A new report by First Data, a global technology and payments processing leader based in Atlanta, reveals banks missing major debit card opportunities.
The report is based on interviews with 34 across 10 mature and emerging markets including Australia, Brazil, Germany, Greece, India, Mexico, Poland, Turkey, United Kingdom and the United States. It suggests that need to apply many of the elements of their credit card programs to debit cards, such as reward programs and additional segmenting.
Click here to download the full report Worldwide Opportunities for Debit.
First Data Study Reveals Banks Missing Out on Major Opportunity to Improve Profitability of Their Debit Programs
Opportunities Can Be Found by Applying “Credit” Strategies to Debit Programs; Fraud and Increased Regulation Seen as Threats to Growth;
Innovation Greatest in Emerging Markets
ATLANTA, July 15, 2010 – Banks must apply more energy and innovation to developing their debit programs, to make debit usage a more valuable proposition for themselves and their cardholders, according to a multinational study released today by First Data Corporation, a global leader in electronic commerce and payment processing.
‘Worldwide Opportunities for Debit’ is one of the first studies to examine the growth of debit around the world and assess both the drivers behind this increase and its implications for the banking industry. The report incorporates data from interviews of 34 banks across a mix of 10 mature and emerging markets around the world. Interviews were carried out for First Data by TowerGroup with participants from Australia, Brazil, Germany, Greece, India, Mexico, Poland, Turkey, United Kingdom and the United States. In addition, industry analysts from Asia Pacific, Europe and the Americas contributed perspectives and insight.
Beyond confirming the emergence of debit as the primary instrument to the payment account, Worldwide Opportunities for Debit also recommends growth strategies banks should adopt and warns of impending threats to their ability to take full advantage of the opportunity debit programs represent.
“Banks can capitalize on consumers’ move to debit if they develop a sophisticated understanding of the economics of their debit offerings and put the same innovative energy behind debit as they do behind credit,” said Paul Stanley, SVP Financial Services, EMEA, First Data. “However, our study warns that fraud and increased regulation could dampen the debit experience for both banks and their customers.”
Key findings from the study include:
“We found a disappointing lack of product innovation and analytics in debit, even among institutions that are sophisticated on the credit card side,” said Brian Riley, Research Director, Bank Cards, TowerGroup. “In emerging economies, there is more focus on the opportunities, and on innovation.”
The Need to Understand Debit Economics
Maximizing Debit Profitability
The Impact of Regulation
For more information on Worldwide Opportunities for Debit or to download the full study, please go to http://www.firstdata.com/en_us/insights/global-debit-study.
About First Data
First Data powers the global economy by making it easy, fast and secure for people and businesses to buy goods and services using virtually any form of electronic payment. Whether the choice of payment is a gift card, a credit or debit card or a check, First Data securely processes the transaction and harnesses the power of the aggregate data to deliver intelligence and insight for millions of merchant locations and thousands of card issuers in 36 countries. For more information, visit www.firstdata.com.
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