In October 2012, Walmart and American Express rolled out the Bluebird prepaid card, with its direct deposit capability via mobile phone. Time will tell what impact this has for credit unions involved in similar initiatives.
About half of the 68 million unbanked or underbanked consumers in the U.S. prefer to conduct their financial business at a financial institution, and the rest prefer retail outlets, according to the Center for Financial Services Innovation (CFSI).
“There’s enough opportunity for different providers to get a piece of the pie,” says Karen Biddle Andres, CFSI’s senior manager and consultant for advisory services.
In fact, she believes credit unions can capitalize on Bluebird’s arrival. Consider that Walmart and American Express have invested heavily in raising consumers’ awareness of prepaid cards.
“If I were a credit union, I’d see that as a big opportunity,” Biddle Andres says. “Offer something just as easy and accessible, and tell consumers you have the advantage of offering other products and services as well.”