Credit Unions can Maximize Debit Card Programs with Strategic Link Partner, CO-OP
February 4, 2019
The U.S. debit card market accounts for approximately 70 billion transactions worth over $2 trillion in dollar value. As the payments industry undergoes rapid changes, debit remains the second most frequently used form of payment behind cash, according to the Federal Reserve.
This presents an extraordinary opportunity for credit unions. In addition to providing non-interest income, debit continues to play a central role in the lives of members and is therefore a crucial part of building and maintaining member relationships.
To help credit unions build a roadmap for debit portfolio optimization, Strategic Link partner, CO-OP partnered with Mastercard and Mercator Advisory Group to conduct a comprehensive study of the debit industry. The study analyzed survey responses from more than 240 U.S. credit union executives related to debit card usage, issuance, and management.
“CO-OP is known for helping credit unions leverage the latest technology to propel growth, and this study is no exception,” said Northwest Credit Union Association Vice President of Strategic Resources, Jason Smith. “This will help credit unions develop a key source of revenue to even greater levels of volume and profitability.”
Findings from the report highlight several key trends for credit union issuers, including:
- Profitability: Many credit unions surveyed are predicting growth and profitability in the next 12 months for their debit card programs.
- Instant Issuance: The prevalence of instant issue capabilities is driving a high ratio of debit cards to checking accounts. Nearly 40 percent of respondents indicate their credit unions have achieved a 70 percent or greater debit card-to-checking account ratio. In addition, 63 percent of the respondents in this study offer or are planning to offer instant issuance.
- Electronic Funds Transfer (EFT) Network: In-store purchases and withdrawing cash from an ATM are the two most popular transactions among U.S. debit cardholders. As transactions conducted on the PIN debit networks are increasing, they are having a material impact on several fronts, including revenue, rewards, and fraud management.
To learn more about the trends driving debit card usage, issuance and management, and strategies to optimize your debit offering, download the study. For more information about CO-OP, contact NWCUA VP of Strategic Resources, Jason Smith. To learn more about Strategic Link’s partnership with CO-OP, visit its webpage.