Mobile wallet services continue to grow in adoption, but how can your credit union build loyalty through these programs, what are the latest trends, and what are the newest types of fraud to be on the lookout for? We asked Rebekah Higgins, Synergent’s Vice President of Payment Services, to share her insights on the latest information and best practices for mobile wallets and member engagement.
1. Benefiting From the Mobile Wallet Ecosystem
With the addition of “The Pays” and other emerging payment apps, payments are moving in the mobile direction. A related advantage for credit unions can be found in the reward programs that are linked to card usage. Credit unions should continue to focus on ensuring that their card is top-of-wallet, and start also focusing on being top-of-app. Rewards providers are also developing technology that allows cardholders to now pay with points at checkout as a new form of redemption. This process is being developed through mobile apps and continues to enforce the usage of the card linked to these programs.
2. Be on the Lookout for Fraud
At this time, fraud associated with mobile payments is more identity-based than card-based. The trends we are seeing involve a perpetrator who has been able to gather card information. However, in order to enroll a card into a payment app, additional information such as transaction history is required. Perpetrators will go to great lengths to obtain this transaction history, including tactics to appear as if the legitimate cardholder is gathering this information.
3. Current Trends & Features in Demand
Ease of use is definitely a driving force in adoption and continued use of these services. Trends show that if a consumer has difficulty using a mobile app on the first attempt, it is difficult to persuade them to try this payment method again. Additionally, consumers are looking for incentives to change their payment behavior. Many merchants have been successful in transitioning consumers to use their payment apps based on rewards, discounts and/or convenience such as shorter wait times – or in some cases, not having to go through the check-out process at all.
4. Standing Out in the FI Crowd
The payment apps that merchants are offering are a clear way to stand out amongst the financial institution competition. While the MCX product CurrentC has gone by the wayside, we are seeing merchants develop their own payment apps that provide high value to consumers who frequent their locations. Credit unions should continue to assess how they can add to the value provided by the services offered by the merchants by offering customized rewards for high-volume merchant locations. It is uncertain at this time how real-time ACH processing could impact this environment. Merchants have historically looked for ways to circumvent the payment networks, but if credit unions solidify the value of using a card for these transactions now, this spending pattern will become second nature to members, making it more difficult for a merchant to persuade a consumer to transition from this payment method.
5. Building Loyalty through Mobile Wallet Services
Have a package for members to use that they can identify as being associated with their credit union. Branding is an important part of this process, as is offering different mobile tools within this package for all of your members’ needs. This would include access to their accounts, payment methods, and security, such as card control apps. By offering this as a one-stop app, members do not become overwhelmed with multiple apps for different functions and they will be front and center as new items are developed and implemented in this environment.