From card breaches to settlement services, this week, CreditUnions.com turns its gaze upon payments.
Here are five can’t-miss data points.
$100 – $150 Million
For many, a card breach is the nightmare scenario. For instance, Capital One is expected to incur $100-to-$150 million in breach-related costs for customer notifications, credit monitoring, technology costs, and legal support from its recent breach. That’s just one high-profile example. In reality, cardholders don’t care whether an incident is a high-profile breach or an isolated attack. They expect immediate action, fast resolution, and clear communications. According to the experts at Wright-Patt Credit Union, the best way to respond to a card breach is to be prepared before it happens. Here, they share best practices for handling card breaches and helping members avoid them.
Read: 6 Steps To Prepare For A Credit Card Breach
As credit unions head into strategic planning, every credit card issuer should plan to regroup and prepare. Many of the positive forces that have supported credit card programs since the last recession will not continue into 2020. In fact, the coming year could be the toughest year for issuers since the end of the Great Recession. Adequate planning for 2020 and beyond will require a realistic view of what all credit union credit card issuers will be facing. That realistic view includes some difficult truths; however, a well-managed credit card program can still yield strong results for the loan portfolio. First, the bad news and then the bright side.
Read: A Warning For Credit Card Issuers
24 x 7 x 365
In terms of expectations, the American consumer is running ahead of the payments engines that help drive their everyday financial lives. That explains the let’s get going tone among some in the financial services world to the Federal Reserve’s recent announcement that it plans to develop FedNow, an around-the-clock real time payment and settlement service. In its Federal Register posting, the Fed describes FedNow as a new interbank 24x7x365 real-time gross settlement service with integrated clearing functionality to support faster payments in the United States. The Fed doesn’t expect the service to be up and running until 2023 or 2024. Of course, there are multiple major stakeholders in the payments space, and their views on FedNow vary. Here are their perspectives.
Read: Is It Time Now For FedNow?
The payments landscape looked much different in the not-too-distant past. Within the last decade, consumers were primarily paying other consumers with cash and checks, while paying merchants with cash, checks, and cards. Fast forward to just a few years ago and a much different picture emerges. A class of fintechs has materialized with varying focuses ranging from mobile payments to loyalty. The rise of these non-traditional players has many financial institutions concerned. Taking advantage of these shifts is where the industry is headed. If credit unions were to size up their competition, they would see that big banks have deep pockets and seemingly unlimited resources. However, what the big banks lack is the ability to quickly innovate and adapt to the rapidly changing landscape. Credit unions are uniquely positioned to be more nimble and respond quickly. Here are three key areas credit unions should consider when it comes to the future of payments:
Read: The Future Of The Evolving Payments Landscape
From hurricanes to fires, tornadoes to floods, credit unions operating in the United States face the threat of natural disasters on a regular basis. Factor in the human element, and the nation’s cooperatives must remain continually vigilant. But in the shadow of the worst-case scenario, credit unions rise to be the best resource they can be for their members, communities, and more. This Callahan Collection brings together twelve industry stories on how to deal with disaster while adding a human touch to financial services.
Read: Disaster Response