3 payments shifts for credit unions to consider while rebalancing branch networks with other delivery channels.
How credit unions should reopen physical locations after the pandemic is part of a larger question, says Larry Pruss, SVP of CUESolutions Bronze provider Strategic Resource Management Inc., Memphis. That question is: “How have members changed how they use financial products and services?”
He shares observations for credit unions to consider as they rebalance their branch networks with other delivery channels in these times:
Contactless payments. Members are making greater use of contactless card transactions, ones that don’t require touching a card reader or PIN pad—or even a card—besides being quicker and more convenient. Data show that 41% of U.S. consumers used contactless payments for the first time during the pandemic, he reports. In addition, 35% added a card to a digital wallet, according to Pew Research Center, in a study sponsored by Fiserv, Brookfield, Wisconsin, and The Financial Brand. Digital wallets, after a slow start, took off during the pandemic. Credit unions need to position themselves to cash in on contactless payments, he advises.
P2P payments. Used by 20% to 30% of U.S. consumers before the pandemic, person-to-person payments will surge to 50%, according to surveys from Chase Bank, CapGemini and Statista. If credit union cards don’t link to Zelle, Venmo or PayPal, they will lose out on such transactions, he predicts.
Cryptocurrencies. These have been growing and gaining acceptance during the pandemic, Pruss says. It’s hard to see just how credit unions might play in a cryptocurrency world, but the more payments bypass card networks, the more interchange financial institutions will lose. The impact of cryptocurrencies on credit union revenue due to this shift in interchange income needs to be studied, he says. cues icon
Richard H. Gamble writes from Grand Junction, Colorado.