What fintechs and credit unions have learned from each other
- Fintech has had a major impact on credit unions.
- Could it be that credit unions are also influencing fintech?

Like all financial institutions, credit unions have had to adapt to changing technologies. From back-end to front-end, credit unions have made changes to meet growing customer expectations for better banking experiences.
For credit unions, this demand to become a sparkly digital thing of wonder does not come easily. Credit unions often don’t have the budgets needed to make considerable changes, and big bad core IT providers often make it difficult or impossible for smaller banks and credit unions under contract to access newer technologies.
Still, you’d be hard-pressed to find a credit union in the U.S. without an online or mobile app. Interestingly, as fintech continues to drive change in credit unions, some credit union practices are also finding their way into fintech companies.
Member-owned, not-for-profit credit unions function as the wellness gurus of the industry in a number of ways. For one, they have lower checking fees. A 2015 Bankrate survey found that 72 percent of credit unions offer free checking accounts, as opposed to just 38 percent of banks. What’s more, as Andrew Downin, CPA and managing director of the Filene Research Institute told Tradestreaming, credit unions’ philosophy has them constantly searching out new and better ways to help their members improve their financial behavior.
ChimpChange, a digital banking service provider, seems in many ways to be a digital credit union copycat. Launched in August 2015, the company set out to provide lower account fees with a free, or nearly free, basic bank account.
So far, the company is hitting its credit union-like fee goals. The account is free to open, there are no monthly fees, deposits into the account are free, and there is free real-time check deposit and P2P payments to other ChimpChange users. According to ChimpChange founder and CEO Ash Shilkin, the company is also scheduled to abolish its 60-day inactivity fee.
There are, of course, some fees, like when a ChimpChange user uses the company’s debit card to make a withdrawal from an ATM outside of the 24,000 on the company’s network. Nevertheless, “you can by and large get by with a free account,” said Shilkin.
What enables all of the frees in the above paragraph is that the company’s revenue model has shifted from the customer to the merchant. According to Shilkin, ChimpChange takes a cut of the interchange fees a merchant pays every time a ChimpChange debit card is swiped. If, as Shilken claims, the company has 100,000 customers, this system just might work.
Aside from the lower fees, ChimpChange, like credit unions, is developing a suite of products intended to improve customers’ financial health. A feature that will auto-categorize spending and present it in an easy-to-digest fashion, a budgeting feature, and a round-up savings account are all in the works.
Shilkin is quick to distance ChimpChange from credit unions. “What they are not always strong in, to put it kindly, is technology and providing tools over and above that basic bank account,” he said. But he’s just as quick to acknowledge that ChimpChange isn’t exactly a unique product. From the payment side, you’ve got Venmo, Apple Pay, Snapcash, and Stripe, just to name a few. And in terms of low-cost bank accounts, Simple is also out to help people budget and save.
The added value of ChimpChange is supposed to be in the mashup of all of the app’s different components: payments, checking, and financial behavior. Whether or not this mashup actually sets ChimpChange apart from the competition, the company serves as a good example of how credit union practices and principles are influencing emerging fintechs.
The continuum goes both ways.