DES MOINES, Iowa/RANCHO CUCAMONGA, Calif.-In a move that seeks to create the largest payments solutions provider within credit unions, The Members Group (TMG) and CO-OP Financial Services said today they have entered into a strategic partnership.
Together the two companies serve more than 40% of all U.S. credit unions and provide payment services to nearly 33 million cardholders.
The agreement follows CO-OP Financial Services recent acquisition of U.S. Central Bridge Corporate's online and mobile bill pay business after NCUA could not to find a buyer for the failed corporate's payments operations. Those operations are now being wound down as other providers seek to offer alternatives.
CO-OP President and CEO Stan Hollen said the arrangement is not aimed at gathering more business from the corporates, but instead is focused on providing better service to natural-person credit unions.
"This is really about the coming together of two credit union-owned payments organizations that will put together the best processing platform for each natural-person credit union's unique needs."
The agreement, too, gives the new entity greater scale to improve efficiencies in both services delivery and technology development, added Shazia Manus, CEO of TMG, in an interview with Credit Union Journal. "This is a pivotal time for credit unions."
The larger array of payments offerings will also allow CUs to bundle more services, which could lead to savings for credit unions, added Hollen.
Under the agreement, CO-OP has made an investment in TMG, but both companies will continue to offer products under their own brands, operate independently, and work within their existing management structures. Both companies announced they will cross-sell all of their respective products and services. Together, TMG and CO-OP provide core payment products, including full-service credit, debit, ATM, prepaid products and P2P payment solutions.
