In recent years, digital wallets have evolved from a nice-to-have offering to an essential product credit union members expect from their financial institution. This shift raises important questions for credit unions, like how they can adapt and continue fostering strong member relationships.
Digital wallet usage
According to Velera’s 2024 Eye on Payments consumer research study, the number of members using digital wallets at least a few times per week has grown by 11 percentage points since 2023. In fact, half of credit union members (50%) report using a digital wallet at least a few times per month, a significant increase from 34% in 2023 and 27% in 2022. Additionally, the percentage of members who never use digital wallets has dropped from 57% in 2022 to 35% in 2024.
Further, 31% of credit union members reported using a digital wallet at a point of sale in the past 60 days, while nearly 59% expected to use one in the next six months. This likelihood nearly doubled compared to 2022, when only 35% anticipated digital wallet usage within the next six months. At least a quarter of credit union members feel digital wallets are easy to use (32%), convenient (28%) and allow for fast transactions (26%). Not surprisingly, younger consumers are the most frequent users of digital wallets.
Addressing member expectations
Visa projects that digital wallet transaction volume will increase from 752 billion in 2023 to 1.4 trillion by 2028. Credit unions that have not yet added digital wallets to their toolbox must act quickly to stay competitive and give members the flexibility to transact how and when they want.
The first step is to map out the member journey and identify opportunities for digital wallet adoption. After defining use cases, credit unions should evaluate existing digital channels and determine whether enhancements are needed. There are a number of ways to connect digitally with members including websites, apps, chat functions, contact centers, AI solutions and more. How can these be leveraged to launch or enhance digital wallet capabilities? Once the journey is mapped, processors, core providers and online banking vendors can be brought into the process.
One major challenge is pinpointing members who are most likely to adopt digital wallets and determining the best communication channels to reach them. Which members are already engaged in one or more digital services? Which members prefer mobile banking over in-branch visits? These digitally inclined users—most likely younger consumers—represent the easiest segment to target for digital wallet adoption.
Whether introducing digital wallets for the first time or enhancing an existing offering, credit unions must highlight the benefits for members. Features like ease of use, convenience and speed have driven the popularity of almost all modern payment methods, a trend Velera has tracked in Eye on Payments since its inception, and this looks to hold true for digital wallet adoption and usage. Ensure members are aware that your credit union supports digital wallets and encourage them to add their credit union-issued cards to these platforms, with the goal of empowering members with seamless, secure transaction capabilities that keep them engaged with your credit union.
