Catalyst News

James Robert Lay: Pandemic Digital Transformation Was ‘Just a Warmup’

by Catalyst Corporate | Jul 02, 2021
James Robert Lay

You think digital transformation was rapid during the COVID-19 pandemic? That was just a warmup for the future, according to James Robert Lay, a digital marketing strategist slated to present insights on the “Rise of Self-Service Banking” at Catalyst Corporate’s 2021 Economic & Payments Forum Sept. 20-22.

“Credit unions should get comfortable feeling uncomfortable,” Lay said in a recent interview with Catalyst Corporate, referring to the speed at which mass adoption of new technology takes place today. Lay, CEO of Houston-based Digital Growth Institute, acknowledged the role the pandemic has played in accelerating acceptance of certain technologies, including interactive teller machines (ITMs).

“COVID-19 spurred an increase in digital adoption, as well as in remote capabilities,” Lay said. “Early in the pandemic, consumers had concerns over cash withdrawals. As the pandemic wore on, however, we saw growing adoption of video terminal usage at ITMs. This paralleled a greater comfort level with other types of video communication made commonplace during the pandemic, such as Zoom, FaceTime and Teams.”

For credit unions that contend their members would rather deal with human beings than interact with machines, Lay said this: “Self-service is not the same as self-selling. The human connection is still critically important. An ITM is the beautiful bridge between the two. It allows consumers to take care of those tasks they don’t want or need help with and gives them the opportunity to speak with a live person when they need assistance.”

The evolution will continue, Lay said. “How we pay for things is flipping the industry on its head. Bitcoin ATMs are already on the market, and just this month, a major mid-Atlantic convenience chain announced a partnership with NCR that will enable customers to purchase convenience items and fuel with digital currencies.”

But how does a credit union balance consumers’ seemingly insatiable demand for technology with safety/security and the realities of a fixed budget?

“When financial institutions say, ‘We don’t have the budget for this, we can’t afford it,’ I hear, ‘It’s not that important to us,’’ Lay said. “That thinking creates a feedback loop that can limit future growth potential. Budgeting for technology is a choice.”

“Consumers should drive your decision making. We won’t be around long otherwise.” And although credit unions cannot always predict exactly which technology will dominate in the future, Lay says, “It’s like watching the path of a hurricane. You can develop solutions for a variety of potential scenarios. If it zigs, you’ll do this; if it zags, you’ll do that.”

Lay urged credit unions to ensure they are taking full advantage of the technology they already have. For example, if a consumer is deciding on a checking account and the credit union hasn’t made it clear it is part of a nationwide surcharge-free ATM network, it is missing the boat, he said.

“One of the biggest financial services pain points for consumers is fees, and ATM fees are the largest source of fees behind overdraft fees. Don’t let your credit union’s lack of fees be ‘your best kept secret.’”

Position your products for success, Lay advised. “The Chime banking model is successful because of product positioning, Rocket Mortgage is winning because of product positioning, not necessarily because either has a unique or superior product.”

James Robert Lay, whose first exposure to credit unions was developing a website for JSC Federal Credit Union as a college student, is the author of “Banking on Digital Growth.” Come hear more of Lay’s digital strategy at his bonus session for onsite Economic & Payments Forum attendees, “The Rise of Self-Service Banking” on Wednesday, Sept. 22 at 10:15 a.m. Register today (no cancellation fees through September 8).