Earlier writing. I wrote this during my time in financial services, and it’s left here as it was published. More earlier writing
Small Credit Unions Can’t Afford AI. So Stop Buying It Alone.
A $400 million credit union can’t staff a data science team. It can’t afford a full Snowflake build, a governance lead, and three analysts. So it does one of two things: it buys a tool it can’t operate, or it opts out of the AI era entirely and hopes nobody notices.
Both are losing strategies. There’s a third option, and it’s the most cooperative idea in banking, sitting right there unused.
Pool the capability.
Here’s the math worth running. Fifteen credit unions under $1 billion each spend, conservatively, $150,000 a year trying to do data work badly: a half-built platform, a stretched-thin analyst, a BI license collecting dust. That’s over $2 million a year buying fifteen mediocre outcomes.
Combine that spend and you can fund a real shared analytics function. One platform. One team that knows what it’s doing. One governance model. Fifteen institutions getting capability none of them could buy alone.
If anything, this is the founding idea. Credit unions exist because individuals pooled resources to get access to credit they couldn’t get alone. The shared analytics model is the same move, one layer up. Institutions pooling resources to get access to intelligence they can’t build alone.
The objections, answered
- Our data is too unique to share infrastructure. It isn’t. Your core is one of four vendors. Your members behave like everyone else’s members. The platform is shared. Your data stays yours.
- We would lose competitive edge. You aren’t competing with the credit union two states over. You’re both competing with the megabank that already has all of this.
- Governance would be a nightmare. Governance is a nightmare now, except you’re each failing at it separately and expensively.
The banks consolidated to get scale. Fintechs raised hundreds of millions to get scale. Credit unions have a structure built for exactly this kind of cooperation and have mostly refused to use it for the one capability that now determines who survives.
The institutions that figure this out won’t just survive the AI shift. They will prove the cooperative model still works, at the exact moment everyone assumed it was dead.
You don’t need to win the AI arms race alone. You were never supposed to do anything alone. That was the whole point.
