The financial services industry has a love-hate relationshipwith social media. They like how accountholders cancommunicate directly with financial institutions but fear howstartups use it to threaten traditional relationships.

Almost two-thirds of American adults use social networking sitesper the Pew Research Center. Plus, there are almost 1.9 billionactive Facebook users and five billion views YouTube daily.Worrisome for financial institutions is an Accenture survey thatrevealed nearly one-third of its respondents would switch toGoogle, Amazon or Facebook for banking, if they could.

However, disintermediation presents a greater threat, accordingto Larry Pruss, SVP Memphis, Tenn.-based Strategic ResourceManagement, which helps credit unions maximize bottom-lineperformance.

Pruss explained a credit union core function is serving asintermediary for borrowers and lenders. However, social mediaplatforms get in between, which could hurt revenue streams, brand,and data.

Some nontraditional providers also serve unique verticals andsegments previously underserved by traditional financial services,Pruss maintained.

So how are credit unions adapting to social media?

John F. Kilduff, corporate affairs officer at $545 millionChambersburg, Penn.-based Patriot Federal Credit Union, a client of Fiserv, andRaddon, a Fiserv company, for research and analytics, said,discussed the importance of engaging members who are increasinglyactive on social media. This led to Patriot's launch of a socialmedia initiative last fall.

Kilduff asserted, “You can't simply ignore social media and havethe mindset that if we don't have a Facebook page or a Twitterchannel that your credit union is not in social media. It is,whether you like it or not. You have to address it, manage it, andmake it work for you. “

Another Fiserv core client, the $1.04 billion St. Paul,Minn.-based Hiway Federal Credit Union also engages membersthrough social media.

“Social media is the quickest and most accessible way to engagewith a company, which is why we felt the need and desire to be apart of this space,” Deb Cariveau-Rogers, marketing manager atHiway said.

A new partnership between the New York Credit Union Associationand Monett, Mo.-based MEA Financial Enterprises, for example, willhelp New York's credit unions secure a two-way texting tool thatenhances member interaction.

Seattle-based CU Texting, a vendor sourcing consulting firm withtwo-way SMS core competency, works with credit unions seeking tobring their landline and toll-free number into the textingmedium.

Another groundbreaking technology is natural languageunderstanding. Montreal, Canada-based North Side developedVerbalAccess, which enables conversational access – through text ortyping or by speaking in plain English – to a financialinstitution's APIs.

“We extract the information needed to do a transaction or aquery. You don't click anymore, you don't type anymore, youconverse, you speak normally,” Eugene Joseph, CEO of North Side,explained.

Read more about the social media influence on credit unionsin the May 3, 2017 print issue of CU Times.