Bank Checking Revenues Challenged As Debit Preference Drops!

A new report by TSYS supports three trends defined in other studies, which explain why checking revenues are challenged.

The debit card decreased as the preferred payment method.

The debit card rocketed from a standing start to the leader in payment methods for consumers in the first decade of this century, driving community and regional bank revenue and relationships.  But now debit’s winning role is waning amid growth in alternatives, growth in online shopping and security concerns.  Debit's losing role is a result of banks not providing the payment features with bank debit cards consumers want.

Consumers use multiple cards for payment.

While in years past a single payment method, checks, cash or a single personal debit card dominated transactions, today consumers have a myriad of ways to pay.  They choose different ways of paying by transaction, leveraging the key choices of how they are budgeting and avoiding overdraft fees by purchase transaction.  The growth in alternatives to debit are specifically related to the lack of these features offered by banks providing a single debit card choice.

Consumers are concerned about security.

It is no surprise today to read about another security breach.  Consumers expect compromise now and want to be in control of avoiding risk to the funds in their bank account.

 To win back transactions, relationships and payment relevance in the new environment, community and regional banks need to offer multiple payment transaction features with multiple debit card options for individual consumers.  Specfically, they need to provide the clearly marketed option of "no overdraft fees ever" for some transactions, multiple cards for "card" budgeting as "cash envelopes" used to work, and put the consumer in control on managing security when shopping online or in-store with separate cards.  These are exactly the features our clients leverage with the PaySound^® Checking Plan and Companion Cards.