CUSO Tech Updates: Payments, Reporting & the Digital Experience

A variety of tech-related CUSO news includes a new payment partnership, a fintech innovation platform, a service organization security report availability, and creation of a core optimized digital experience.

The Glastonbury, Conn.-based digital payments company Payrailz announced the launch of its new CUSO, CU Payz, which allows credit unions to control their future by partnering with Payrailz to develop new, innovative payments technologies, services and experiences.

CU Payz’s formation developed from a working relationship with established CUSOs Minneapolis-based MEMBERS Development Company and Raleigh, N.C.-based Constellation Digital Partners. CU Payz has six founding member credit unions: Coastal Credit Union ($3.3 billion, Raleigh, N.C.), Farmers Insurance Federal Credit Union ($987 million, Los Angeles), Georgia’s Own Credit Union ($2.4 billion, Atlanta), Meritrust Credit Union ($1.3  billion, Wichita, Kan.), Teachers Credit Union ($3.3 billion, South Bend, Ind.) and TwinStar Credit Union ($1.4 billion , Lacey, Wash.).

“As the industry becomes more competitive, credit unions are looking for innovative ways to address the growing discrepancy between traditional tools built for the financial services world, and the rapidly changing fintech payments players,” said Kris Kovacs, CEO of Constellation Digital Partners. “CU Payz is dedicated to giving credit unions the means to adapt and better compete.”

“Credit unions have been handcuffed by some of the current providers, and we strongly believe we will offer a solution that enables them to compete against all the other tech competitors jumping into the market. It’s time for credit unions to take control of the member experience, and we are excited to be able to empower these FIs through our own CUSO,” Fran Duggan, CEO of Payrailz said. “Technology is instrumental in helping today’s credit unions create the optimal member experience, and we are proud to not only provide this technology, but now work directly with credit unions to partner on the development of our technology moving forward.”

Columbus, Ohio-based Sherpa Technologies — aimed at simplifying digital transformation solutions and CUSO of Corporate One Federal Credit Union — launched a fintech innovation platform, FintechAccel | CU. The platform’s focus will be to work with industry executives to identify and solve issues facing the credit union industry by finding, fostering, showcasing, and partnering with fintech startups.

“When we launched Sherpa, it was with a singular focus: leading the member experience journey for credit unions,” Keith Riddle, president and CEO of Sherpa Technologies said. “Our partnership with the operating team and program participants at FintechAccel | CU allows us to build on that mission by linking credit unions with the top fintech startups in the world to solve our industry’s unique problems.”

Sherpa intends to collaborate with fintech providers to standardize due diligence and streamline solution vetting through a combination of unique functionality embedded within the Mosaic digital business platform and innovative testing tools from Connect Financial Software Solutions, a partner and program participant. Mosaic will also leverage to accelerate the integration and distribution of fintech solutions to the credit union industry.

Initial sponsoring participants of FintechAccel | CU include: Corning (N.Y.) Credit Union ($1.5 billion), Gulf Winds Credit Union ($692 million, Pensacola, Fla.), Kemba Credit Union ($967 million, West Chester, Ohio), Virginia Credit Union ($3.7 billion, North Chesterfield, Va.), Northrop Grumman Federal Credit Union ($1.2 billion, Gardena, Calif.), One Nevada Credit Union ($938 million, Las Vegas) and ConnectFSS, which is owned by One Nevada.

In order to remain agile in their endeavors in their first year, FintechAccel | CU pointed out it will engage with fintech startups that align with problem statements prioritized by the program participants and focus on improving and enhancing member experience, deposit acquisition, lending, and digital transformation.

The CUSO plans to invite startups participating in the inaugural cohort to attend Sherpa’s FintechAccel | CU one-day Fintech Showcase hosted in Tampa, Fla, this November. The application process for fintech startups begins August 15, 2019.

Grand Rapids, Mich.-based CU*Answers, a 100% credit union-owned core data processor, announced the availability of its most recent SSAE-18 Service Organization Control (SOC) 2, Type II report. Completed by Crowe, LLP, the report verifies the existence of internal controls designed and implemented to meet requirements for the security principles set forth in the Trust Services Principles and Criteria for Security, Availability, Processing Integrity and Confidentiality.

The SOC 2 report addresses a service organization’s controls pertinent to their processes and compliance, as defined by the AICPA’s Trust Services Criteria.  The Type II report not only concerns the policies and procedures in place, but validates their effectiveness over a 12-month period. This independent SSAE-18 validation of security controls is crucial for clients and their members.

“The SOC 2 report is indicative of our commitment to transparency in our security efforts,” Patrick Sickels, CU*Answers internal auditor, said. “By having our SOC 2 report finalized, we are demonstrating to our clients and client-owners we are dedicated to continuous improvement in our security practices.”

Rocky Hill, Conn.-based DaLand CUSO, a next-generation technology CUSO, announced formation of its CODE (Core Optimized Digital Experience) Council, a technology framework developed by Aurora, Colo.-based DaLand that emphasizes extending core platform functionality in lieu of bolting on add-on products. The first two members of the CODE Council are Blue Federal Credit Union ($1.1 billion, Cheyenne, Wyo.,) and Nutmeg State Financial Credit Union ($454 million, Rocky Hill, Conn.).

“DaLand CUSO is committed to partnering with credit unions seeking relevance through adopting the core-centric philosophy, which integrates modern technology as a ‘core’ component of a credit union’s composite technology and strategic business plan,” DaLand CUSO CEO Jeff Levesque, said “The CODE Council spotlights our most dedicated partners – those committed to the transformative process of regaining control of their data and driving business from the core to improve member experiences, which will allow these leading and innovative credit unions to share the results of this strategic framework with the industry and demonstrate a relevant and sustainable posture for the modern community financial institution.”

DaLand CUSO is seeking three more credit unions to join the CODE Council.