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Crone: Best Digital Solution for CUs is CU-Branded Digital Wallet
Wednesday, June 3, 2015 6:30 AM

Richard Crone of Crone Consulting told attendees of the CUNA Payments Roundtable in New Orleans on Monday that by enrolling in mobile payments, consumers provide themselves not only with the ability to make payments but also access to personalized shopping lists and histories, loyalty information, actionable digital coupons, and other functionality. The mobile device provides a real-time link to their favorite retailers.

According to Crone, while the payments environment may appear daunting to some credit union leaders, financial institutions are well-positioned to capitalize on the wave of digital services transforming the marketplace. However, “signing up for Apple Pay is not a mobile strategy,” he said. “It’s unlikely a single player will own the digital wallet space.”

The best digital solution for credit unions is to provide a credit union-branded digital wallet. “At the end of the day, the safe bet is offering your mobile banking app accessing your accounts and reinforcing your brand,” he said. Crone warns that if a credit union doesn't provide that access, someone else will and that "will diminish your opportunity to add new information-based services through a mobile banking app.”

Credit unions will likely have to support multiple types of mobile payments, Crone said, but digital wallets will also offer opportunities for revenue income. For example, digital wallets offer a channel for retailers to reach the consumer, and a source of revenue for the digital wallet provider. Credit union-branded digital wallets would offer valuable ad space for retailers and a potential source of revenue for credit unions.

Crone pegged mobile advertising and purchase offer opportunities as two to three times greater than gross revenue for traditional card-based accounts.

“The real lift comes when your member engages with you and says, 'I want to do business directly with my credit union,' and you have a mobile wallet to offer them,” Crone said. “You want to get your fair share of this market, but you’re not going to get your fair share unless you have something to put in play. The safe play is your brand in your wallet.”