Prioritizing Humanity to Maximize Success in 2026

The strategies financial institutions should be focused on for growth, stability and profitability in the coming year and beyond

With 2026 now underway, banks and credit unions are implementing their plans and roadmaps for the coming months. While key concerns like deposit growth and margin compression are likely to remain priorities throughout the year, institutions would do well not to overlook their accountholders who are so critical to all aspects of their businesses. They must evolve from viewing their customer interactions as merely operational or transactional and, instead, as the vital, ongoing relationships they truly are.

To realize true growth and profitability in 2026, banks and credit unions should consider prioritizing digital strategies that are both personalized and human centric. By effectively leveraging their data and intelligence to better understand both their current and potential accountholders, institutions can strengthen those relationships and, in turn, their deposit franchises, proactively optimizing balance sheets.

The urgency for why banks and credit unions should focus on a better understanding of the financial goals and needs of their accountholders is backed by compelling data.

As consumer interactions and expectations have continued to change in the digital age, so too have their views and relationships with their financial institutions. A recent survey on banking relationships found that 67% of accountholders do not feel truly known by their primary financial institution, while 31% feel as if they are merely another account number. Moreover, over half of those surveyed (53%) would consider switching institutions if another offered a more personalized experience.

While important for institutions of all sizes, this is especially true for community financial institutions as they continue to lose ground, especially with younger consumers. Data from McKinsey highlights how market share for primary checking accounts has dropped for credit unions from 17% to 13% from 24% to 15% for smaller banks between 2015 and 2024. Meanwhile, more nonbanks and fintechs continue to aggressively target younger consumers with slick digital experiences. Without a shift in focus, today’s community institutions increase their risk of becoming secondary or tertiary institutions for their accountholders, or ultimately, even acquisition targets.

Regardless of size, to help protect against this outcome, financial institutions should prioritize several key areas for the coming year.

Using intelligence to better understand customers and build deeper relationships

While tools like AI and advanced analytics can be gamechangers, their use cases go far beyond only automation. Leveraging these technologies to gather behavioral insights and segment customers allows institutions to better understand accountholders and their needs, and then effectively act on that information to deliver relevant personalized services and products. This creates both loyalty and growth opportunities.

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Evolving to deliver both humanity, along with technology, in the digital landscape

Banks and credit unions should aim to transform their branches into “client experience centers,” shifting teams from mere order takers to be empowered, proactive relationship managers. As even the best technology alone cannot deliver humanity, institutions must integrate the right tech with true empathy to create meaningful experiences that can ultimately lay the groundwork to drive more organic, effective opportunities.

Adamantly focusing on building a strong deposit franchise

Deposit strength continues to be the foundation of valuation for today’s institutions. Banks and credit unions that fail to both protect and grow their core deposit base risk losing not only market share but also their stock price stability.

Proactively optimizing net interest margin (NIM) and balance sheets

Institutions should prioritize adopting relationship-based pricing especially for critical commercial accounts, then target and deepen those operating relationships. By identifying and improving tightly priced loans and striving to better understand deposit pricing sensitivity to optimize interest expense, financial institutions can maintain their profitability amid any rate volatility the market experiences.

Preparing for increased merger and acquisition (M&A) activity – and understanding your own customers

As organic growth continues to slow and larger national institutions and fintechs capture more market share, M&A will likely accelerate this year. It is imperative institutions of all sizes understand their own churn rates and key problem areas.

Financial institutions are at a true inflection point. As consumers increasingly demand more personalized services, banks and credit unions that can blend the right data‑driven insight and tech with humanity will be best equipped to meet these rising expectations. By unifying their data, tools and teams around a human‑centric approach to profitability, institutions can more effectively create relevant experiences, strengthen deposit growth, manage margin pressures and stay competitive. Institutions that act on these interconnected levers with clarity and speed will be far better positioned to navigate 2026’s challenges and turn them into long‑term strategic advantages.

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