Meridian Emerging as Powerhouse Of Debit with Off-Line Visa Product

Meridian Bank, which operates in the shadows of top-tier superregionals like Mellon Bank and PNC Bank, is making a disporportionately large impact on the debit card business.

Meridian's Visa Check program is the 10th-largest off-line debit card program in the nation and the largest in the Pennsylvania-New Jersey- Delaware region, with 400,000 active cardholders.

The $14 billion-asset bank entered the debit game in 1991.

"There was no local competition (in off-line debit), so we saw an opportunity," said Joseph S. Pendleton 3d, senior vice president of electronic banking.

Meridian customers' on-line point of sale activity, mainly through the regional MAC network, was doubling every year without any significant promotion. "It was a clear message that our customers were inclined to do POS," said Mr. Pendleton.

The Reading, Pa., bank mailed most of its checking account customers with active automated teller machine cards an Advantage card, which would be activated upon use. More than 60%, or 120,000 customers, opted for the card. Advantage can be used for purchases anywhere a Visa card is accepted, and the funds are debited from a checking account.

Mr. Pendleton said growth has been steady from the beginning. The bank does print, radio, and some television advertising, which has attracted new checking account business because of the debit service.

"Now we've got competitors with similar products, but we're still adding a lot of cards every month," said Mr. Pendleton.

Meridian charges its Visa Check customers a $15 annual fee, waived for the first year. The card performs on-line transactions through the MAC, NYCE, Most, and Plus ATM networks, as well as off-line at any Visa merchant.

Mr. Pendleton estimates an average of 25,000 transactions are posted daily, but in late December, volume was reaching 10,000 per hour.

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