2015: What to Expect – Opportunities and Disruptors

Bob Legters
Chief Data Officer of Banking and Payments
Posted on March 5, 2015


2015 is going to be a big year. With EMV™ on the way, there will be a multitude of opportunities and challenges facing the payments industry. In addition, advancements in technology will open more doors for alternative payment methods and new payment programs. Each of these frontiers will be met with the question of whether they will help or prevent security breaches in the future.

Let’s explore a few of these frontiers.

Chip Cards

One of the most talked about payment changes is the Payment Networks’ Liability Shift associated with EMV, which will take place this October in the United States. With that deadline fast approaching, financial institutions and other companies can no longer procrastinate in the planning for chip cards – it’s time to add a chip migration strategy to the top of your task list. First, consider how your card reissuance strategy works and how to educate your customers about EMV. Retailers and merchants, meanwhile, need to make sure they have the infrastructure ready to accept chip cards.

Payments Growth

The cost of offering payments programs continues to increase.  As if the regulatory changes, security requirements and chip migration weren’t enough, the need for innovation and speed to market is making its way to every payments discussion table. The increasing demand to meet the mobile and alternative payments market is growing.  Maintaining relevance requires every issuer to have multiple strategies that complement their baseline growth strategy. Innovation is not dependent upon consumer adoption. However, in order to achieve growth, success and more revenue, consumer adoption of these advancements must ramp up.

So what should an issuer do to remain relevant with their cardholders? Financial Institutions need to focus on growth and should push for more accounts in their debit/credit/prepaid areas through basic acquisition strategies in combination with new approaches. It doesn’t always take innovation and new technologies to grow, but it does take thinking differently. Focusing on the current product offerings, analyzing the portfolio and honing in on them with basic blocking and tackling will reap growth.

Recently, a sit down with the AVP of Coasthills Credit Union helped us look into how one financial institution overcame these challenges and stayed profitable. What strategies did they implement and how can you use their lessons? They focused on planning to stay ahead of the curve and obstacles. They focused on targeted marketing activities and kept the lines of communication open to their consumers regarding their products. The takeaway is that growth comes to those who are willing to take an honest look at their business model, uncover the inefficiencies and create a plan of action to make change.

With so many changes happening to the payments industry, it will be very interesting to see how it continues to evolve into 2015. What do you think will be the biggest change to come in 2015?

Leave a Reply

Bob Legters
Chief Data Officer of Banking and Payments

For the past two decades, Bob has focused on products and services support for clients. He has spent 17 of those years in a leadership role with groups ranging from 5 to 200 employees. Bob’s unique experience allows him to efficiently operate at a level that exceeds the normal executive role of understanding and recognizing client and consumer needs in the payments space.