tools for invoicing, expense management, payroll, and cash flow analysis. Simply offering a retail digital banking platform is often insufficient and risky, as business needs differ significantly from consumer needs.
• ebankIT's Solution: ebankIT provides a comprehensive digital banking platform that supports various business lines, including consumer, small business, and corporate accounts. Their platform can be deployed specifically for business banking, even if a credit union retains a different provider for consumer accounts. A key feature is the ability to offer a single login for members to access both personal and multiple business accounts, improving user experience.
• Strategic Approach: Provenzano emphasizes a "platform" approach over a simple "service," advocating for flexible, open API systems that allow integration with various third-party fintechs catering to specific business needs (like onboarding or specialized payments). He stresses that technology should empower the credit union's business strategy, not limit it.
• Market Segmentation: Credit unions should segment the business market (e.g., by size, industry) and tailor digital offerings to the specific banking requirements of each segment.
• Revenue & Value: Business banking offers fee income opportunities, potentially through tiered or subscription-based models providing access to more advanced tools. The goal is to become the "digital front door" for a business's financial operations, increasing stickiness.
• Implementation: Successfully entering or expanding SMB banking requires not just technology but also a potential cultural shift and clear business strategy within the credit union.
• Future Trends: The future involves leveraging data for predictive analytics, such as cash flow forecasting, to provide deeper business insights directly within the digital banking platform.

Overall, the episode argues that with the right strategy and technology platform, credit unions are well-positioned to capture a larger share of the profitable SMB market by offering tailored, technologically advanced digital banking solutions.