The future of auto lending is automated–is your credit union ready?
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Credit unions have always stood apart for their focus on members, relationships, and community. That people-first approach is a powerful differentiator, but when it comes to auto lending, today's borrowers are looking for something else too: speed. They want loan decisions in seconds, not days. And if credit unions can't deliver, they risk losing members to fintechs, dealers, and big banks.
Benchmark research from Open Lending's Credit Union Auto Lending Snapshot highlights just how urgent this challenge has become. While most credit unions see automation as the answer, very few have implemented it. The result is a widening gap between what members expect and what many credit unions can provide.
The bottlenecks holding credit unions back
Slow decision-making and limited after-hours capabilities remain major barriers, with 62% of credit unions citing these as pain points. The result? Applications stall, members abandon them, and opportunities for engagement and growth are lost.
Operational costs add to the pressure. Manual underwriting consumes significant staff time, and 58% of credit unions cite fraud detection and risk assessment as their biggest challenges. These hurdles slow down growth and make it harder to expand auto lending portfolios efficiently.
The automation gap
Despite broad recognition of automation's value, adoption remains limited. Only 12% of credit unions have significantly automated their lending workflows. At the same time, 73% say they want to adopt automation in the future.
This gap represents one of the biggest opportunities for credit unions over the next 12-24 months. Closing it will be critical to staying competitive and delivering experiences members increasingly expect.
Proof from early adopters
The data shows that credit unions already using automation are seeing meaningful results:
- Double-digit increases in approval rates
- Reduced loan abandonment
- Improved portfolio performance
These outcomes demonstrate that automation isn't just about efficiency. It directly translates into growth, competitiveness, and stronger member loyalty.
Why it matters now
Automation is more than a technology upgrade; it's a strategic imperative for credit unions:
- Faster decisions build trust and keep members engaged.
- Operational efficiency reduces costs and frees staff to focus on service.
- Smarter risk management helps expand approvals safely and responsibly.
In today's market, the ability to say "yes" quickly and confidently is what will set credit unions apart.
Looking ahead
The future of auto lending will be defined by speed, precision, and member experience. Credit unions that embrace automation now can expect to be better positioned to compete with larger institutions, grow their portfolios, and deliver on their member-first promise in a digital-first world.
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