Independent Banker - January 2019 - 19

Next: Why site visits still matter to your bank
Jarosinski, first vice president of bank cards and
payments at $700 million-asset Bankers' Bank
in Madison, Wis. " It helps consumers get used to
the fact that their card can be used contactless,
and hopefully, it's a bridge to mobile adoption. "
Contactless cards simplify the payment experience
for the consumer as a tool in a bank's
digital strategy. Each bank will determine how a
contactless card complements a broader wallet
approach, supporting " top-of-wallet " goals.
" Contactless is a stepping stone into a digital
interaction, and it's changing the way you interact
with the POS, " says Bob Legters, chief product
officer of payments and banking product lines
at FIS.
to take a card out of their purse or wallet, and it's
less expensive on the institution. "
Time to make a move
Whichever way a community bank's strategy
goes, contactless payments should play a key
role. And with the first EMV chip cards expiring,
if cards are in the cards for your bank, the time
may be right to make the switch.
" I would tell any banker that now is the time to
begin to deploy contactless cards, " Giorgio says.
" The first-generation EMV chips began expiring
Dipping into bank strategy
Contactless hasn't caught fire in the U.S., but
globally, these payments are soaring. And, as seen
abroad, with increases in usage comes revenue.
" Contactless cards are an opportunity for
growth and acquisition, " says Tina Giorgio, president
and CEO of ICBA Bancard. " Research from
the U.K. and Australia indicates banks see up to a
30 percent increase in transaction volume. That's
a lot of revenue opportunity. "
As banks seek to deploy contactless cards, they
recognize a need for customer education. However,
most contactless cards can also function
traditionally, so a customer could dip or swipe
the card and still make the payment. But the customer
would soon realize the card's full potential
and take advantage of its contactless functionality
thereafter.
" It'll be a fun learning experience, " Jarosinski
says. " At the very least, they can transact the way
they've always transacted, but what we hope will
happen is that they start loving it. "
Yet, not all banks see contactless cards as a
transitional component of a digital strategy.
Take Axiom Bank, a $600 million-asset institution
headquartered in Maitland, Fla. It works to
drive adoption of its AxiomGO app by brokering
relationships with major players like Apple Pay,
Samsung Pay and Google Pay to become the customer's
preferred digital wallet.
" We found most consumers, as far as contactless
payments go, just prefer doing it on their
phone, " says Pete Longo, Axiom Bank's vice president
of digital banking. " A lot of them don't want
" It helps consumers
get used to the fact
that their card can be
used contactless‚ and
hopefully‚ it's a bridge to
mobile adoption. "
-Robert Jarosinski, Bankers' Bank
in 2018, and if you are going to certify a new
EMV card, you might as well deploy contactless
at the same time. Many of the large banks are
doing the same. "
Quick stat
95%
of new terminals
shipped in the
U.S. are capable
of contactless
transactions
Contactless terminals are also more prevalent.
Seventy percent of POS terminals in the U.S. are
contactless-enabled now, and about 50 percent
of card transactions are occurring at those terminals.
In addition, more than 95 percent of new
terminals shipped are contactless-enabled.
Once a bank decides to offer a contactless card,
it can go live in as little as four to six weeks, with
the longest implementation at about six months,
depending on its customization. The bank just
needs to say " go. "
" If a bank asks itself the question, 'Is contactless
going to be important to my consumers?'
the answer is going to be yes, " Legters says. " Not
starting now puts you behind the pack and makes
it hard to compete. "
Colleen Morrison is a writer in Virginia.
independentbanker.org Q 19
http://www.independentbanker.org
Independent Banker - January 2019

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