Members who use online banking are likely to embrace mobile banking.
That’s what Veridian Credit Union, Waterloo, Iowa, found after it introduced mobile banking in August 2010. About 70% of the $1.7 billion asset credit union’s 153,000 members use home banking. They conducted 1.4 million online banking transactions in 2010.
This high rate of online banking adoption helped attract 6,000 mobile banking users within the first five months of launch, says Brett Engstrom, manager of web services.
Veridian’s mobile banking service offers both text/SMS banking and mobile web access, which means it’s accessible even if members lack a smart phone or a data plan. Members aren’t required to enroll in online banking to use mobile services.
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Engstrom says Veridian plans to add person-to-person (P2P) transactions this year so members can transfer funds to others based only on the recipient’s e-mail address.
Veridian serves as the depository financial institution for credit union funds transferred via P2P transactions handled through the partnership. Participating credit unions, however, can choose a “branded” option that allows them to hold their own funds.
Mobile to-do list
Mobile banking experts interviewed by Credit Union Magazine advise taking these steps when introducing mobile banking services:
- Decide when and how to offer mobile banking in 2011. Industry analysts say this is the year mobile banking goes mainstream. Go live by year-end if possible.
- Use mobile banking as a strategy to acquire members. Consumers will be more inclined to join credit unions as banks continue to add and increase fees.
- Offer mobile remote deposit capture (RDC) as a value-added service to attract consumers from other financial institutions.
- Explore applications for business members, including mobile RDC and mobile transactions, so they can manage company finances remotely.
- Select a vendor with the right combination of functionality, fees, integration, launch timeline, and references. Create a fee schedule that separates mobile banking and online banking to reduce costs for serving young, mobile-only members.
- Consider mobile RDC’s potential to decrease branch traffic, making it possible to trim branch size and reallocate staff.
- Wait to adopt “contactless” functionality until merchant acceptance grows and a clear winner emerges among options to “tap” or “wave” the cell phone on or near devices to pay for low-value purchases.