1. Mobile payments
Mobile payments are growing 68% annually—from $16 billion in 2010 to a projected $214 billion by 2015. Industry observers say this transaction type is the single greatest opportunity—and threat—for credit unions in the foreseeable future.
Mobile payments could be a game changer. Members used to come to credit unions to get cash and credit union-branded checks or plastic cards. But they won’t be coming to credit unions to get their mobile payment-branded devices. Mobile payments will be driven by access, not devices.
Don’t think mobile payments technology is just about payments. The technology provides a unique opportunity to increase your credit union’s overall franchise value by building a member relationship management database where your members are known and contactable before, during, and after each payment.
By aggregating services inside their own mobile apps, credit unions can benefit from increased spending and the opportunity to advertise, attract new members, better understand members’ needs, offer incentives, provide direct and complementary advertising from mobile app partners, and broker connections to business partners.
The strategic issue revolves around where you want this functionality to reside. Do you want it under your control in your own app, or under the control of retailers and unauthorized third parties who already have launched mobile payments strategies and continue to inject more resources into those initiatives?
“The one who enrolls is the one who controls,” says Richard Crone, CEO and founder of Crone Consulting and author of the E-Scan’s chapter on mobile payments.
NEXT: Mobile banking