Disenchanted bank customers may be attracted to the idea of switching to credit unions, but in the smartphone age many have become addicted to the mobile offering of the banks provide. A new venture announced on September 23 aims to change that: CU Wallet, a mobile wallet for credit unions.

It’s hoped  that CU Wallet will help credit unions fend off member erosion with snappy technology and supplement declining fees with increased revenue from marketing and offers within the wallet environment.

The service is still being developed and is expected to launch in pilot mode in Q1 2014. 15 credit unions have so far signed on under the leadership of Paul Fiore, co-founder of Digital Insight, and Paul Parrish, CFO of One Nevada Credit Union. Fiore sits on the boards of restaurant payment app TabbedOut (where he was once CEO), and Doublebeam, a new mobile venture for whitelabelling by merchants that rides check rails to avoid card interchange fees.

One Nevada CU is based in Las Vegas and has assets of around $700 million.

“Credit unions want one mobile app, their own branded app,” Fiore told Bank Innovation. Important features of the app will include mobile cash access, gift cards, bill pay functionality, offers and rewards and, most importantly for a mobile wallet, full transaction settlement at the point of sale from the credit union. Credit unions that issue the wallet can choose to turn features on or off as they choose.

The whitelabel FI partner underpinning the wallet has yet to be announced but will be soon, according to Fiore. The idea will be to leverage existing technologies rather than spend time and money developing the wallet from scratch. This will help bring the wallet to market more quickly, Fiore said.

Are credit union customers clamoring for a digital wallet? In answer to his, Fiore pointed to his Digital Insight experience. “Not one person had used online banking, but adoption went from zero to critical mass very quickly.” It will be the same with mobile wallets –“Available and valuable, ubiquitous and simple,” Fiore said. “Digital wallets are are safer than cards in terms of preventing fraud ad identity theft, and provide more revenue opportunities.”

Navy Federal, the nation’s largest credit union with 4.4 million members, recently announced it would offer Visa’s V.Me wallet to its members. A recent Javelin study showed mobile wallet use on the rise, with 21% of smartphone owners using a mobile wallet such as Google Wallet of Apple’s Passbook within the last 90 days.

An important goal of CU Wallet is to keep the credit unions in control of the payment process and the member experience and, crucially, the data. There is no carrier involvement in the data, according to Fiore. The number of institutions and users of the wallet will increase its bartering power in terms of deals and partnerships as well.

With 15 credit unions aboard, what will define success for CU Wallet? By the end of the year, Fiore hopes to have 66 to 100 credit unions signed up. There are about 100 million members of credit unions in the United States.

Paul Parrish of One Nevada said, “The payments arena is a big mess. There’s resistance to NFC and EMV. And the three components, there are threats from Visa and MasterCard, FIs are whining, merchants are pushing back. It’s a question of who will do what when? The technology is there. We have the opportunity to develop this and do it right.”