Debit usage, EMV issuance up
by: Brandon Kuehl
A recent debit study found a sustained increase in the use of debit cards by both consumers and businesses in 2013. Additionally, debit program performance showed appreciable improvement last year, as consumers increasingly opted to use debit cards for transactions.
Recent data from TMG’s strategic partner CO-OP Financial Services supports this reported growth. The company found total debit card spending at selected back-to-school merchant categories for August 2014 was up more than 9 percent as compared to the same time last year.
To promote continued debit growth, issuers said they are striving to enhance current performance and make their debit offerings even more attractive. Debit rewards programs are making a comeback, often in the form of merchant offers. Specifically, 48 percent of regulated issuers now offer debit rewards programs (up from 32 percent in 2012), many of which center on a merchant-funded model.
The 2014 Debit Issuer Study also took a close look at recent high-profile data breaches’ impact on debit cards. An estimated 14 percent of all debit cards were compromised by data breaches last year. That’s up from just 5 percent in 2012. Target’s breach, which exposed account details of more than 100 million customers late last year, is no doubt responsible for much of the year-over-year increase.
“The Target breach impacted every financial institution (FI) that participated in the study, causing fraud loss rates to increase in 2013 and compelling issuers to re-evaluate their strategies for improving card security in 2014,” the researchers wrote in a press release.
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