WASHINGTON - The advent of debit cards was a major theme of the national bank card conference here this week.
Visa U.S.A. used the American Bankers Association gathering to unveil to the national press a Gallup poll indicating public yearning for debit cards, and to kick off a national marketing and consumer education campaign for its debit products.
Also at the conference, MasterCard International announced a marketing alliance with First Data Resources, the Omaha-based third-party processor, to expand the association's global debit programs.
The initiative will promote automated teller machine, online, and off-line point of sale debit issuance. First Data had previously announced a similar arrangement with Visa U.S.A.
|The Biggest Single Challenge'
Separately, convention delegates were offered an array of expert talks on everything from debit technology to debit marketing strategies.
"Debit is the biggest single challenge" on the Visa agenda for the next year, said Welsey C. Tallman, executive vice president of market and product development.
Now that the consumer market is approaching the saturation point in terms of cards issued, Mr. Tallman said debit cards are a way to increase transaction volume.
Some bankers said they were skeptical of the potential of a debit card industry, which has been in the making for two decades. Indeed, Visa, which has abandoned the use of the word "debit" in its promotions because consumers balk at the concept, acknowledged to an official of the U.S. Mint at its press conference that debit cards probably weren't going to put his agency out of business.
But Carl F. Pascarella, president and chief executive officer of Visa U S A. said consumers accustomed to automated teller machines would warm quickly to the idea of checking account access cards that can be used for purchases as well as cash withdrawals.
Mr. Tallman argued that progress in automation of payments through Visa's Payment Service 2000 program would hasten the development of the market.
The Gallup poll indicated consumers are eager for a safer alternative to cash. But Visa officials found themselves fending off questions from reporters concerning the safety of the debit cards.
Some consumer advocates have warned that rules governing lost or stolen debit cards, as deposit products, are less favorable than the rules governing credit cards.
If a consumer fails to report a lost card within two days, he or she could be liable for up to $500 of fraudulent transactions. Failure to notify the bank of unauthorized debits within 60 days, could leave the consumer liable for the entire amount.
With credit cards, consumers are generally responsible for only the first $50. Many banks waive even that requirement.
Mr. Tallman argued it would be counterproductive for banks to strictly enforce such rules. What's more, he said, the proper comparison should be between the debit cards and cash, which the cards are meant to replace.
