CUs wait, watch as digital wallets unfold
MADISON, Wis. (6/1/15)--A new white paper from the CUNA Operations, Sales & Service Council offers guidance to credit unions in developing a digital-wallet strategy.
The digital wallet industry remains a wild west of sorts, which is comforting news for those credit unions that have yet to make a definitive decision on member offerings, according to the paper, “Physical-Digital Wallets: The New Payment Strategy.” The biggest issue with digital/mobile wallet adoption is what technology merchants plan to embrace coupled with consumer choice and preference.
But mobile wallet adoption appears imminent as consumers rely increasingly on their mobile phones for financial transactions and competitors continue the race to develop digital payment standards. (See related News Now story: Google boosts Android Pay with payment-network support.)
Banking transactions are occurring in greater numbers via mobile devices, according to the Board of Governors of the Federal Reserve’s Consumers and Mobile Financial Service’s Survey (March 2015). Statistics from a December 2014 survey found that 39% of all mobile phone owners with a bank account used mobile banking in the 12 months prior to the survey, which was up from 33% in 2013 and 29% in 2012. Additionally, 52% of smartphone owners with a bank account used mobile banking. Mobile payments with smartphones were the most common type of mobile payment at 68%.
During the same time period, the survey found that 47% of smartphone users’ comparison shopped with their phone while at a retail store, with 33% using their phone to scan a product’s barcode to find the best price for the item. Additionally, 29% of all mobile phone users and 38% of smartphone users used their phone to track purchases and expenses.
“Mobile wallets should be a core portion of a credit union’s payments strategy,” said John Schweikert, senior director of payments for the digital banking solutions firm Digital Insight. “In-store and online payments are a significant driver of spending, and the core of any mobile wallet strategy is ensuring that your cards are top-of-wallet.”
Mobile wallets will be among the topics addressed at the 2015 CUNA Payments Roundtable, which begins today in New Orleans. The event is produced by the CUNA Center for Professional Development and endorsed by the CUNA CFO Council and CUNA Operations, Sales & Service Council.