LAS VEGAS — Young people don't want checkbooks, and it's areality that some credit unions may be ignoring.

Michael Kelly, president/CEO of payments CUSO PSCU in St. Petersburg, Fla., shared that message during aThursday guest speaker luncheon at NACUSO's annual conference atthe Encore Las Vegas.

“There are still way too many financial institutions issuingchecks. We say 'we're worried about you,'” Kelly said.

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Cash may still be king leading the pact over credit cards, debitcards and checks, Kelly said citing industry data, but with mobiletransactions expected to replace cash and cards by 2015, creditunions can't afford to sit on the sidelines.

In 2010, mobile payments totaled $5 billion, Kelly said. In2015, that figure is set to soar to $119 billion given that moreAmericans have smartphones and with the continued growth of mobilecommerce and remote payments.

“Mobile is a super channel,” Kelly said.

With innovations like Bitcoins, a form of virtual currency, andmore merchant partnerships being formed such as between Square andStarbucks and PayPal and Home Depot, Kelly said there areopportunities for credit unions to be players as well.

PSCU is currently working with several credit unions on aGoogle Wallet project, Kelly said. He mentioned the $1.2billion Lake Trust Federal Credit Union in Lansing, Mich., being thefirst credit union to launch MasterPass, a digital service thatallows consumers to use any payment card or enabled device to shop.Mobile subscribers are up by 28% at the $1.5 billion GTE Financial in Tampa, Fla., he added.

“There are credit unions attacking each other and stealingmembers. I say 'people we have 6% of the marketplace.' If we loseour core competency, it will be a long road to hoe,” Kellysaid.

He acknowledged that some credit unions feel they can't makethis shift to mobile. Collaboration with CUSOs can help with thetransition. Overhauling or upgrading a current card program may bea good entry point as well.

“The thing is some credit unions will spend $3 million for abranch but not on a virtual space,” Kelly said. “Credit unions haveto be in the game.”