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Article: Where are the profit opportunities for banks that issue debit cards? (eight bank industry officials discuss their debit card business)
- Article from:
- American Banker
- Article date:
- June 21, 1993
CopyrightCOPYRIGHT 1993 SourceMedia, Inc. This material is published under license from the publisher through the Gale Group, Farmington Hills, Michigan. All inquiries regarding rights should be directed to the Gale Group. (Hide copyright information)
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The whole idea of debit cards becoming more of a profit center has evolved as banks have been searching for more avenues of non-interest income. The natural tie-in was this plastic card already in the customer's wallet. Banks started asking themselves: "What added value can I place on this card that would bring me opportunity for fee income?"
The answer was point of sale debit. If you deliver value - extra services - the customers are willing to pay for it. For example, we did a study that showed that 60% of our Visa Debit issuers - we have over 800 - charge either a periodic or a transaction fee for the use of that card.
Banks should not underprice ...