Banks need not worry about "cannibalizing" their card portfolios if they offer customers alternative payment methods, because the latter attracts a different type of consumer, a SunTrust Banks Inc. executive said.

"What drives the use of one [method] over the other is payments preference," Steve Karp, SunTrust's executive vice president of enterprise payments strategy, said this week at the ATM Debit & Prepaid Forum in Las Vegas. (The conference is hosted by SourceMedia Inc.) For example, some customers prefer alternative payments because of the perceived ease of use and increased security, he said.

"There is always going to be the card guy in the room who will say [alternative payments] are taking transactions away from cards," Karp said. That concern would be relevant only if consumers who are using alternative payments are also using cards, he said, and his Atlanta company's research has found "that's just not the case."

He said SunTrust is testing alternative payment methods "to be defensive and at least try to get a few pennies back" that financial institutions lose every year to those methods, Karp said.

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