Mobile payments are about to get a serious toe-hold in the US. In case you haven’t heard, Google is about to release the newest version of Android, Gingerbread, which will support NFC. Once Apple releases their next iPhone in 2011, you can expect adoption to increase exponentially.
So what does this mean to banks and credit unions? Most won’t be affected for a while. But the big boys like Bank of America, Wells Fargo, Citibank and JP Morgan will really start to feel the pain sooner rather than later. Mobile payments will allow users to connect their credit and debit cards to their phone. But that’s only if Google and Apple decide to play nice. They could set themselves up like PayPal, which means that everything would flow through ACH. If that happens, you can kiss interchange fees goodbye. The bigger banks would feel this first because their customers are among the early adopters.
Now, you can stick your head in the sand and hope that adoption doesn’t happen for another 10 years, or you can start planning your strategy today. One thing I’d look at is charging a fee for any ACH withdrawal. The second is getting familiar with iOS and Android. Because if you aren’t planning to adapt, others are.