RANCHO CUCAMONGA, Calif.-Saying that today it takes the checking account AND the payment card to become a member's PFI, CO-OP Financial Services shared advice on tuning up card portfolios.
"Payments have been elevated in consumer importance," said Ryan Zilker, B2B marketing manager, during a recent CO-OP webinar. "You can no longer just set your cards programs and forget them."
That's become even more clear, he said, as competition in the payments space heats up quickly. Prepaid is making huge inroads on cash and checks, mobile growth is exploding, and new payment alternatives from non-financial players steadily emerge.
Amid all this activity, Zilker stressed targeting "the right members with the right message at the right time. Analytics can do that."
Noting the company offers CO-OP Total Revelation, an analytics solution that marries actual transaction data and behavior spending with cardholder demographics, Zilker said that just as important as sending the correct message to members is hitting hard with the message of trust.
"The big banks are back, especially with credit cards. But consumers have not forgotten how they were treated by banks and their credit card practices not too long ago."
Creative Offerings
The resurgence of the big issuers demands, too, that CUs be more creative with offerings. "There are a lot of new twists, especially with rewards, like points that can be turned in for flight vouchers or used on airline bag fees and priority boarding."
Pointing out that responsible credit card users keep their usage under 30% of their credit line, Zilker said there is opportunity for CUs to increase their balances with these good cardholders, and not add risk, by increasing credit lines.
Just as necessary as strengthening the credit and debit card portfolios, is paying attention to all the changes in the payments space and remaining as informed as possible, said Michelle Thornton, senior product manager. EMV is on the horizon, but she said CO-OP advises CUs to remain cautious on EMV deployment.
"To EMV or not to EMV, that is the question," kidded Thornton. "EMV enabled terminals are scarce today, the cards are expensive-especially if you have to reissue due to fraud-and network issues abound. There are no regulatory or network mandates for issuers to go to EMV. EMV is being driven by liability shifts."
CO-OP has stated the company believes commercialization of EMV will take time, recommending issuers wait until 2014 before moving forward with their business case for EMV deployment. CO-OP will be providing guidance to credit union clients via tools to help them determine their own EMV roadmap.
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