MADISON, Wis. (2/21/14)--Credit unions need to be active in the changing market for payments systems despite uncertainty over its future, a Filene Research Institute report concluded.
The report, based on a recent Filene colloquium in Salt Lake City, found that members want to increase mobile banking options, even if they are rapidly changing.
But while there is far from a consensus on how the dust will settle, the colloquium agreed that demand is robust and isn't currently being fulfilled by credit unions.
"Members want to make payments to anyone, from anywhere and through any account," the report stated. "Most credit unions don't currently have the systems in place to make this happen, but they do have strengths that will serve them well in reaching this critical goal."
Muddying the waters, speakers said, was the fact that best practices or services aren't yet clear. Credit unions are grappling between different types of IT--namely the choice between near-field communications and cloud technology--and the extent to which services should be outsourced.
The report noted that credit unions can get a leg up in the competition for payment service demand by stressing their reputation for "better money management." It added that effective use of transaction data, "developing better ways to deliver plastic" and digital wallet development are prerequisites in this line of branding, however.
"Credit unions can't afford to take a wait-and see approach to the payments conundrum," the report concluded.
Experts at the event, from both inside and outside the credit union, discussed the digital wallet, emerging payments and how Canadian credit unions are changing with respect to payment services. They discussed the effect of payment services on revenue opportunities and member relationships.
A panel discussion also covered significant payment drivers, the importance of data, whether credit unions can compete when price drives consumer and merchant decision-making and why credit unions must embrace collaboration.