Tyfone's mobile wallet is a some-assembly-required approach to smartphone payments: the bank or credit union provides the software, and the end users can choose to load it with gift cards and a Near Field Communication chip for payments.

Security Service Federal Credit Union plans to offer its members Tyfone's iCashe wallet as part of a series of mobile banking and payments services, the companies announced June 4.

Members can link their own payment cards to the digital wallet, as well as link digital gift cards purchased from any of 140 merchants. The gift cards can be delivered by email or text message. Tyfone also sells a memory card with an embedded NFC chip. The removable card, which costs less than $10, allows users to make payments at retailers that accept contactless cards.

"We want to be on the leading edge of technology," John Worthington, Security Service Federal Credit Union's vice president of corporate communications, tells PaymentsSource. "We took our time not only to solve the immediate app situation, but [we’re also] looking down the road."

Tyfone, of Portland, Ore., will develop and customize the mobile application for use by the credit union's 875,000 members, who can download it for free for iPhone and Android smartphones, Worthington says.

Financial institutions collect 3% of the mobile wallet's transaction revenue and split that revenue with Tyfone, Siva Narendra, Tyfone's CEO, tells PaymentsSource. Security Service Federal Credit Union is Tyfone's seventh credit union client, Narendra says.

The apps use Tyfone's u4ia mobile transaction software platform to let users check account summaries, transfer money between accounts, customize alerts, locate ATMs and branches, pay bills and use iCashe, Narendra says.

"Credit union members tend to be tech savvy," Christine Barry, a research director at Aite Group, tells PaymentsSource.

Smaller credit unions like to provide mobile services such as check capture because such offerings compensate for their limited number of branches, Barry says.

Explaining new tech "tends to be one of the big challenges any time a new technology is offered," she says, but "credit unions are well positioned to be able to provide that training and answer questions."

Of 83 credit unions Aite group surveyed last year, 57% considered offering mobile banking a high priority for the next two years. Another 19% said they would "probably" offer it in the next two years.

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