LAS VEGAS—CU Wallet, the credit union-owned digital wallet solution, announced at the Money2020 conference it has contracted with Massachusetts-based mobile wallet developer Paydiant.
The Paydiant tools that will power CU Wallet will be provided in white label form, which means the Paydiant brand is invisible. Paydiant is currently used by Barclays Bank and Paydiant co-founder Chris Gardner said in an interview on the conference’s exhibit floor that Bank of America is conducting a trial of his company’s services.
The driving idea behind CU Wallet, which was founded by digital banking pioneer Paul Fiore and Ongoing Operations CEO Kirk Drake, is to provide credit unions with a state-of-the-art mobile commerce tool that will enable retail point of sale transactions. More than 20 credit unions have also signed on with the expressed intent of creating a CUSO to support the effort.
Paydiant also recently announced a deal with the Subway restaurant chain, which has 40,000+ locations, where its tools will be built into the Subway mobile app.
Fiore said in an interview at the event that Paydiant will enable CU Wallet to speed up its introduction to members. He estimated the initial credit union rollouts will occur by the end of the year, three months sooner than he had previously stated.
Gardner said another key advantage of Paydiant is that its tools have been developed to work with existing retail infrastructures and cellphones.
“There is no need to buy new hardware to use the Paydiant wallet,” he said.
Fiore stressed that credit unions will control CU Wallet, including majority ownership.
CU Wallet is still looking for founding credit union owners, he said. The present group of interested parties ranges in size from credit unions with fewer than $100 million in assets to the $6 billion San Diego County Credit Union.
Credit unions that have already signed on to CU Wallet represent 2.8 million members, Fiore said. With as few as 10 million members, CU Wallet would have ample bulk to be of considerable interest to potential retail outlets, he added.
Going forward, Fiore said CU Wallet will focus on developing unique rewards, offers and discounts at participating retailers. CU Wallet is investigating additional enhancements to its payments tools, but Fiore said building in person-to-person payment tools is not a current priority.
Credit unions that have agreed to participate in CU Wallet include $747 million Quorum Credit Union in Purchase, N.Y.; the $2.29 billion Affinity Federal Credit Union in Basking Ridge, N.J.; the $979 million Workers’ Credit Union in Fitchburg, Mass.; the $1.45 billion Arizona State Credit Union in Phoenix; $1.6 billion University Federal Credit Union in Austin, Texas; the $3.2 billion Kinecta Federal Credit Union in Manhattan Beach, Calif.; the $1.8 billion Washington State Employees Credit Union in Olympia, Wash.; the $2.5 billion Northwest Federal Credit Union in Herndon, Va.; the $3.5 billion DFCU Financial in Dearborn, Mich.; the $398 million City & County Credit Union in St. Paul, Minn.; the $870 million TwinStar Federal Credit Union in Lacey, Wash.; $697 million One Nevada in Las Vegas; and, the $5 billion Digital Federal Credit Union in Marlborough, Mass.