In today’s financial landscape, achieving Primary Financial Institution (PFI) status isn’t just a nice-to-have - it’s the difference between a shallow relationship and a lasting one. When your credit union becomes the place members trust to deposit their paychecks, pay their bills, borrow for their goals, and track their financial progress, the results are transformative: higher engagement, deeper trust, more products per member, and stronger revenue.
But getting there? That’s harder than ever.
Digital-first banks are no longer just disruptors; they’re now the default for younger generations. According to Cornerstone Advisors, only 30% of Gen Z consider a traditional financial institution their PFI, with 45% citing a digital bank or fintech 1. With fewer members relying on branches and more choosing their banking apps like they choose streaming services, credit unions must rethink how they build loyalty.
Why PFI Status Matters
According to Raddon Research, members who identify their credit union as their PFI are five times more profitable than those who don’t - and are more likely to hold auto loans, credit cards, and mortgages with the credit union instead of a competitor 2.
These are not just deeper relationships - they’re stickier, more resilient, and more impactful for the bottom line.
The Credit Union Opportunity
Unlike large banks or faceless apps, credit unions are built for relationships. When paired with intelligent, timely digital engagement, this gives them a unique advantage…but only if they act on it.
To earn PFI status, credit unions are deploying strategies that prioritize:
Real-time digital wallet provisioning
In-session cross-sell for loans and deposits
Smart onboarding experiences that don’t just capture interest - they convert it
Rethinking Member Profitability: From Taboo to Tactical
In credit union circles, “member profitability” can feel like a dirty word. After all, CUs aren’t built to maximize profit per user - they're built to serve. But ignoring profitability entirely means missing critical insights about member behavior, relationship depth, and long-term sustainability.
The truth? Not every member relationship is equal, and that’s okay.
Across most credit unions, the member base falls into three broad categories:
~20% are highly profitable: These members typically carry multiple products, maintain strong deposit balances, hold loans, and consider the credit union their PFI.
The majority are marginally profitable: They may use one or two products, keep small balances, or interact only occasionally.
A small subset are significantly unprofitable: These members may require high servicing and/or acquisition costs, or generate charge-offs.
So what do you do with that data? You certainly don’t offboard members.
Instead, the strategic move is to understand what separates the top 20%. Ask:
What products and behaviors led them to that tier?
How did their journey start, and what helped accelerate it?
Are there common traits among members just one or two steps behind?
What can you proactively influence to create more high-value relationships?
The goal isn’t to cherry-pick - it’s to elevate the entire membership. That starts with data. The kind of actionable, real-time insight that lets you nudge a new member toward a second product, prompt an in-session loan refinance offer, or spot a direct deposit drop-off before it becomes a churn event.
And guess what? The most profitable members are almost always your PFI members. They’ve chosen you for more than just a good rate - they’ve chosen you to be their financial home.
What Credit Unions Can Do Now
Invest in onboarding that converts, not just attracts. Ensure your digital account opening and loan application flows surface relevant offers, minimize abandonment, and use identity intelligence to move with speed.
Make switching easy. Embedded digital wallet provisioning, direct deposit switching, and real-time card funding can help new members start transacting right away, reinforcing the PFI connection.
Use data to deepen, not just detect. Don’t wait for members to churn. Use relationship scoring, behavioral triggers, and journey mapping to guide members to their next best product - before they go looking elsewhere.
Strategic Questions for CU Leaders
Do you know what percentage of your members consider your credit union their PFI today?
What are the common behaviors and product combinations of your top 20% most profitable members?
What data and tools are you using to nudge marginally profitable members toward deeper engagement?
Are your digital onboarding experiences truly designed to capture and activate PFI relationships?
Sources:
Cornerstone Advisors, "What’s Going On in Banking 2024"
Raddon Research Insights, 2023. “Maximizing Primary Financial Institution Status.”
Filene Research Institute, "Understanding Member Profitability"