LIVONIA, Mich.–CU Solutions Group (CUSG) said it has entered into a definitive agreement to acquire 60% of CU Wallet, LLC for a five-year, $3-million working capital loan and a $3-million exchange of CUSG stock with existing CU Wallet “Class A” shareholders.
CU Solutions Group said the acquisition accelerates its efforts to be an active provider of technology solutions and enhance its services and mobile development efforts for the benefit of credit unions.
“CU Wallet’s proven expertise in developing mobile platforms will support CU Solutions Group’s work to bring new, innovative and secure solutions to market,” CUSG said in a statement. “It will allow CU Solutions Group to play a more strategic role in the evolving US mobile payments ecosystem, by leveraging CU Wallet’s innovative shopping and payments platform, industry expertise and strategic partnerships.”
In a statement, Dave Adams, CEO of CU Solutions Group, said, “CU Solutions Group sees great synergy with the CU Wallet vision. We are interested in offering credit unions an array of mobile lifestyle apps that include a shopping/payments app such as CU Wallet. CU Solutions Group is committed to bringing great technology solutions to a wide group of credit unions not just the very largest. The goal is obviously to help credit unions maintain card interchange income and add value to their card offerings in a very dynamic payments space. We also see an opportunity to help fund and build upon the creative energy that Paul Fiore and his team bring to this technology. We look forward to this alliance that will help us with these objectives."
Los Angeles-based CU Wallet was founded in 2013 to meet the needs of credit unions’ increasingly mobile membership. Its on-device application and back-end infrastructure enables credit union members to simply and safely make mobile purchases with any payment card on any device across multiple communications technologies, providing an easier way to pay and a more seamless, end-to-end consumer experience, the company said.
Among its offerings:
- CU Wallet Application – a custom branded app for a financial institution that may be deployed as a stand-alone app (independent of the institution’s mobile banking product) or integrated with select mobile banking apps, and includes the following wallet features: coupon offers, card-linked offers, in-store payments, merchant directory.
- Remote ATM Withdrawal – a custom branded application for a financial institution that provides the ability to add an ATM card to the wallet and make ATM withdrawals at institution owned machines using the app, without the need to insert the debit card into the machine.
The company said two more applications will be announced in 2017.
“Today’s announcement represents a significant milestone in our company’s history and our team is thrilled to work together with CU Solutions Group to deliver innovative mobile solutions for credit unions,” said Paul Fiore, CU Wallet’s chief executive officer and founder, in a statement. “Like CU Wallet, CUSG is a credit union service organization, so this partnership furthers our aligned mission to provide credit unions with innovative technology that’s 100% driven by a team charged with serving their unique interests. The CU Wallet white label application that’s in market today offers credit union members a secure, compelling and convenient digital shopping experience, making it an ideal complement to CU Solution Group’s already robust suite of product and service offerings,”
CU Solutions Group and CU Wallet expect to finalize the arrangement in the first quarter of 2017. The transaction is subject to customary closing conditions.