Blackhawk Network, a California-based company in the prepaid, gift card, and payments industry, joined forces with NAPCO Research, the “research arm” of NAPCO Media, a B2B digital media company, for the fifth year. Their aim? To assess the in-store, online, and mobile gift card program experiences across more than 225 merchants. This time, their annual research has extended beyond the U.S. and includes the UK and Australia for the first time.

The findings of the “2022 NAPCO Research Merchant Gift Card Omnicommerce Evaluation” report were discussed by Amy Dunckelmann, VP of Research Operations at Mercator Advisory Group, Andrew Solomon, Vice President of Sales at Blackhawk Network, and Hilary Spidaliere, Director of Product Marketing at Blackhawk Network.

PaymentsJournalAssessing Merchant Gift Card Programs and Actionable Best PracticesPaymentsJournal Assessing Merchant Gift Card Programs and Actionable Best PracticesPaymentsJournaljQuery(document).ready(function ($){var settings_ap67057086 = { design_skin: "skin-wave" ,autoplay: "off",disable_volume:"default" ,loop:"off" ,cue: "on" ,embedded: "off" ,preload_method:"metadata" ,design_animateplaypause:"off" ,skinwave_dynamicwaves:"off" ,skinwave_enableSpectrum:"off" ,skinwave_enableReflect:"on",settings_backup_type:"full",playfrom:"default",soundcloud_apikey:"" ,skinwave_comments_enable:"off",settings_php_handler:window.ajaxurl,skinwave_wave_mode:"canvas",pcm_data_try_to_generate: "on","pcm_notice": "off","notice_no_media": "on",design_color_bg: "111111",design_color_highlight: "ef6b13",skinwave_wave_mode_canvas_waves_number: "3",skinwave_wave_mode_canvas_waves_padding: "1",skinwave_wave_mode_canvas_reflection_size: "0.25",skinwave_comments_playerid:"67057086",php_retriever:"https://www.paymentsjournal.com/wp-content/plugins/dzs-zoomsounds/soundcloudretriever.php" }; try{ dzsap_init(".ap_idx_390158_27",settings_ap67057086); }catch(err){ console.warn("cannot init player", err); } });

The pandemic accelerated digital transformation within businesses and Dunckelmann believes that this study could not be timelier:

“One of the reasons I really liked this study, especially that you’ve got research that goes back for five years, the trend in the report really shows much more of an emphasis on digital, especially with what’s happened in the pandemic, and more businesses looking for digital options. I think it’s really smart to help vendors understand their digital experience and what they can do to improve it. So, I think, although this is the fifth year, it’s certainly very timely in terms of results.”

Solomon spoke favorably about this study as well, adding:

“It really creates a framework not only for a customer that has an existing program to expand on their program and take it to the next level. But someone who’s entering the business, it shows you the roadmap of what some of the most successful companies are doing. And they can implement those ideas without having to do trial and error. So it just creates a great, great roadmap for our customers and our potential customers.”

The Methodology

To conduct the study, the NAPCO Research team visited each merchant store, visited the websites, accessed the mobile apps, and purchased the gift cards. All these experiences were assessed using more than 150 criteria, which have been developed and amassed during the last five years of conducting this annual study.

Many financial institutions are in a time of transition. With the continuous decline in check volume,  it’s important for banks and credit unions to find efficiencies where they can. One area where financial institutions can realize immediate benefits is by outsourcing their item processing function. To learn more, PaymentsJournal sat with Joe Pachunka, CIO of Deposit Solutions at Fiserv, and Sarah Grotta, Director of Debit and Alternative Products Advisory Service at Mercator Advisory Group, to discuss the many benefits of outsourcing item processing.

PaymentsJournalPaymentsJournalPaymentsJournaljQuery(document).ready(function ($){var settings_ap17124359 = { design_skin: "skin-wave" ,autoplay: "off",disable_volume:"default" ,loop:"off" ,cue: "on" ,embedded: "off" ,preload_method:"metadata" ,design_animateplaypause:"off" ,skinwave_dynamicwaves:"off" ,skinwave_enableSpectrum:"off" ,skinwave_enableReflect:"on",settings_backup_type:"full",playfrom:"default",soundcloud_apikey:"" ,skinwave_comments_enable:"off",settings_php_handler:window.ajaxurl,skinwave_wave_mode:"canvas",pcm_data_try_to_generate: "on","pcm_notice": "off","notice_no_media": "on",design_color_bg: "111111",design_color_highlight: "ef6b13",skinwave_wave_mode_canvas_waves_number: "3",skinwave_wave_mode_canvas_waves_padding: "1",skinwave_wave_mode_canvas_reflection_size: "0.25",skinwave_comments_playerid:"17124359",php_retriever:"https://www.paymentsjournal.com/wp-content/plugins/dzs-zoomsounds/soundcloudretriever.php" }; try{ dzsap_init(".ap_idx_388996_27",settings_ap17124359); }catch(err){ console.warn("cannot init player", err); } });

Focus on Core Business

Though check volumes are declining, item processing is still a vital function for banks, Pachunka noted.

“Check processing can be thought of as a legacy business, but it’s still a very valid channel for transactions,” he added. “And it has to be up 24/7.”

By outsourcing such a manual and time-intensive function, banks can focus on their core business and focus on other areas.

Indeed, Grotta observed that by outsourcing this part of the business, banks can focus more on pursuing innovation.

“Many of the financial institutions I talk to don’t necessarily want to focus on item processing and are happy to have someone else oversee that part of business,” she said. Outsourcing to a respected vendor also enables banks to improve their cybersecurity stance and reduce system resiliency risk, added Pachunka, while at the same time receiving new application features on a daily basis.

“We are seeing some cases where in-house hosted systems applications are rarely updated even once annually,” he continued. “In some cases, updates were not applied for over three years.”

Fiserv, he noted, updates its application software three or four times per year.

“When you consider that we are living in a rapidly evolving cyber risk environment, rapid application deployment of resolved cyber risk findings is key to addressing the ever-increasing risks that are around us,” Pachunka said.

Perhaps it is no surprise then that recent statistics indicate that outsourced financial services will rise by 7.5% annually.

Overcoming Talent Retention Issues

Outsourcing can also help during times when it is d...

Fraud and cyberattacks that target children are alarmingly on the rise. According to data from an upcoming report to be published by Javelin Strategy & Research, nearly $1 billion was lost to child ID fraud in 2021. Furthermore, 1 in 50 children were affected by child identity fraud during the past year and 1 in 45 minors’ personal information was exposed via data breaches in the past year.

These attacks are increasing because children are online more than ever. It isn’t just social media; children are playing video games online, engaging in discussion on forums such as Reddit and Discord, and much more. In order to protect these young consumers, parents need to be educated about how their children are being targeted by fraudsters online. But financial institutions can play a key role in stopping child identity fraud as well.

To find out more, PaymentsJournal sat with Javelin’s Director of Fraud & Security Tracy Kitten, and Ben Halpert, founder of savvycyberkids.org, an online resource teaching children and their parents about cyber safety.

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Getting Ahead of the Child Identity Fraud Problem

The easiest way to stop the scourge of child identity fraud is to get ahead of the problem by educating children and their parents on the various ways fraudsters target children. Criminals obtain personally identifiable information (PII) from children in various ways, such as by interacting with them online or by finding information on the dark web from previously exposed data breaches. After cybercriminals have enough PII, they can use that child’s identity or create a synthetic identity with PII gleaned from multiple victims, and open new accounts, take out loans, or commit many other types of fraud.

Children need to know what types of information they should not give out online and learn to identify the tactics used by those trying to scam them, Kitten said. Financial institutions, though not directly involved in these attacks, can engender consumer trust and loyalty by offering information and education to their customers on how to stop child identity fraud, she added.

“Financial institutions need to let parents know that they are a resource when it comes to preventing child identity fraud,” she said. “Financial institutions have an opportunity to really play the role of a leader in this space and act as an educator to their customers.”

Times of rampant high inflation, such as that we are living in now, affect consumers and businesses in various ways. But one segment that is typically most adversely affected by inflation are workers who are paid an hourly wage. How can earned wage access make an impact?

As inflation forces difficult spending and budgeting decisions in households across the country, this demographic is among the hardest hit. One study conducted in July found that about half of hourly workers did not have any emergency savings at all, and nearly 80% had less than $500 tucked away. Only a small percentage of workers have seen their wages outpace inflation, according to research.

This is why it is critical for employees to have on-demand pay access in order to better manage their cash flow. And it’s also important for employers to offer this service, which plays a large role in employee retention and satisfaction. To learn more about earned wage access, PaymentsJournal sat with Darren Cho, VP of Product at DailyPay, and Steve Murphy, Director of Mercator Advisory Group’s Commercial and Enterprise Payments Advisory Service.

PaymentsJournalWhy Earned Wage Access Is Critical for Employees and BusinessesPaymentsJournal Why Earned Wage Access Is Critical for Employees and BusinessesPaymentsJournaljQuery(document).ready(function ($){var settings_ap26174883 = { design_skin: "skin-wave" ,autoplay: "off",disable_volume:"default" ,loop:"off" ,cue: "on" ,embedded: "off" ,preload_method:"metadata" ,design_animateplaypause:"off" ,skinwave_dynamicwaves:"off" ,skinwave_enableSpectrum:"off" ,skinwave_enableReflect:"on",settings_backup_type:"full",playfrom:"default",soundcloud_apikey:"" ,skinwave_comments_enable:"off",settings_php_handler:window.ajaxurl,skinwave_wave_mode:"canvas",pcm_data_try_to_generate: "on","pcm_notice": "off","notice_no_media": "on",design_color_bg: "111111",design_color_highlight: "ef6b13",skinwave_wave_mode_canvas_waves_number: "3",skinwave_wave_mode_canvas_waves_padding: "1",skinwave_wave_mode_canvas_reflection_size: "0.25",skinwave_comments_playerid:"26174883",php_retriever:"https://www.paymentsjournal.com/wp-content/plugins/dzs-zoomsounds/soundcloudretriever.php" }; try{ dzsap_init(".ap_idx_388558_25",settings_ap26174883); }catch(err){ console.warn("cannot init player", err); } });

DailyPay partners with employers to enable employees to instantly transfer money between pay periods that they have earned to any bank account for a small fee, with 100% of their net pay earned up to that point available. Most of the employers it partners with pay a large segment of their workers on an hourly basis. The firm also recently created a Digital Wallet called Friday, which comes with GPR Visa card and companion mobile app. Users can download the Friday app to receive the Visa card, and immediately access their earned pay without transfer fees by connecting direct deposit to Friday in a single tap. 

Darren said enabling easy and instant access to earned pay is vital for the financial wellness of hourly and gig economy workers.

“A lot of working Americans are living paycheck to paycheck, especially hourly workers,” said Darren. “Their income is often unstable and unpredictable, so it’s really easy to run into an overdraft fee situation or face late fees.

There is a common misconception that business credit cards are only for midsize to large businesses, as small business owners commonly use personal credit cards for their businesses. Furthermore, marketing for business cards has not traditionally been targeted at small business owners.

However, banks are starting to rethink that strategy. They see small businesses as essential for business card portfolio growth and are using innovative expense management tools to help attract small business customers.

To find out more about how business credit card management plays a role in driving business card portfolio growth, PaymentsJournal sat down with Surender Chuahan, VP Product Management at Fiserv and Brian Riley, Director of Credit Advisory Service at Mercator Advisory Group.

PaymentsJournalNimble and Intuitive Card and Expense Management Tools Are Essential for Business Card Portfolio GrowthPaymentsJournal Nimble and Intuitive Card and Expense Management Tools Are Essential for Business Card Portfolio GrowthPaymentsJournaljQuery(document).ready(function ($){var settings_ap39633849 = { design_skin: "skin-wave" ,autoplay: "off",disable_volume:"default" ,loop:"off" ,cue: "on" ,embedded: "off" ,preload_method:"metadata" ,design_animateplaypause:"off" ,skinwave_dynamicwaves:"off" ,skinwave_enableSpectrum:"off" ,skinwave_enableReflect:"on",settings_backup_type:"full",playfrom:"default",soundcloud_apikey:"" ,skinwave_comments_enable:"off",settings_php_handler:window.ajaxurl,skinwave_wave_mode:"canvas",pcm_data_try_to_generate: "on","pcm_notice": "off","notice_no_media": "on",design_color_bg: "111111",design_color_highlight: "ef6b13",skinwave_wave_mode_canvas_waves_number: "3",skinwave_wave_mode_canvas_waves_padding: "1",skinwave_wave_mode_canvas_reflection_size: "0.25",skinwave_comments_playerid:"39633849",php_retriever:"https://www.paymentsjournal.com/wp-content/plugins/dzs-zoomsounds/soundcloudretriever.php" }; try{ dzsap_init(".ap_idx_388437_28",settings_ap39633849); }catch(err){ console.warn("cannot init player", err); } });

Businesses’ Credit Cards as a Revenue Driver

Offering business credit cards represents an attractive revenue opportunity for financial institutions. The average ticket size of a business transaction is 2.4 times that of a consumer ticket.

Historically, financial institutions have focused on midsize to large businesses. Recently, the landscape has changed a lot with the gig economy in the picture, and we are seeing a huge growth of small businesses. As Chuahan noted, “there are 32.5 million small businesses in the US alone.”

Most of these small businesses need cash, liquidity, and lending. Arguably, the credit card is the best way to do that. Among other benefits, credit cards provide a grace period to make payments.

Research shows that many small business owners just use a personal Visa or Mastercard. This practice is convenient, but it also has drawbacks.

If you go through an IRS audit, you’re going to have to reveal all your [personal] purchasing habits to the IRS if they’re on your card. Having a separate business credit card for expenses keeps personal and business activities separate.

There are other drawbacks to using a personal credit card for business purposes. Chuahan described how it can be frustrating for employees who use their own credit cards for company purchases and then have to file for reimbursement through a cumbersome process.

“You don’t want to get stuck because there is somebody who’s waiting to ge...

For debit and credit card issuers, marketing has always been a pillar to growing the business: attracting new customers, activating those who have gone dormant, and finding incentives that increase business from active customers.

As happened with so many elements of consumers’ lives, the fundamentals of their engagement with card accounts shifted after the onset of the COVID-19 pandemic, requiring issuers to adjust their marketing approaches.

In this installment of the PaymentsJournal podcast, Lesley DeCator, General Manager of the PaymentsEdge Marketing and Advisory Services at FIS, and Don Apgar, Director of the Merchant Services Advisory Service at Mercator Advisory Group, discussed the current environment in marketing strategies, the importance of proper customer segmentation in campaigns, how the pandemic affected the offering of incentives, the use of communication channels to most effectively reach current and prospective customers, and extracting actionable intelligence from response rates and thus building a strong return on the marketing investment.

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As DeCator noted, the pandemic certainly changed the spending environment—for example, debit and card-not-present transactions rose, consumers shopped extensively from home rather than in large groups in brick-and-mortar stores—but the underlying principles of marketing have proved durable.

“The basics are the same,” she said. “We need consistent communication, a very strong call to action, compelling incentives, and great cardholder service. The key to success is careful planning and timely execution. … And then you need to be able to pivot when situations change quickly, as they are prone to do.”

Building a Strong Marketing Campaign

The aim of PaymentsEdge, DeCator said, is to tailor marketing campaigns for clients based on the following foundation:

* Strong messaging* A strong blending of the creative aspect of campaigning with cardholder response* Low costs for clients so they can get the most from their marketing budgets

Here’s how those efforts played out vs. the results for FIS clients not using the PaymentsEdge advisory services for 2021 vs. 2020 in terms of growth:

The ACH (Automated Clearing House) Network affects most Americans daily, having moved nearly $73 trillion in payments in 2021, according to Nacha, the organization that governs it. 

As payments constantly evolve and become more digital and faster, the ACH Network is also evolving in order to meet the needs of both businesses and consumers. To learn more about how it is handling the new world of payments and what might be in store for the future, PaymentsJournal sat with Michael Herd, Senior Vice President of ACH Network Administration at Nacha, and Steve Murphy, Director of Mercator Advisory Group’s Commercial and Enterprise Payments Advisory Service, for a discussion on this vital payments network that Americans use every day.

PaymentsJournalHow the ACH Network Is Evolving to Meet the Needs of Businesses and ConsumersPaymentsJournal How the ACH Network Is Evolving to Meet the Needs of Businesses and ConsumersPaymentsJournaljQuery(document).ready(function ($){var settings_ap28445071 = { design_skin: "skin-wave" ,autoplay: "off",disable_volume:"default" ,loop:"off" ,cue: "on" ,embedded: "off" ,preload_method:"metadata" ,design_animateplaypause:"off" ,skinwave_dynamicwaves:"off" ,skinwave_enableSpectrum:"off" ,skinwave_enableReflect:"on",settings_backup_type:"full",playfrom:"default",soundcloud_apikey:"" ,skinwave_comments_enable:"off",settings_php_handler:window.ajaxurl,skinwave_wave_mode:"canvas",pcm_data_try_to_generate: "on","pcm_notice": "off","notice_no_media": "on",design_color_bg: "111111",design_color_highlight: "ef6b13",skinwave_wave_mode_canvas_waves_number: "3",skinwave_wave_mode_canvas_waves_padding: "1",skinwave_wave_mode_canvas_reflection_size: "0.25",skinwave_comments_playerid:"28445071",php_retriever:"https://www.paymentsjournal.com/wp-content/plugins/dzs-zoomsounds/soundcloudretriever.php" }; try{ dzsap_init(".ap_idx_387228_28",settings_ap28445071); }catch(err){ console.warn("cannot init player", err); } });

Payments volume, especially B2B payments, continues to grow significantly on the ACH Network in 2022, noted Herd. The number of transactions on the ACH Network increased 2.8% so far this year, with B2B payments increasing 14% so far in 2022 B2B payments are defined as invoice and supplier payments from one business to another or merchants and businesses getting funded for card activity. It does not include payroll direct deposits, which are a separate category.

“So, the increase in volume of B2B payments has been really dramatic,” he said. “We’re also seeing very, very high levels of dollars moving through Same Day ACH windows. And consumer payments continue to be strong as well despite the end of the pandemic-era assistance payments.”

ACH Limit Increase to $1 Million

Murphy asked about the impact of the ACH Network’s move in March to increase the Same Day ACH payment limit to $1 million. Nacha members approved a measure to increase the per-payment maximum from the previous limit of $100,000 to $1 million effective March 18, 2022. It applies to all eligible Same Day ACH payments, including credits and debits for both businesses and consumers.

The $1 million limit can be used for many different types of payments, from insurance claim payments and payroll funding to business-to-business and tax payments, according to Nacha.

The second quarter was the first full quarter with this per-pa...

Halfway through 2022, it’s not that the fight against payments fraud has shifted to a whole new ball game. While criminals’ tactics are ever-evolving, the real challenge lies in the breadth and complexity of the fraud. It’s many ball games on many fields, all at once, and that’s the environment confronted by card issuers, merchants, and consumers alike.

Eric Kraus, Vice President of Fraud, Risk and Compliance Solutions at FIS, and John Buzzard, Lead Analyst in the Fraud & Security practice at Javelin Strategy & Research, discussed the current environment on an installment of PaymentsJournal Podcast, going in-depth on such topics as the evolving nature of fraud, how FIS’s acquisition of Worldpay has fortified efforts to combat fraud, insights gleaned from Javelin’s most recent identity fraud study, the risks of peer-to-peer payments, and ongoing consumer education and the steps needed to preserve and strengthen the connected relationships between card issuers and customers, customers and merchants, and merchants and acquiring banks.

PaymentsJournal What Debit and Credit Card Issuers Need to Know About Current Trends in Payments FraudPaymentsJournal  What Debit and Credit Card Issuers Need to Know About Current Trends in Payments FraudPaymentsJournaljQuery(document).ready(function ($){var settings_ap28663093 = { design_skin: "skin-wave" ,autoplay: "off",disable_volume:"default" ,loop:"off" ,cue: "on" ,embedded: "off" ,preload_method:"metadata" ,design_animateplaypause:"off" ,skinwave_dynamicwaves:"off" ,skinwave_enableSpectrum:"off" ,skinwave_enableReflect:"on",settings_backup_type:"full",playfrom:"default",soundcloud_apikey:"" ,skinwave_comments_enable:"off",settings_php_handler:window.ajaxurl,skinwave_wave_mode:"canvas",pcm_data_try_to_generate: "on","pcm_notice": "off","notice_no_media": "on",design_color_bg: "111111",design_color_highlight: "ef6b13",skinwave_wave_mode_canvas_waves_number: "3",skinwave_wave_mode_canvas_waves_padding: "1",skinwave_wave_mode_canvas_reflection_size: "0.25",skinwave_comments_playerid:"28663093",php_retriever:"https://www.paymentsjournal.com/wp-content/plugins/dzs-zoomsounds/soundcloudretriever.php" }; try{ dzsap_init(".ap_idx_386723_28",settings_ap28663093); }catch(err){ console.warn("cannot init player", err); } });

It’s a lot for all the parties to take in — as Buzzard noted, increases are being seen across almost every area of fraud that is tracked, a situation he described as “joker’s wild” and Kraus called “the Wild West.”

The Current Payments Fraud Environment

Kraus broke down the present situation for both card issuers and merchants.

On the card-issuing side, the biggest fraud challenges are:

* Card enumeration (also known as bank identification number, or BIN, attacks), which Kraus described as “high-velocity number guessing”* Card-not-present fraud* Point-of-sale fraud (such as at automated fuel dispensers)* Account takeover, which is on the rise again after some pandemic-related lows (“We hypothesize that organized crime was focused on other schemes,” including fraud aimed at Paycheck Protection Program recipients, stimulus payments, and unemployment benefits.)

On the merchant side, two big areas of fraud stand out, Kraus noted:

* First-party fraud (“Within our own merchant e-commerce space, we’ve seen numbers as high as 80% of disputes being of a first-party nature.”)* Digital skimming, which he noted can become the “feeding ground” for fraud against bank...

Digital transformation is top of mind for financial institutions of all stripes, yet many are cautious when initiating such projects and unsure where to begin due to the inherent risk associated with modernizing legacy systems.

This is especially true when it comes to modernizing payments systems. Today’s consumer wants to not only pay using traditional card-based methods, but also wants to use the vast array of digital payments available and new innovations such as buy now pay later (BNPL).

How financial institutions can successfully modernize their payments systems will be a focus of discussion at Diebold Nixdorf’s upcoming Intersect conference in Las Vegas on August 29–31. The annual conference is returning after a two-year hiatus brought on by the COVID-19 pandemic.

To hear more about what financial institutions will learn about modernizing, PaymentsJournal sat with Michael Engel, Managing Director & VP Payments for Diebold Nixdorf, and Sarah Grotta, Director of Debit and Alternative Products Advisory Service for Mercator Advisory Group.

PaymentsJournalWhat to Expect from Diebold Nixdorf’s Upcoming Intersect Conference in Las VegasPaymentsJournal What to Expect from Diebold Nixdorf’s Upcoming Intersect Conference in Las VegasPaymentsJournaljQuery(document).ready(function ($){var settings_ap29832614 = { design_skin: "skin-wave" ,autoplay: "off",disable_volume:"default" ,loop:"off" ,cue: "on" ,embedded: "off" ,preload_method:"metadata" ,design_animateplaypause:"off" ,skinwave_dynamicwaves:"off" ,skinwave_enableSpectrum:"off" ,skinwave_enableReflect:"on",settings_backup_type:"full",playfrom:"default",soundcloud_apikey:"" ,skinwave_comments_enable:"off",settings_php_handler:window.ajaxurl,skinwave_wave_mode:"canvas",pcm_data_try_to_generate: "on","pcm_notice": "off","notice_no_media": "on",design_color_bg: "111111",design_color_highlight: "ef6b13",skinwave_wave_mode_canvas_waves_number: "3",skinwave_wave_mode_canvas_waves_padding: "1",skinwave_wave_mode_canvas_reflection_size: "0.25",skinwave_comments_playerid:"29832614",php_retriever:"https://www.paymentsjournal.com/wp-content/plugins/dzs-zoomsounds/soundcloudretriever.php" }; try{ dzsap_init(".ap_idx_386276_28",settings_ap29832614); }catch(err){ console.warn("cannot init player", err); } });

Overcoming Fear of Change

The biggest reason financial institutions put off modernizing their payments systems is the potential risk and fear of something going wrong. Engel noted the adage “no one ever got fired for buying IBM,” and said many bank and credit union executives hesitate to move from systems that work fine, even if the systems are decades old.

“Banks do understand that they need to future-proof,” he added. “But change is always associated with risk. Many feel soft and cozy with their legacy systems, and it feels safer to do nothing than to take a risk.”

Still, he noted that there are risks involved in simply staying the course. For one, financial institutions that do so can’t offer their customers access to the latest innovative digital products and services. Being able to do so is a matter of staying competitive.

“Fintechs will come in and provide these services and win customers if banks don’t change,” Engel said.

He added that the siloed legacy systems many financial institutions ...

There is a common misconception that today’s bank and credit union customers want to do everything in a digital channel. The fact is that when it comes to financial services, consumers often have high expectations: in-person assistance when help is needed, plus the convenience of on-demand, self-service digital and mobile channels. How can retail banks and ATMs help meet these expectations?

ATMs play a key role in delivering this experience. Specifically, interactive ATMs that can handle most of the basic transactional work typically done in branches by tellers, such as check cashing, withdrawals with multiple denominations, account transfers, loan payments, and more.

To find out more about how ATMs play a role in a financial institution’s overall channel strategy, PaymentsJournal sat with Brendan Watkins, VP of Product Management at Fiserv, and Sarah Grotta, Director of Mercator Advisory Group’s Debit and Alternative Products Advisory Service.

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Faciliating Consumer Choice

ATMs can play a key role in facilitating and offering choice to consumers, especially Millennials. Watkins noted that ATMs are a key touchpoint for Millennial consumers, and that, contrary to the popular belief that this cohort does everything digitally, physical cash still plays an important role in their lives.

“More than anything, Millennials really want choice,” he said.

Grotta agreed, noting that Mercator research shows that Millennials do use cash and go to the ATM frequently. Research also shows that they are less concerned with paying surcharges, and more interested in choice. For example, Mercator research found that 72% of Millennials say that receiving cash from an ATM in their preferred denomination is important.

“Offering that choice is a big winner,” said Watkins. “Letting them get fives instead of tens or twenties is a great pleaser and incentivizes them to go back to that ATM.

Other ATM features Millennials deem important include the ability to receive an emailed e-receipt and accessing ATMs via a smartphone, according to Mercator research.

Specifically, consumers are drawn to cash for low-value transactions. Mercator research reveals that cash is used 49% of the time for payments valued at less than $10,