Credit Unions

Tech costs should not be killing innovation for small credit unions

Denise Wymore
September 6, 2023

To remain relevant in today’s financial landscape, small credit unions must equip themselves with the latest digital features and capabilities. Unfortunately, smaller credit unions often find themselves at a disadvantage due to their limited capacity to invest in and support high-quality technology, unlike their larger counterparts.

In the second quarter of 2023 NCUA reported that of the 36 credit unions that merged, 24 credit unions with less than $100M in assets were merging for expanded services. In an industry where the principle of economies of scale is alive and well, it’s difficult for small credit unions to meet the price tag of the tech that will make them competitive. Partnering with the right tech partner can greatly impact the bottom line. 

The distinct advantage of credit unions over large commercial banks lies in the positive impact their financial resources can have on their community. There’s no investment more valuable than one in technology that empowers your credit union to extend loans to a broader membership base, thereby increasing your ability to make a meaningful difference in your community through fair and equitable lending practices. 

Getting to the core

Many small credit unions might feel like they are being held hostage by their core processor. That’s why it’s important to look for a tech partner who is core agnostic and can find ways to work within your current systems and processes in harmony.

They are out there! When assessing new technologies it’s important to understand the project management time and resources it’s going to take, especially if your credit union, like so many other smaller ones, does not have a dedicated IT team. Look for vendors that understand your constraints and can offer bigger support. For example, some credit unions can implement Zest AI technology in as little as four weeks with no IT lift. 

Time is money

Manual underwriting processes are notorious for being inefficient and time-consuming. Shockingly, 83 percent of credit unions take more than 30 minutes to provide a decision*. In our fast-paced world, where consumers demand immediate responses, this delay often causes members to simply look elsewhere. 

When you partner with a technology provider that can automate manual processes, your staff will have time to work on other projects that might otherwise be ignored. The goal is never to eliminate staff, it is to position employees where they can make decisions and provide the services that computers and bots cannot. 

Speaking of money…

Where there is a will, there is a way... and several programs available for small credit unions to get technical assistance in the form of grants. The NCUA has the Community Development Revolving Loan Fund (CDRLF) annual grant program aimed at Low Income Designated (LID) and Minority Deposit Institutions (MDI). 

In 1994, the US Department of the Treasury created the Community Development Financial Institution (CDFI) Fund. The CDFI Program offers both Financial Assistance and Technical Assistance awards to CDFIs. These competitive awards support and enhance the ability of these organizations to meet the needs of the communities they serve.

is a certified CDFI intermediary that provides capital, makes connections, builds capacity, develops innovative products and services, and advocates for their member community development credit unions (CDCUs). 

Small credit unions are a vital part of the credit union movement. Millions of consumers depend on small credit unions for their tailored products and services. At Zest AI, we are dedicated to ensuring that even small credit unions have access to top-tier lending tools mirroring the capabilities of their larger counterparts, and take immense pride in making this commitment a reality.

*Source: Zest NACUSO Survey


Denise Wymore is an inductee to America’s Credit Union Museum and a cheerleader for passion and commitment. Currently, she is the Marketing Manager for Small Credit Union Initiatives at Zest AI and is proud to be a credit union lifer who started her career as a teller. 

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