It wasn’t some sexy fintech start-up that won NACHA’s 2018 Judges’ Choice award. It was, of all things, a credit union.
Redwood Credit Union’s RCUpay, a mobile-first solution providing members with the ability to send money to anyone in the U.S. by text or email, took home the Electronic Payment Association’s top honor and is looking to keep building on its success.
“Our team is excited for the future of RCUpay. We’ve only just begun in terms of functionality and experience,” said Redwood CU’s Senior Vice President of Payments Todd Lindemann. Aside from bragging rights, the prize also includes $15,000.
“We’ll continue to develop the application by working closely with our members to learn about how they’re currently using RCUpay and to get their wish list of future features,” said Lindemann.
NACHA (formerly the National Automated Clearing House Association) is tasked with managing the development, administration and governance of the ACH Network.
“The NACHA Payments Awards are very competitive and each award draws an excellent turnout of candidates every year,” noted Jane Larimer, chief operating officer of NACHA. “We appreciate the participation from solution providers, financial institutions and industry strategic thinkers, all of whom have found innovative ways to further advance electronic payments.”
When RCUpay was rolled out in April 2017 .49 percent of the Redwood CU’s 90,672 mobile members were using the app. As of May 2018 that number climbed to 6.8 percent. From January 2018 to May 2018, Lindemann explained that there has been a 95 percent completion rate for all P2P transactions. During the first quarter, there were a total of 7,484 transactions with 5,100 routing as real-time on-us transfers and 2,384 routing through same-day ACH.
“We anticipated the solution would be adopted by younger members, but the data is showing adoption ranging from millennials to baby boomers, with our largest user base in the 30 to 44 age range,” said Lindemann. “Some anecdotal evidence points to members trusting RCU as their primary financial provider and not wanting to share their financial data with Venmo, Facebook or Google.”
Fiserv recognized for payments excellence
The $4.3 billion, Santa Rosa, Calif.-based Redwood CU, which supports over 240,000 members, wasn’t the only award winner familiar to credit unions at this year’s NACHA conference. Fiserv took home an excellence in payments award for its Digital Payments Software Development Kit (SDK) and Digital Disbursements products.
Fiserv’s SVP of Product Management & Strategy, Electronic Payments Whitney Stewart Russell explained these new solutions are an outgrowth of existing technologies that were tailored for business-to-business, consumer-to-business and business-to-consumer payment platforms.
“We took our payments, fraud and risk capabilities and created a better, lower-cost way to move money,” said Stewart Russell. “We have great lineage and experience in moving money and creating payments solutions within a financial institution ecosystem and we thought there was a real opportunity to take some of those capabilities and advance them for corporates or smaller businesses.”
While Fiserv has not yet worked with a credit union on its latest product offerings, which are just nine months old, credit unions are expressing interest.
“We have some larger credit unions looking at providing the digital disbursement product to businesses they support, and we are seeing more and more credit unions getting into the commercial or corporate side of the equation,” she said.
Not content to rest on their laurels, both award winners took the opportunity to learn more about where the next big thing might come from, and the hot topic, they said, was real-time payments.
“Supporting RTP will be critical in the next 18 months,” said Lindemann. “There will be opportunities to transcend P2P, especially in supporting B2B payments or automating disbursements, such as payroll.”
Lindemann added there were also discussions regarding The Federal Reserve exploring a solution for real-time payments. “Many issuers I spoke with found that valuable as a method to compete with Zelle, which, outside of ACH and soon TCH, doesn’t leave many options for routing payments,” he said.