Debit cards are used several times a day without attracting much attention until the moment something goes wrong.
A declined grocery purchase, an unfamiliar merchant name in a banking app or a card shut down because of suspected fraud can quickly change how a customer views the institution behind the card. The stakes are greater when debit is the consumer’s principal means of payment, and there is no readily available alternative.
That puts pressure on banks and payments providers to look beyond whether a transaction technically works and consider the experience surrounding it, Justin Monk, vice president of Debit ATM and Software at FIS, told PYMNTS.
The relationship now begins with digital account opening and extends through instant provisioning, wallet access, money movement, transaction controls and fraud management.
The ease of opening another account has also changed the consequences of a poor experience. Consumers can add a competing financial relationship without formally leaving their existing bank, creating what Monk described as a “soft switch” in which customers test another provider and gradually redirect their activity.
“The big pain points in the ecosystem have been figured out over time,” Monk said.
More recently, however, consumers want to customize their experiences.
Expectations can vary by generation. Young consumers may be more comfortable with digital enrollment, instant credentials and new security features, while older customers may require more explanation or support. That complicates product development because an issuer cannot assume that every feature that improves security or functionality will be understood in the same way by every cardholder.
The optimal debit experience, then, is one in which the card remains available when the legitimate customer needs it, while security controls operate with as little unnecessary interruption as possible. That balance becomes especially important when a fraud system declines a valid purchase.
The accumulated effect of such incidents can eventually undermine the relationship, Monk said.
“This is not to say that one [pain point] by itself will cause a cardholder to go someplace else, but multiples of these stack up over time, and it adds to a level of frustration,” Monk said.
Better Data Can Reduce Debit Friction
One source of friction, the quality of transaction data moving through the payments system, sits far from the consumer interface.
“The data is foundational to all the downstream systems that utilize it,” Monk said, pointing to chargebacks and fraud rules.
Improving that information flow can help issuers make better fraud decisions, reduce false declines and prevent avoidable chargebacks. The consequences can be particularly disruptive with debit because freezing or replacing the card can temporarily separate a consumer from the money used for everyday expenses.
“In most cases, debit is the primary card that this individual uses,” Monk said. “They don’t have another debit card, or they don’t have credit, or they’re not willing to use credit. So, when you do a chargeback, and you close a card for fraud, they’re losing the utility of that card for what could be a few hours or could be multiple days.”
The challenge for issuers is also one of product cadence. Debit platforms can no longer remain largely unchanged for long stretches while banks prepare major releases, Monk said. Consumers expect smaller improvements to appear more regularly, but bringing those capabilities into production requires coordination among processors, issuers and the digital applications through which customers manage their cards.
New security functions illustrate the problem. Dynamic CVVs can help address card-not-present fraud, while linking a physical card and mobile device could provide additional authentication for high-risk transactions. Yet either feature can create confusion if consumers do not understand what has changed or why they are being asked to take another step.
Monk’s advice to the industry is to treat deployment and consumer education as part of product development rather than as work that begins after the technology is finished.
That favors a measured approach to new functionality. Instead of expecting consumers to adapt to sweeping changes in how they use debit, issuers can build on familiar behavior and introduce capabilities in smaller increments.
“Technology itself is behind the scenes; the consumer never sees it,” Monk said, emphasizing the educational component and the training of that consumer.
For debit issuers, loyalty ultimately rests on a series of routine interactions that customers have little reason to notice when they work properly. The opportunity is to make those interactions reliable enough that consumers keep reaching for the same card.
Watch the full interview with Justin Monk to learn more about:
- How issuers can decide where added payments friction is justified and where it risks driving abandonment.
- Why dynamic CVVs present an education challenge as banks introduce a security feature that changes a decades-old consumer habit.
- How pairing a physical debit card with a mobile device could provide additional authentication for high-risk transactions.
