Community financial institutions play a unique role in the spectrum of financial services providers. They are an integral part of the communities they serve, building long-standing relationships with consumers and businesses.
While community banks and credit unions tend to be smaller organizations with limited resources, they can still compete effectively when it comes to offering digital payments, says Steve Sievert, PULSE® Executive Vice President of Marketing and Brand Management. Sievert recently joined Dave and Tanner Mayo, founders of FedFis, on their Fintech Cowboys podcast to discuss how community institutions can succeed in digital payments.
“Investments in the industry have given consumers the confidence to utilize debit in the card-not-present space.”
Steve Sievert, PULSE Executive Vice President, Marketing and Brand Management
Encouraging debit use in digital channels
The pandemic acted as an accelerant for digital payment adoption.
“Industry investments have given consumers the confidence to utilize debit in the card-not-present space,” said Sievert. As a result of enhancements in areas such as fraud mitigation strategies and authentication technology, consumers are choosing debit more often than ever for peer-to-peer payments, online bill payments and other recurring transactions.
Community institutions can gain the most from this trend by encouraging cardholders to use debit in new environments.
“Speak to the consumer about the ‘why,’” Sievert said. “Tell them how your institution’s service makes their lives easier, saves them time or reduces payments friction.” He recommends tying those messages into bill pay or recurring payments. Cardholders will be well served if they use their debit card as their recurring payment for monthly subscription payments. They can “set it and forget it,” he said.
“Science tells us that 40% of what we do each and every day is habitual. That’s where setting a debit card for a recurring payment comes into play.”
PULSE and Discover® have a Set it to Debit® marketing campaign they make available to debit issuers to help them in this regard.
Building account holder loyalty
It is important for financial institutions to continue to emphasize why debit is important, even with your power users, said Sievert.
“There is a competitive advantage that community banks have where fintechs can be challenged to compete in an authentic way – investments that you’re making in community and support of local businesses,” he said.
He recommends that community institutions focus on striking a balance between relationships and solutions.
“For a community bank to be successful today, it has to be able to do both. Consumers don’t have to have every single technology enhancement on, for example, your institution’s mobile app. But the app has to be good enough to help them solve problems and remove friction in their life. If you can strike a balance between delivering the solution and delivering in that ‘relationship moment,’ it is much more likely they will be a brand advocate for you,” he said.
For more information about how PULSE can support your institution’s digital payments needs, connect with your Account Executive or a PULSE debit expert.