At Golden 1 Credit Union, consumers' habit of favoring debit cards over cash created an opportunity to promote mobile payments—with an added lure of integrating other mobile services.
"With the increased use of debit cards, consumers have less cash with them, so this provides the ability to provide person-to-person payments directly to a person that you want to pay rather than through a vendor or with a check," says Donna Bland, president and CEO of Golden 1 Credit Union, an $8 billion-asset Sacramento-based credit union that has about 625,000 members.
Golden 1 is using newly integrated tech from Fiserv—the tech vendor recently combined its Popmoney person-to-person service with its Mobiliti mobile banking and payments technology. The system allows people to use an email address or mobile phone number to initiate the transaction.
In addition, "the members have a one-stop location where they can go into a mobile app and see their account information and make a payment transaction with the phone," Bland says.
The credit union already offered some connection in the past between person-to-person payments and mobile banking, but it required the use of Web content on the mobile screen. This practice provided a poor navigation experience, Bland says.
Golden 1 uses Fiserv for most of its mobile financial services, and also offers mobile account transfers, mobile remote deposit capture and electronic bill payments. The credit union also hopes to add other financial serves to the mobile person-to-person integration, but thus far has been reluctant to offer a full mobile wallet due to security concerns. "At some point in the future we will, but it's still early-stage at this point," Bland says.
Fiserv has about 600 clients live with the integrated offering and is working with several hundred additional clients on deployment. For new institutional users, the combo is plug-and-play. "It's fully integrated out of the box," says Steve Shaw, vice president of strategic marketing for digital channels and electronic payments for Fiserv.
While not disclosing a firm deployment calendar, Fiserv plans to integrate other mobile services to mobile payments over time, such as personal financial management.
"This [person to person integration] is a phase of bringing in many types of information and money movement capabilities into the digital experience as we can," Shaw says.
Fiserv's broad tech bench to pull off these integrations has come via a series of acquisitions—including mobile banking provider mCom, payments provider CheckFree and Popmoney's developer, CashEdge.
These purchases give Fiserv direct oversight over development and quality control, Shaw contends. "We can certify that we have the right tech and the right people in place," Shaw says.
As a number of emerging payment companies turn to sharing and third party developers to build out their offerings, larger tech companies are well-positioned to acquire these products after they have been tested in the market.
"In some ways you could look at this as a cycle rather than a trend. Larger firms open up and allow smaller innovative firms to test out new products and solutions," says Rick Oglesby, a senior analyst with Aite Group. "When these new products or solutions stick, the larger firms can buy them up and use them to increase their own offerings. Those that don't stick fall by the wayside and the larger firms haven't had to suffer the losses associated with that."
Among Fiserv's rivals, Jack Henry is also developing new person-to-person capabilities for mobile devices. The core banking vendor offers mobile banking and payments in part through its GoDough mobile technology.
"Mobile devices are much more accessible and easier to carry around," says Greg Adelson, group president at Profitstars, a unit of Jack Henry that specializes in financial services software in areas such as mobile and imaging and payments processing technology.