New Uses for Debit Cards Emerge
After years of benign neglect, bankers and technology companies are making a big push to create new business for the debit card.
Nearly every major product to be announced at this year's Bank Administration Institute retail delivery conference, which opens today in Orlando, Fla., is designed to take advantage of the proliferation of plastic originally designed for use with automated teller machines.
"With all those cards out there, bankers have a tremendous amount of leverage, and now they are looking to use it," said Nik Banerjee, practice leader at the Bank Administration Institute's center for banking excellence. "They are slowly coming to realize that the only real growth area left [for bankers] is retail."
Likelihood of Use
Bankers have struggled for years to increase the number of ATM/debit cards held by consumers, firmly believing that a customer who carries plastic will eventually use it.
With signs that this theory is a valid one - the industry has reported double-digit growth in card usage for the last two years - bankers have begun demanding products that will allow them to expand the role the cards play.
And bank automation vendors are more than willing accommodating those demands.
NCR Corp., Dayton, Ohio, the leading domestic shipper of ATMs, plans to unveil today a self-service banking terminal that uses video teleconferencing to bring full-service banking to remote locations. After inserting an ATM card, the new terminal allows customers to access a wide variety of banking information, including detailed account status and current interest rates on bank products.
Video to the Rescue
If a question arises, the customer can summon a bank representative to the video screen with a touch of a button.
The technology, which is being tested at Huntington Banks, Columbus, Ohio, is the first in a string of projects that NCR hopes to jointly develop with its new parent, American Telephone and Telegraph Corp.
"Sixty-five to 70% of banks' total overhead costs are presently going towards retail delivery, and we are realizing that can't continue," said William Randle, director of marketing at Huntington Bancshares, Inc., Columbus.
Costs Under Control
"Now that customers are comfortable with electronic delivery systems, we can figure out ways to get them the services they want without burying ourselves with cost."
Another ATM-related announcements should come from InterBold, North Canton, Ohio. The company, a joint venture of Diebold Inc. and International Business Machines Corp. plans to introduce a new compact cash dispenser designed for supermarkets and other retail locations. Like all of InterBold's new "i" series machines, the dispenser comes with a money-back guarantee of 99% availability.
Fujitsu Systems of America, Inc., San Diego, is announcing several enhancements to its series 7000 automated teller machines.
Choice of Usages
The most important of these is a software package that will allow customers to perform transactions using either the standard function keys or an additional set of lowered keys designed for people in wheelchairs. This will help bankers to comply with the Americans with Disabilities Act, which requires banks make facilities more accessible to the handicapped.
The new ATMs from NCR, InterBold, and Fujitsu all meet the act's height and reach requirements, company representatives said.
Beyond self-service banking, though, several companies have developed new uses for the debit card.
For example, Atalla Corp., San Jose, Calif., is taking the wraps off a family of terminals that enables customers to initiate transactions at the teller window by swiping their ATM card and inputting their personal identification number.
In addition to the technological announcements, MasterCard and Visa will be attending the conference to drum up support for their on-line debit card programs with financial institutions.
In such a system, retailers are linked directly with demand deposit accounts at financial institutions, so that when a customer makes a purchase, the money is immediately transferred to a retailer's account.
PHOTO : SLENDER TM, an interBold 1064i, is a space saver.