There are many challenges for credit unions in delivering multiple forms of mobile payment. The key in today’s environment is staying flexible and secure while giving members choices.
Just a couple of years ago when Apple Pay launched, some credit unions were hesitant about joining the mobile payment movement.
“Some had to pause and take the time to choose if they were going to participate,” Cindy McGinness, manager of digital channels for the St. Petersburg, Fla.-based CUSO PSCU, said.
Today there are more options, including Android Pay, Masterpass by Mastercard, Microsoft Wallet, Samsung Pay and VISA Checkout. Additionally, larger retailers, such as Walmart and Kohl’s, are offering their own alternatives to emerging mobile payment systems, giving consumers even more choices.
“As the mobile wallets have been introduced to market, credit unions are more comfortable with the idea of mobile payments. Once they decided to participate in one then it was a much easier decision to choose to opt into others,” McGinness said.
However, more choices create additional, critical decisions for credit unions.
“The key delivery challenges from a product standpoint are time and resources. Each wallet requires the credit union to get familiar with it to best support members in using the applications,” Amanda Smith, manager of emerging products and integration for the Rancho Cucamonga, Calif.-based CUSO CO-OP Financial Services, said. “While the requirements for enrollments into these new wallets are almost identical, they all take time to implement and test.”
BI Intelligence estimated U.S. in-store mobile payment volume will reach $75 billion this year and anticipated a volume of $503 billion by 2020. It also noticed while the mobile wallet ecosystem is maturing, in-store mobile payments are not yet taking off because of consumer apathy, coupled with delays in total implementation of the required infrastructure.
Apple Pay adoption, for example, is low, according to research from the Dallas-based Parks Associates. Only 10% of iPhone owners have used Apple Pay, and, among those who have not used it, 63% said it is because their preferred merchants do not support it as a payment option.
“Only 19% of U.S. smartphone owners and 15% of smartwatch owners have used a mobile payment app,” the firm said.
Read more about mobile payment adoption at credit unions in the Oct. 26, 2016 print issue of CU Times.
