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CO-OP Financial Services Blog: Insight Vault

Is Debit Your Nerve Center?

General / by Manager, Public Relations and Corporate Communications

Is Debit Your Nerve Center?It’s easy to think of debit as basic. Everyone has it. Everyone uses it. Even as debit transaction growth has slowed a bit, growth is continuous. Yet, members aren’t swooning over debit. And chances are good, neither are you.

But it’s possible to think of debit in another way: as the nerve center of member activity and the central basis for a network of experience-enhancing products and services. Case in point: ELFCU in Indianapolis. ELFCU has over $1 billion in assets and no retail branches. For this credit union, maintaining member access across many channels isn’t a novelty: It’s a necessity.

“Checking accounts are the stickiest product we have, and engagement comes through debit and ATM transactions,” says Tim Greene, vice president of eCommerce at ELFCU. “At its core, access through debit is access to people’s money.”

Access may begin with debit, but it certainly doesn’t end there. Though ELFCU is an example of virtual relationship building, it faces many of the same challenges that all credit unions do. As transactions – and interactions – become increasingly remote, automated and electronic, meeting members’ needs and fulfilling their expectations requires a range of thoughtful products and services.

To that end, ELFCU wanted debit transactions to run flawlessly. But beyond that, they wanted a debit processor that could offer more – greater efficiencies, expanded member service options, everywhere access, state-of-the-art fraud protection, online and mobile enhancements and expert support. With signature and PIN debit processing at the center, ELFCU’s menu of CO-OP services is wide-ranging enough to meet evolving member needs. Services include:

  • CO-OP Network ATMs
  • CO-OP Shared Branching
  • ATM Managed Services
  • CO-OP Member Center
  • My Deposit Mobile
  • Terminal Driving
  • Full-Service Credit Processing

These services provide ELFCU members with many points of access, including ATM and shared branch locations and 24/7 telephone support. They also represent an unseen advantage:

By using multiple business lines, ELFCU enjoys relationship pricing and operational efficiencies – which translate into better rates and lower fees for members. ELFCU is also one of CO-OP’s credit union shareholders, which makes them eligible for an annual patronage opportunity.

If debit isn’t the newest or flashiest component in your member experience, remember that it may be one of the hardest working. You can view it as basic, or as the basis for a world of access.

Can You Build a Killer Card?

General / by Manager, Public Relations and Corporate Communications

Can You Build a Killer Card?Credit is back. The Fed’s most recent figures show consumer credit increasing by $19.6 billion in May – including $1.8 billion in revolving credit. Credit card growth spells opportunity for credit unions. But if you don’t currently issue credit cards – or your credit card offerings could use a boost – how feasible is it to build a killer credit card program yourself?

With the right help, you can.

Community Financial Credit Union in Broomfield, Colo., knew credit cards were a key need for members – and a valuable relationship builder for the credit union. Not only is every transaction a touchpoint, but servicing credit card accounts also provides Community Financial CU with the opportunity to connect, promote, serve and engage.

Using CO-OP in-house credit processing, Community Financial CU created card programs that fit their members’ needs: basic, low-interest cards for members who carry a balance, and generous rewards for members with multiple accounts and high aggregate balances. By choosing in-house processing the credit union has built a card program that is both efficient and personalized.

Of course, there’s more to a great card program than processing:

Fraud Prevention and Detection: Card security is a top concern. State of the art fraud prevention and detection are a marketing – and operational – essential.

Member Support: Members expect you to be on call whenever they need help. For many credit unions, outsourcing is the answer. CO-OP Member Center can provide telephone support for everything from account inquiries to fraud reporting and dispute resolution.

Analytics and more: Gathering and understanding data can help you pinpoint fraud, uncover member preferences, design targeted marketing campaigns, leverage your rewards program and more. Critical: Getting the help you need to analyze and organize data into meaningful information makes the difference.

Building a killer card program is part and parcel of creating a great member experience. When considering a new or retooled card campaign, also look at how your surrounding products and services can enhance usage – and usability. Do you offer the P2P capability that will help your credit cards power mobile payments? Are you considering card controls and alerts, which can make card accounts more secure and customizable? Credit cards may be a fundamental product, but their appeal doesn’t have to be strictly basic.

Of course, for full-service credit card transaction processing, CO-OP has the answer as well through its partnership with The Members Groups (TMG) of Des Moines, Iowa.

4 More Questions You Aren’t Asking About EMV

General / by Manager – Core Products

4 Questions You Aren’t Asking About EMVWe can finally say it’s a good time to start contemplating a shift to EMV for your debit cards. We can also say that thinking about a shift to EMV raises many questions for credit unions – including several you may not think of asking.

Last week we answered four questions you may not be considering when considering EMV. This week we tackle four more:

1. What operational challenges are we likely to be overlooking?

Because network and terminal issues will almost certainly arise, credit unions need to have a process in place for tracking transactions and how they route, then addressing and solving problems. Remember, this process is going to be critical for a good two or three years.

Also bear in mind that as the U.S. transitions to EMV, fraudsters will intensify their efforts on old technology. So, while you’re keeping an eye on new EMV-enabled transactions, expect to redouble fraud protection efforts on your non-EMV accounts and transactions, such as card-not-present or mag stripe transactions.

2. What do members really need to know about EMV?

Don’t expect members to know much. They’ve probably heard or read about EMV and look forward to enhanced security, but know little to nothing about how EMV works or what its security limitations are. On the other hand, members don’t need to know the intricacies – just the nuts and bolts.

As always, communication is in the details. Example: If you equip your ATMs with dip readers to accommodate EMV, you need to prepare ATM users for a different experience – one they’ll be having outside the presence of your staff (it’s an ATM, after all). If they aren’t aware that a new card reader will actually “hold on” to their cards, they may try to wrestle the cards out of the machine.

3. How important is it for us to have EMV cards in time for the liability shifts being enacted by MasterCard and Visa?

Of course you want to be mindful of liability, but the overall impact to your bottom line in the near term is probably small. Big box merchants will be ready for EMV in time for the liability shift, so regardless of whether your cards are mag stripe or EMV, you will retain the liability on those transactions. When you factor out those transactions, along with your card not present transactions, the pool of potential transactions where you might be able to shift liability is likely smaller than you think. It’s more important to focus on an EMV rollout strategy that makes sense for your credit union on the whole.

4. Can we just ignore EMV?

Theoretically, maybe; practically, no. Though there’s no reason to bolt or panic now, over time liability shifts will ultimately provide an ample motivation to switch. Also, as EMV becomes widespread, old technology will become the vulnerable target of fraud. You wouldn’t want that to happen to you.

Need to know more about debit and EMV? Join CO-OP for a live Q&A webinar, “EMV: Moving Forward on Debit,” with EMV expert Michelle Thornton: Thursday, July 31 at 2 p.m. Eastern/11 a.m. Pacific. Register now.

Top 5 Must-Reads for Credit Unions

General / by Senior Manager, Market Analysis

Top 5 Must-Reads for Credit UnionsThis month, Insight Vault has been looking at various ways that credit unions can power up on EMV, mobile wallets, real-time payments, new payment technology and member experience.  Here’s some additional food for thought from around the industry press:

Will Tokenization Eclipse EMV?

As credit unions prepare to take on EMV adoption, some wonder whether tokenization might replace EMV as the new security standard. This article is a good primer on tokenization, and how it intersects with EMV.

Is Real-Time Banking Fast Enough?

Just in time for CO-OP’s discussions about real-time payments this month, here’s an interesting take. Money can only move so fast, so this author argues that predicting your members’ future needs is the next logical step.

Visa Dumps the Digital Wallet Model

If the headline doesn’t say it all, consider this: “Visa is shifting away from pushing a consumer digital wallet product that promises to replace a physical wallet, and instead saying it is offering an easier way to spend money online.”

Wearable Payments Take the Stage in TMG Lab

Developments in the payments space may be complicated, but payment technology should be simple. So say the folks working on wearable payments innovations at The Members’ Group’s lab. Take a peek inside.

Smartphone Users Still Wedded to the Branch

Why invest in branch transformation? In a new Bank of America survey, almost half of U.S. smartphone users don’t think they’d last a day without their devices. Yet, 84 percent of respondents have visited a branch within the past six months.

‘Empowering People’ On-Stage and Beyond

General, Uncategorized / by Manager, Public Relations and Corporate Communications

‘Empowering People’ On-Stage and BeyondSince CO-OP Financial Services launched “Empowering People. Amplifying Dreams” at THINK 14, the great credit union story is being told to younger consumers from the concert stage, through social media channels and beyond. Here’s a campaign update!

Daria’s Hangiversary Concert

We hope you were able to attend the July 16 Daria Musk “Hangoutiversary” concert sponsored by CO-OP. If you missed it, we will be promoting five more in the coming months. And, you can also relive a portion of the powerful May 21 New Orleans House of Blues show here (as captured by Scott Patterson, Vice President of Analytics and New Business at Callahan & Associates).

Webinar Details Opportunities

Likewise, if you missed our July 10 webinar on how your credit union can get involved in the campaign, you can download a PDF or view the webinar via the (free) sign-in page here.

People Like You

A key campaign component is our website, www.co-opcreditunions.org, which is designed to tell consumers more about the advantages of credit union membership. The website focuses on the Millennial generation’s specific challenges and illustrates how credit unions provide the products and services that not only meet their challenges, but enhance their lives as a result.

We are building up quite a library of very personal stories of Gen Ys being helped in their life journey by credit unions. Visit People Like You to read six such testimonials, including three just added: Arianne Schumacher, Andrew Folkner and Kyle Coleman. More are in the pipleline!

Find a Credit Union

Of course, we make sure consumers can act immediately to find the credit union that is right for them – yours, for instance. A “Find a Credit Union” link is offered at both the top right and bottom left of the website home page.

You Tube, Twitter and Tumblr

We’re also building a library of videos to promote credit unions, featuring campaign spokesperson Daria Musk. The four videos can be found on our campaign You Tube channel.

“Innovative Banking” is also the theme of our content aggregation blogs at Twitter and Tumblr.

In the News

Daria Musk and two other “People Like You” (Dee Collier and Andrew Folkner) speak out in Credit Union Times on what they are looking for in their credit union.

Looking for some tips on how to attract young people to your credit union? A recent story in The Financial Brand spotlights three CO-OP client credit unions that are finding success – BECU, Georgia’s Own CU and Redwood CU.

CO-OP’s report on “Unlocking the Millennial Mystery” was also detailed last month in Credit Union Management magazine.

Our consumer outreach to Gen Ys specifically is giving us the opportunity to tell business publications about how credit unions can help small business owners as well. See the story in Entrepreneur.

Keeping up with the latest technology is essential for attracting younger consumers. What to do about digital wallets? CO-OP had the opportunity to write an OP-ED for Credit Union Times last week. Read it here.

We will continue to keep you updated on our progress.

4 Questions You Aren’t Asking About EMV

General / by Manager – Core Products

4 Questions You Aren’t Asking About EMVIt’s hard to have all the answers about EMV. In fact, sometimes it’s even hard to pose all the right questions. If you haven’t asked the following questions yet – or you haven’t asked them of the right people – here are four queries you might want to post:

1. Aren’t we EMV-ready for debit yet?

We’ve made tremendous progress: We’re nearly there. In fact, CO-OP Financial Services has the systems in place, and we’re helping clients kick off their planning in hopes that we’ll all be ready to roll out soon. Until all of the terminal issues have been resolved so that they work to your satisfaction, however, we think it’s better to go slow.

2. Will it kill us to move now?

No. But because critical terminal issues are still being hammered out, you run the risk of having transactions route in unexpected ways, possibly affecting your profitability. We also expect certifications costs to come down in the near future. Our advice is to wait until details are solidified – another six months to a year – for actual rollout.

3. Will EMV affect our debit-related revenue?

Quite possibly, yes – especially as terminal and network issues unfold. For example, suppose you issue a Visa debit card now, with the Visa common AID. A card is used with a PIN at a terminal that is enabled for EMV, but doesn’t yet have the logic to choose the common AID. That transaction will be routed to Visa, as a PAVD transaction, and not a regional network. This could affect your revenue/expense on that transaction.

4. How long will it take for network and terminal “issues” to resolve?

Industry insiders say to expect some disruption for two or three years. As networks and endpoints work to complete certification, some transactions may not be able to be completed as expected. The industry is testing for 90 percent of the possible scenarios, but with multiple changing players involved in every transaction, it is expected that during this transition period that there will be some bumps. Hang on.

Need to know more about debit and EMV? Join CO-OP for a live Q&A webinar, “EMV: Moving Forward on Debit,” with EMV expert Michelle Thornton: Thursday, July 31 at 2 p.m. Eastern/11 a.m. Pacific. Register now.

Look for more questions and answers about EMV next week on Insight Vault.

Cards With Benefits: Are You Keeping Them Secret?

General / by Vice President, Credit Issuer Processing

Cards With Benefits: Are You Keeping Them Secret?Card benefits may be one of today’s best-kept secrets with cardholders, and even some card issuers are unaware of the benefits automatically provided on MasterCard and Visa card accounts. Consumers are hyper-aware of data breaches and the concern about card safety has recently escalated. It is important to educate yourself as well as remind your members that credit and debit cards offer valuable protection services, and that their credit union has international brand support behind the cards they issue.

Fraud Protection and Cardholder Support

All MasterCard and Visa credit and debit cards provide zero liability to cardholders, as long as the cardholder exercises reasonable care in safeguarding their card and remains in good standing. All issuers are required to provide 24/7 cardholder servicing via telephone for lost and stolen card reporting, emergency card replacement and cash advance services.

Circumstances that make these services valuable are never planned, but when the credit union is the source of support and good news, a bad situation can end up being a great relationship builder between members and their credit unions. While card users should use their cards responsibly by keeping track of their card and the purchases made with it, using a credit or debit card is the most convenient and safe means for making everyday payment transactions.

Benefit Enhancements

Over the last year, MasterCard and Visa have enhanced benefits for all cards, improving consumer appeal.

Now, all MasterCard Credit product types are automatically provided with these core MasterCard-funded benefits: price protection, extended warranty and identity theft resolution services with wallet protection.

MasterCard Enhanced Debit cards also have added core MasterCard-funded benefits, including price protection, extended warranty and satisfaction guarantee.

All Visa Credit consumer product types are automatically enrolled in Visa-funded auto rental collision damage waiver insurance. This is an extremely convenient and valuable benefit to members who travel and rent cars, saving them dollars per day.

Do Your Members Know?

Certain disclosures must be provided to cardholders, and CO-OP Financial Services can help you with that process. Be sure to frequently remind your cardholders that the cards you issue have these benefits. Marketing messages on statements, websites and other printed materials will encourage your members to reach for their credit union card for payment and peace of mind.

For Your Consideration

To differentiate your card program and make it more appealing to a particular consumer segment, you may want to convert your standard MasterCard Debit cardholders to Enhanced Debit (there is no need to reissue cards or account numbers!) and also consider adding customized benefits related to retail shopping value or travel.

Many benefits are available for your selection from MasterCard and Visa, and CO-OP can help you evaluate benefits and pricing, as well as support you with enrollment and cardholder notification. Ask your CO-OP representative for more details.

CO-OP, TMG Marking Partnership Milestones

General / by President/CEO

CO-OP, TMG Marking Partnership MilestonesToday is the first full day of programming for the 2014 TMG Executive Summit, which runs through tomorrow in Lake Tahoe, Calif.

Last night I had the opportunity to make some opening remarks during the conference’s Welcome reception. Now is a good time to reflect on the two and one-half years since we invested in The Members Group and formed our “Leaders in Innovation” strategic relationship.

This partnership combines the strengths of the two companies to deliver the industry’s largest array of cutting-edge payment solutions for credit unions, full-service credit processing chief among them. Together, CO-OP and TMG service about half of all credit unions in the United States.

We inaugurated the partnership in January 2012, and it was a natural fit:

  • Both companies are credit union–owned;
  • Both conduct business with the same people-helping people philosophy of the credit union movement; and
  • We share the same perspectives on how to service and create long-term relationships with clients.

The CO-OP-TMG partnership has led to contract wins with two of the top 10 credit card-issuing credit unions in the U.S., along with many other new agreements in the past 12 months.

Since the formation of the partnership, we have been able to offer the credit union movement:

  • Full-service credit card processing via TMG.
  • Springboard integration that allows full-service credit union clients of both CO-OP and TMG to have a single point of access to credit and debit reports, and a single view into credit and debit programs.
  • In-house credit card processing using CO-OP’s debit rails.

With our partnership with TMG, CO-OP is truly the one-stop shop for credit union credit and debit processing. We are able to provide credit unions with a single point of entry to the most innovative, tailored, cost-effective products and services. Combined, both companies offer the best processing platform for each client’s unique needs. And, we provide a scale of processing that is second to none.

We certainly look forward to working with TMG and all our client credit unions to offer their members the most advanced and convenient-to-use services of any financial institution.

Top 10 Must Reads from CO-OP

General / by Manager, Public Relations and Corporate Communications

710Reads CO-OP Financial Services is making news – from new business partnerships to outreach to Gen Y consumers – and offering its perspective in the pages of trade journals on leading industry issues. Here’s a recent “Top 10” of articles that have included CO-OP in their coverage.

WVLSC, CO-OP Enter ATM Network Partnering Agreement (ATM Marketplace, June 26, 2014)

A Remote for Your Mobile Payment App (Transaction World Magazine, July 2014)

Member Business Banking and Shared Branches (CUES Sky Box, June 30, 2014)

Juggling Delivery Strategies (Credit Union Management Magazine, July 2014)

CO-OP Study Focuses on ‘Unlocking the Millennial Mystery’ (Credit Union Management, June 24, 2014)

Ferraro Now CO-OP Chairman (Credit Union Times, June 13, 2014)

Elevations Credit Union Enhances Service With New ATM (Credit Union Management Magazine, June 16, 2014)

CO-OP Partners With SFS in Kansas (CUNA News Now, June 19, 2014)

Financial Technologies Evolve and Advance (Credit Union Management, June 10, 2014)

Gen Y Success (Credit Union Management Magazine, June 6, 2014)

Is Your Member Experience Giving Them Life?

General / by Vice President, Marketing

Is Your Member Experience Giving Them Life?How do members experience your credit union in real life?

Here’s a video showing a day in the life of Rick, a fictional credit union member, whose credit union provides the access he needs to pay bills and friends on the fly, do transactions via shared branching and ATM, handle remote deposits and card security, and even flash a photo of his beloved pup when he pays by credit card. Like the millions of members who actually use CO-OP technology and services, Rick isn’t visiting his credit union only at the branch. He’s engaging with his credit union throughout the day, every day.

When you take a moment to visualize your credit union’s member experience as it really plays out, it’s possible to see both the challenge and the opportunity. Once upon a time, offering a pleasant, personalized branch experience was everything. Now you must connect at multiple points – and the quality of those connections equals your experience.

For the team at CO-OP Financial Services, building and improving those connections has become a near obsession, and for one good reason. When you look at a day in the life of your typical member, you should see clearly all the ways your credit union’s technology and services are making it a very good day.