Mature and legacy payments systems still have lots of potential.
When we think of payments today, we often think about mobile and relatively new offerings like Apple Pay, Venmo and maybe even remote deposit capture.
But when I attended the first virtual class of CUES’ new Payments University last Tuesday, presenters Terence Roche and Michelle Shoop focused on credit and debit cards, bill-pay, recurring ACH and wires. Why? Because a large portion of credit unions’ payments revenue comes from such established products.
Fortunately for credit unions’ bottom lines, the pair’s forecast for these revenue-generating systems—if well-managed—is sunny.
Principal with CUES Supplier member and strategic provider of technology and risk services Cornerstone Advisors, Scottsdale, Ariz., Roche cited 2015 statistics from Nilson that projected growth in mature and legacy payments systems that has aligned closely with actual volumes to date. And the data project continued growth through 2019.
“A lot of your revenue is coming from areas of growth,” Roche said. “That’s the good news and we are encouraged by that.”
Another element of the sunny forecast for mature systems is that while disruptors are present, they haven’t yet pushed out the products that are producing so much revenue for credit unions.
“The disruption they’re causing is minimal,” said Shoop, a director with Cornerstone Advisors, showing a slide that detailed industry newcomers, including some that have already been shuttered. “They’re really not having a major impact at this time.”
Roche said success will come from knowing how to manage products along the maturity spectrum. Managers at credit unions need to know what to do with declining systems like checks, mature ones like cards, growing ones like Apple Pay, and research and development ones like blockchain.
Roche and Shoop outlined several tactics for managing credit unions’ current payments scenario, including a chart for mapping accountability for payments across the organization. They also identified some special opportunities for credit unions, such as offering credit cards to affluent and business members. “There’s a business here,” Roche said. “You can go get it.”
Lisa Hochgraf is CUES’ senior editor.
Register for Payments University to get the playback of this session, attend the second virtual session on March 28, and join the in-person program April 3-4 in San Francisco. The virtual sessions leverage CUES’ new Elite Access™ Virtual Classroom technology, which allows virtual breakout sessions, live presenters and two-way learning.
Read a CUES Skybox post about other presenters at Payments University.
Also read “Case Study: Boosting a Stagnant Card Program” from CUES’ Credit Union Management magazine.