No one knows which mobile payment technology will ultimately win or how long it will take for mass adoption among merchants, but we do know for certain that credit unions find themselves at an inflection point in the payments industry, and they are not alone.
Massive technology companies including Google, ISIS, Paypal, Amazon and Apple, who have little interest in the highly regulated banking industry, recognize being first to enroll mobile wallet customers provides them a marketing platform opportunity that will be far more lucrative than interchange.
These powerful new competitors have created urgency around an organized mobile wallet credit union initiative; even the largest credit unions lack the leverage to succeed alone. Only by working together will credit unions successfully reduce third party control over the infrastructure deployed and in the process reduce costs, increase net new revenue streams, solidify the trusted banking relationship and create a better experience for members.
Pursuing a cloud-based mobile payment solution provides credit unions a unique opportunity to avoid the volatility currently impacting the market, while remaining agnostic to any particular technology, and not be forced to commit significant resources to a single solution that would leave them in an all-or-nothing position.
Today, a mobile payment platform that leverages a QR code solution is universally the least common denominator for existing mobile devices and merchant point of sale systems, but this solution can be future-proofed by leveraging a cloud-based common platform that can also use any access technology; be it bar codes, NFC, HCE, BLE, ultrasonic, etc.
The collective, collaborative power of the credit union industry, combined with a common cloud-based mobile payment platform, positions credit unions for future success. As merchant customer exchange retailers pilot and prepare to roll out individual mobile payment programs and with Subway restaurants having just recently launched nationwide mobile payment acceptance (a very real example of a cloud-based common platform).
Starbucks is often touted as the tangible success story by mobile payment proponents. Arguably, it's an overly specific use case with very loyal shoppers who buy the same product from the same merchant and use the mobile wallet at least partly for the rewards. From the nearly 20% of Starbuck's in-store sales currently paid for with the mobile app,consumers will demand a mobile payment app long before there is ubiquity among merchants.
Paul Fiore
CEO/Founder
CU Wallet
Woodland Hills, Calif.
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