Instant-issue cards may seem like old news, but if Centier Bank's recent implementation of EFT Source Inc.'s platform is any indication, the technology is still helping banks increase transactions and interchange revenue, while lowering card production costs.
The northern Indiana bank implemented EFTs Card@Once system in January. The technology allows plastic cards to be printed on the spot when a customer visits a branch, eliminating the need for the bank to send the card and PIN in the mail, which can take up to 10 days.
In the first month after deployment the banks activation rate the percentage of users conducting a transaction within the first month of receiving the card jumped from 74% to 87%.
Six months into the integration, Centier has increased consumer transactions by 28% and total interchange revenue by 45%, from April to July, says Jeremy Miller, regional vice president at Centier Bank. The banks card activation rate also rose 16%, he says.
Customers are using the card more often and frequently because its in their hands sooner, says Miller. Before installing EFTs instant issuance technology, on average we were seeing about 20 debit card transactions per card per month but thats up to 28 or 30 since installing the printers.
In the month of July, Centier printed 2,038 cards, 476 more cards than it printed in April.
In April, 58% of consumers used the instant-issue cards within the first eight hours of leaving the branch. And although that number dropped to 44% when calculating over a three-month period, the rate is still high, says Miller, and thats the basis of any successful debit card program.
The bank also saved more than $7,300 in card production costs over the three month period.
Traditional plastic cards cost about $3.15 to issues, while instant-issuance cards cost around $2.50, says Miller. Youre eliminating the postage of both the card and the PIN that in itself is about 80 cents, he says.
Plus, now that Centier has instant issuance, it never has to pay a delivery service for rush-order clients.
EFT charges a small setup fee and a volume-based monthly charge. The financial institutions also pay for printers, although the price per unit decreases depending on the quantity purchased.
Before EFTs software as a service, financial institutions hesitated to provide instant issuance because of the upfront software and hardware costs and difficult integration associated with the technology.
EFTs software as a service integrates with Computer Services Inc.'s core banking system. Because the system operates on EFTs network, clients dont have to develop or manage the infrastructure, something financial institutions had to do in the past.
The instant issuance software and hardware is issued on the spot with little effort and IT services from the financial institution in 15 minutes its up and running, says Bill Dinker, president at EFT.
Centier decided to launch instant issuance after seeing increased competition from JPMorgan Chases instant issuance service, Miller says.
Centier chose EFT primarily because it was almost a plug-and-play, Miller says. The caveat is that its not only the new customer thats wowed but our existing customer base could be wowed if they lost or broke their cards.
More than 500 locations in the U.S. use EFTs instant issuance technology. EMV chip-cards can also be printed using EFT Sources technology.
We anticipate being in the four-digit area in terms of deployment in the next six to nine months, Dinker says. EFT plans to sign partners in the Latin American and South American market soon.