RANCHO CUCAMONGA, Calif. (8/13/13)--Credit unions should operate from the assumption that mobile wallets aren't a technology of the future, but in fact, are here now, according to a new white paper from CO-OP Financial Services.
What's preventing widespread adoption of the technology is the uneven experience of the options currently available, spotty awareness and low use, said the paper, "Digital Wallets in Depth: What are they? How do they work? And where do credit unions fit in?"
Gartner Inc. predicts 45 million people worldwide will use mobile payment technology this year, generating $235 billion in transactions, in its report, "Forecast: Mobile Payment, Worldwide, 2013 Update." By 2017, the research firm expects the ranks of mobile payment users to reach 450 million, with $721 billion in transactions.
"The gap between expectation and usage is still wide, which makes this the perfect time to get involved," CO-OP's paper said. "Begin now by getting your credit union's cards into mobile wallets. This strategy is not only easy, but it's also smart. You don't have to choose the winning technology. You don't have to create or mobilize your own new technology. Even if things change in the future, there's no real downside to being in today's wallets. And, for the record, interchange works the same in wallets as it does anywhere else."
The paper makes several recommendations about how credit union's can can become involved in the mobile wallet marketplace:
- Encourage adoption. Members at most credit unions are using mobile wallets now, the paper said. Encouraging them to do so--especially in tandem with using payment cards--increases the chances that they will put credit union cards into their wallets. Getting in on the ground floor is an important first step.
- Keep your options open. CO-OP is taking a nonexclusive approach to wallets. The company thinks that's a good approach for credit unions as well. Rather than trying to commit to one product, CO-OP suggests encouraging members to choose their own (or try many)--all with the credit union's cards in hand.
- Focus on mobile payments. People aren't adopting wallets as quickly as they are mobile payments. Aligning the credit union with the mobile payment experience is an excellent way to get members to associate you with mobile wallets in the future, said the paper.
- Stay alert. The digital wallet mark market is evolving; it's important to evolve with it.
To download the white paper, use the link.