How Alliant Credit Union grew deposits by $500 million in 2023

Omnichannel has become a bit of a buzzword across the financial services industry over the last few years, as the COVID-19 pandemic accelerated the shift to digital and the need to de-silo antiquated processes. But as the concept's impact on account opening procedures expands into the world of deposits, executives are starting to pay closer attention.

For Sumeet Grover, chief digital and marketing officer for Alliant Credit Union in Chicago, cutting through the hype and deploying account-opening and deposit-switching tools has led to sizable growth.

"Our key driver was first contact resolution," said Grover. "It doesn't matter if you're interacting with us digitally or over the phone, we want to ensure you have the best possible experience and your first contact with us results in what you're looking for. When you're operating under a branchless model, our need for omnichannel solutions was paramount because there's no in-person element for consumers to rely on."

Consumers have plenty of choices when it comes to selecting a primary institution to bank with. Fintechs that offer traditional products like checking and savings accounts have worked to boost the flow of incoming applications by building out more enticing services involving cryptocurrencies and streamlining the steps necessary to join.

Credit unions

Digital-only Alliant Credit Union overhauls account-opening

January 6, 2023 1:27 PM

In late 2022, the $18.5 billion-asset credit union debuted its partnership with the New York-based account opening fintech MANTL to help develop and deploy the firm's MANTL for Credit Unions system. The software works in tandem with the digital-only credit union's core tech stack and uses machine learning to analyze and vet applicant eligibility, while also streamlining the account funding process through an integration with Plaid and ensuring that submission progress is saved across each consumer-facing channel.

Employees within the credit union's call center have access to a real-time dashboard of applications in process, where representatives can guide prospective members through the onboarding stages and assist with mandatory account funding through a secure "hand off" feature. This aspect allows the employee and consumer to pass information back and forth while protecting the confidentiality of the credentials.

With the newly-added deposit origination platform, the credit union saw a 22% growth in core members — those seeking to join Alliant directly as opposed to through third-party partnerships — as well as a more than a $500 million jump in deposits for the first six months of 2023. Part of the growth was due to the launch of new short-term share certificates for three and six-month periods, which amounted to more than $100 million of the overall $500 million boost.

Grover said these new products, in conjunction with the new platform, enticed members to sequentially roll their deposits into longer but often higher-rate certificates offered by Alliant, a practice known as "laddering."

"We worked with MANTL to quickly and efficiently launch these new products and services, which allowed us to continue building trust with our members by providing a safe place to store their deposits," Grover said.

The trend of streamlining the process of onboarding new consumers has grown alongside the proliferation of omnichannel tools across the banking ecosystem. 

Cornerstone Advisors surveyed roughly 359 bank and credit union professionals across the asset and employment spectrum as part of its annual "What's Going on in Banking" report. Topping the list of new system selections and replacements was consumer digital account opening, with more than 46% of bank respondents and 48% of credit union respondents either adopting online account opening or planning to do so this year.

Previous examples of similar campaigns include State Street Global Advisors' efforts for hastening client onboarding and Bank of America's Merrill Lynch, which debuted its Collaborative Onboarding Experience in the spring of 2020 and boasts that roughly 60% of eligible accounts are opened digitally.

Leaders with Alkami, a digital service platform firm in Plano, Texas, that also offers automated account opening products, explained that de-siloing operations is tantamount to adopting more modern solutions and ensuring that investments can scale over time.

"As digitization continues to happen, I think the benefit to financial institutions is that they give consumers what they want," in a flexible manner that meets them where they prefer to do business, said Deep Varma, chief technology officer for Alkami. "The longer you take to bridge that gap, the greater the challenge of trying to solve this problem by implementing more custom solutions."

Direct deposit switching, which is often a component of onboarding, is also seeing a moment in the spotlight with recent innovations by Citizens Financial Group in Providence, Rhode Island, and Backbase, the Amsterdam-based provider of customer-facing software for banks. Both are working to streamline the necessary steps to move funds between institutions.

But for leaders of banks and credit unions that made prior improvements within consumer-facing channels, many wonder if the cost of a new platform is truly worth it.

Dylan Lerner, a senior digital banking analyst at Javelin Strategy, explained that while omnichannel does offer benefits when it comes to increased communication between marketing verticals and other operational improvements, there are other ways to improve account opening.

"When we talk about paying for [omnichannel tools] and having money in the budget to do it, there's this question of what would it cost to instead" add a contact number for help during the application process or "integrate all the educational articles you probably already have about account opening into the process," Lerner said.

The cost-analysis question will remain on the minds of wary leaders across the financial services industry as the pace of innovation continues to quicken.

"Part of the problem with living in the status quo, is there's so much competition, whether it's from the money center banks who spend billions of dollars in technology, the fintechs who ostensibly are just building a better user experience or even community institutions," said Nathaniel Harley, cofounder and chief executive of MANTL.