news.cuna.org/articles/109005-whats-the-next-big-thing-in-2016-part-one
What's the Next Big Thing in 2016? Part One

What’s the Next Big Thing in 2016? Part One

Three-part series examines key developments in the coming year.

January 8, 2016

Regulations, fraud, security, and the need for digital engagement will shape the financial services landscape in 2016, according to a panel of credit union technologists, payments providers, and mortgage experts.

Here’s what five providers believe will be the “next big thing” in 2016.

Santo Cannone

Santo Cannone

Focus on Digital Engagement

Growing member demand for a full range of digital services will prompt credit unions to focus on digital engagement in 2016.

Credit unions are continuing to adopt innovative technology to deliver a robust, multi-channel member experience with 24/7 services for the speed of life today. We expect this demand to increase in 2016 and beyond, as members of all age groups increasingly engage credit unions for everyday services through digital channels.

At Fiserv, we believe the key to future success for our clients is integrated solutions that encompass channels and core processing, facilitating a consistent multi-channel experience and delivering key insights supported by actionable analytics.

SANTO CANNONE is chief product officer, credit union solutions, for Fiserv.

Next: Emerging payment technologies



Regulations, fraud, security, and the need for digital engagement will shape the financial services landscape in 2016, according to a panel of credit union technologists, payments providers, and mortgage experts.

Here’s what five providers believe will be the “next big thing” in 2016.

Thomas Davis

Thomas Davis

Evolve Payments with Emerging Payment Technologies

As credit union Europay, MasterCard, and Visa (EMV) projects transition into our daily operations, credit union payment executives’ focus will shift from card present fraud prevention afforded by EMV to enabling more ways to pay, and to card not present fraud protection technologies.

Tokenization, which is the backbone to the “pays” (Apple, Samsung, and Android) and Visa Checkout and Master Pass, will move front and center in 2016. Tokenization enablement projects will have similarities to EMV in the aspect of enablement and staff and member education.

The Visa Digital Enablement Program and the MasterCard Digital Enablement Service, which were introduced in 2015 to streamline the enablement process, will go a long way in helping our credit unions close the gap with the early adopters of these technologies.

As more emerging technologies become available to credit union members, it will be imperative for credit union payment credit union service organizations, processors, and brands to be innovative in the enablement process to allow credit unions to be able to offer new products economically and in a competitive timeframe.

Because in many cases cardholders will have to “choose” to use credit union emerging payment technologies, credit unions will need to be creative in the way that they incent their cardholders to use their new products.

Emerging payment technologies will provide new platforms, such as mobile wallets, that will level the playing field and provide exciting new delivery channels for credit unions to deliver loyalty programs.

Traditionally, it has been the financial institutions that have been on the forefront to deliver card loyalty programs. However, merchants are starting to provide merchant-funded programs at the point of sale in an attempt to compete for consumer loyalty.

Credit unions will be challenged to continually evaluate their loyalty programs to ensure the value proposition is meeting both the needs of their members and their bottom-line goals.

THOMAS DAVIS is senior vice president, finance and technology, for CSCU.

Next: Card-not-present fraud



Regulations, fraud, security, and the need for digital engagement will shape the financial services landscape in 2016, according to a panel of credit union technologists, payments providers, and mortgage experts.

Here’s what five providers believe will be the “next big thing” in 2016.

Kent Potterton

Kent Potterton

Combat ‘Card-Not-Present’ Fraud

Every credit union is concerned about increasing fraud losses. A large, looming issue for credit unions in 2016 will be developing ways to combat card-not-present fraud.

This could be through the one-time use of account numbers (or tokens), tokenizing merchants with accounts on file (like Amazon, iTunes, etc.), cloud services (like VISA CheckOut or MasterCard MasterPass), or revolving personal identification numbers.

Additionally, credit unions will need to determine how to get members to use these new approaches given they have $0 liability for fraud losses.

KENT POTTERTON is vice president of card solutions consulting for PSCU.

Next: Offset falling mortgage income



Regulations, fraud, security, and the need for digital engagement will shape the financial services landscape in 2016, according to a panel of credit union technologists, payments providers, and mortgage experts.

Here’s what five providers believe will be the “next big thing” in 2016.

Paul O'Connor

Paul O'Connor

Offset Falling Mortgage Income with Purchase Volume

How will your credit union mortgage loan program grow in 2016?

First mortgages currently make up the largest segment of credit union loan portfolios, and have experienced consistent growth over the last three years.

This growth has been spurred by low interest rates and exceptional refinance loan volume.

The Mortgage Bankers Association’s most recent 2016 market forecast calls for a 35% decline in refinance transactions due to the expected increase in 10-year Treasury yields. This reduction will have a significant impact on credit union income due to lost origination and loan sale income.

To offset this loss, credit unions need to tap into the expected 11% increase in purchase volume for 2016.

Credit unions need to start cultivating Realtor and builder relationships now to take advantage of increased purchase volume next year.

PAUL O’CONNOR is vice president/director of operations for QR Lending.

Next: Focus on regulations, fraud, and security



Regulations, fraud, security, and the need for digital engagement will shape the financial services landscape in 2016, according to a panel of credit union technologists, payments providers, and mortgage experts.

Here’s what five providers believe will be the “next big thing” in 2016.

Amanda Smith

Amanda Smith

Focus on Regulations, Fraud, and Security

I think credit unions are going to need to keep a continued focus on regulations, fraud, and security.

When new payment channels develop, it does not take long for fraudsters to come up with ways to leverage these new channels for less than virtuous purposes.

Regulations are sure to follow once there has been some time for the industry to digest these events.

Although often burdensome, there has been so much movement in the payment space that we are sure to see an influx of regulatory activities intended to shore up the anti-fraud and security aspects of the new technology offerings.

AMANDA SMITH is strategic product architect for CO-OP Financial Services.

This is the first of a three-part series. Check back Jan. 15 for part two of this series, and Jan. 22 for part three.