Nusenda introduces ‘contactless’ card
New Mexico’s largest credit union introduced a new way for its members to pay for goods and services, one that may become a model for other financial institutions in the state.
Nusenda Credit Union in May became the first local credit union operating in New Mexico to offer ‘contactless’ credit cards to its roughly 40,000 cardholders. JJ Alcantar, vice president of card services for Nusenda, said cards use technology that allows users to avoid swiping or inserting their credit cards, which he said not only saves time but also makes transactions more secure.
Contactless credit cards containing a computer chip have been gaining momentum nationwide, as the number of companies using terminals where cards can be tapped has risen. A June report from the U.S. Payments Forum notes that more than 60% of face-toface Visa transactions occur at contactless-enabled merchants as of the end of last year, and the number is expected to rise.
While large banks like Wells Fargo and Bank of America debuted contactless cards in the last several years, local or regional credit unions with a presence in New Mexico have largely stayed out of the fray, said Tom Hagan, chief risk and administrative officer for Nusenda.
There was a sense that new phone applications that allow users to pay, including Apple Pay and Android Pay, might leapfrog credit card technology, he said. So far, however, that hasn’t happened.
“People are still conditioned to be using their cards,” Hagan said.
High-profile data breaches at companies like Target have helped move contactless technology into the mainstream as well, Hagan said. He said contactless card transfers transmit less personal data than swiping your card, meaning that it’s easier to keep customer data safe.
“We heard from a lot of members who said ‘I don’t want to have to have my card re-issued every six months,’” he said. “This really helps answer that question.”
Alcantar said there’s still some discrepancies to where customers can use the feature. He said big-box stores have been quicker to adopt the technology than small businesses, but noted that individual stores may take longer to incorporate the technology. Customers with contactless credit cards can still insert or swipe their cards at stores that don’t have the technology in place.
So far, Alcantar and Hagan said the feedback they’ve received on the cards has been positive. They noted that the program is for Nusenda credit card-holders only, though they added that the credit union is looking to add a debit card version as well, potentially as soon as this winter.
“It’s definitely in our roadmap,” Alcantar said.