“Embedded Direct Investing. Cryptocurrency, Stocks, ETF’s, Options. The Cure for Credit Union Dormant Account Crisis, Low Member Engagement, and Member Churn. The Highest of Credit Union Priorities”

By: Ben Malena 💥 Co-Founder AlgoPear

The Hidden Cost of Dormancy

Dormancy is the quietest yet most destructive problem facing credit unions today. On the surface, membership growth often looks healthy — reports highlight net new accounts, app downloads, and login counts. But underneath these metrics lies a troubling reality: anywhere from 20% to 40% of credit union members are digitally inactive. These members rarely log in, rarely transact, and almost never grow their financial relationship with the institution.

This inactivity has very real consequences. A dormant member isn’t “neutral” — they are an untapped deposit, a loan that never happens, a referral never given, an investment never initiated. While they remain on the books as part of “total membership,” their financial lives continue elsewhere. They are wiring money through Venmo, building micro-portfolios on Robinhood, automating savings on Chime, and learning investing basics from TikTok creators who deliver financial education in 60-second clips.

Across the industry, the cost of this silent attrition is enormous. Conservative estimates put the opportunity cost of dormancy at $70 billion annually in missed deposits, cross-sell revenues, investment activations, and loyalty churn. Left unchecked, dormancy slowly erodes the financial foundation of credit unions — not by members leaving, but by members outgrowing.

Direct Investing: The Antidote to Inactivity

The strongest antidote to dormancy is not another marketing campaign or a new rewards program. It’s direct investing. When members are given access to investing capabilities — whether in stocks, ETFs, cryptocurrencies, futures, or options — they don’t just engage; they stay.

Studies across financial institutions consistently show the stickiness of investing:

• Members with direct investing log in 4x more frequently than non-investors.
• Investment-linked members have a 70% higher retention rate over five years.
• Engaged investors are 7x more likely to consolidate additional products — from checking to credit — with their primary institution.

Why? Because investing is inherently behavioral. Checking a balance is a passive action. Watching your portfolio move, setting a goal, or seeing your money grow — those are daily habits. A credit union that provides these touchpoints becomes part of the member’s financial life in a way that a static interface never can.

This isn’t theory; fintech competitors have already proven it. Apps like Stash and Public built engagement loops by combining financial literacy with micro-investing, growing millions of users who now treat those apps as their “home base” for finance. Credit unions can’t afford to ignore the lesson: investing is the new engagement engine.

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 Why Credit Unions Have Fallen Behind

Credit unions were not designed to be laggards. In fact, their values — trust, education, and community — are tailor-made for an era where members want more than just transactions; they want guidance. Yet despite this cultural advantage, credit unions have largely missed the investing revolution.

The reasons are structural. Legacy systems silo investments away from the member experience, often requiring third-party referrals or clunky integrations that feel outdated next to fintech competitors. Regulatory caution has made many executives hesitant to move too quickly. And for years, many credit unions assumed members would not want complex tools — when in reality, the demand for simple, accessible investing has never been higher.

The result? A widening gap between member expectations and institutional delivery. While fintech apps evolve weekly, many credit unions still rely on digital platforms that have not meaningfully changed in a decade. Members who might have invested through their trusted credit union instead turn elsewhere, building loyalty with the very platforms designed to disrupt.

Direct Investing Aligned with Credit Union Values

What makes this moment particularly urgent is that direct investing is not a distraction from the credit union mission — it is a direct extension of it. Credit unions exist to promote member financial wellness, to provide tools that strengthen financial resilience, and to educate communities. Investing is no longer a luxury for the few; it is a necessary pathway for every generation seeking to build wealth.

Millennials and Gen Z, who now make up a growing share of credit union membership, expect investing to be integrated into their daily financial lives.

A 2024 FINRA study found that over 60% of Gen Z adults are already investing, and more than half began before age 21. If credit unions cannot meet that demand within their own platforms, these members will continue to seek solutions elsewhere.

Embedding investing tools does more than drive revenue. It makes credit unions relevant again to the next generation. By coupling direct investing with financial literacy coaching and personalized guidance, credit unions can transform dormancy into daily engagement, positioning themselves as trusted partners in the wealth journey.

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 SELENE AI: The Embedded Solution for Loyalty and Growth

This is where SELENE AI by AlgoPear enters the conversation. Selene was designed not as a bolt-on feature, but as an embedded intelligence that integrates investing, education, and engagement into one cohesive experience — delivered inside your credit union’s brand.

Selene’s capabilities are both broad and precise:

• Multi-Asset Investing: From crypto to ETFs to options, Selene enables members to invest directly without leaving your ecosystem.
• Personalized Portfolios: AI-driven recommendations match members to strategies aligned with their goals and risk profiles.
• Embedded Financial Literacy: Real-time coaching built into the interface ensures members learn while they act, not after the fact.
• Next-Gen Engagement: Daily nudges, goal tracking, and milestone celebrations transform financial wellness into a continuous loop of interaction.
• Brand-First Integration: Selene doesn’t compete with your institution; she enhances it, wearing your colors, voice, and trust.

For credit unions worried about churn, SELENE represents more than a tool — she is a cultural bridge. She reconnects members to their cooperative roots by offering tools that feel modern, relevant, and designed for growth.

The Executive Mandate

The opportunity for credit unions is massive, but it is not indefinite. Every month that members remain dormant, they deepen habits with fintech competitors who are relentless in capturing engagement. Every day without direct investing is another day of missed deposits, missed loyalty, and missed growth.

The mandate for executives is clear: engagement must be designed, not hoped for. Direct investing and embedded literacy are no longer optional; they are the foundation of the next decade of member loyalty.

SELENE AI was built for this moment. A moment when financial wellness must intersect with behavior design. A moment when credit unions can either lead or be left behind.

The keys to your members’ loyalty have already been delivered. The next step is activation.

📅 Schedule your executive demo today and see how SELENE AI can transform your credit union from a dormant platform into a daily financial home.

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