CO-OP Financial Services is developing a mobile app that will give consumers the ability to activate and deactivate card capabilities on the fly. 

"Instead of just an on and off switch, users will be able to control how their cards can be used," said Michelle Thornton, manager of core products for CO-OP, a Rancho Cucamonga, Calif.-based credit union service organization that has about 3,500 credit union members with about 50 million cardholders.

The new app, called CardNav by CO-OP, will be introduced Oct. 22 during a webinar. CardNav will allow consumers to use mobile phones to activate cards, shut them off, manage location-related risk, set and change spending limits, and set parameters for transaction and merchant types. These controls will be accompanied by mobile alerts that can enable fast and proactive responses to potential fraud.

"Alerts have been around for a while, but it's the controls that's the benefit here," Thornton said, adding CO-OP has found cardholders who have a more interactive relationship with the issuer tend to use their cards more. Beyond fraud, the alerts also include notifications when the cards are turned off while the consumer is shopping—a subtle reminder. "It's a whole new level of engagement. It's a way to put the cards at the top of the wallet," she said.

CO-OP is also launching an application programming in interface (API) to accommodate credit unions' greater use of the mobile channel.

The API fits with CO-OP's history of sharing technology and other resources among its members. CO-OP uses a proprietary switch to enable a variety of tasks, ranging from shared branching to mobile transactions to remote deposit capture.

CO-OP's shared service products fall into three business lines, including shared branching and call center, mobile and other digital channels, and card payments. For years CO-OP has used this infrastructure to offer services such as information on the EMV migration, payments processing and a "shop local" merchant rewards program.

Through the API, CO-OP will extend tools its member credit unions, which can add CO-OP's technology and functions to their own mobile banking or payment apps. "The credit unions can integrate into a mobile wallet or whatever mobile function they want to," Thornton said.

Card controls can be a beneficial tool for credit unions, regardless of the mobile wallet the consumer is using, said Thad Peterson, a senior analyst at Aite Group.

"For example, if the CU's card was top-of-wallet for Apple Pay, the controls could ensure that a kid didn't overspend, or spend at all, on the account," he said. "It would also be good when incorporated into the mobile banking app to provide additional information and security."

Credit unions in general are also starting to warm to mobile wallets, given the technology's ability to deliver special offers and other marketing programs. CU Wallet, for example, is developing a mobile wallet services through a network of participating credit unions, a model similar the Merchant Customer Exchange's CurrentC mobile wallet, which is driven by retailers.

Credit unions will benefit most by enabling other companies' mobile wallets, Peterson said.

"It seems to be that mobile wallets will be dominated by the enablers of the payment, be they hardware providers such as Apple, or merchants such as Amazon," he said. "I think it will be a struggle for credit unions to get traction with propriety mobile wallets. A better strategy might be to position the alerts on the customer card side and then let the customer choose which wallets they wish to use."

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