If you are a long-time veteran of the credit union industry, you might remember the days when cash, checks, and credit cards were the only means of payment – and remained so for years and years! However, even in just the past five years, the constantly evolving landscape is not only our new normal, but is expected. This is an exciting time in the payments space! The innovative services we now can provide offer significant benefits and convenience to members and staff alike. In 2019, we are looking forward to the next big thing in payments technology rolling out: Contactless EMV Cards.
Why the Time is Now for Contactless Cards
In the next five years, a potential $2.4 billion in incremental card-related earnings are projected as a result of contactless cards. Globally, this adoption already has widely occurred, creating more convenience, increasing efficiency, and resulting in a more secure payment process. Domestically, consumers complete roughly 50 billion cash transactions each year. Contactless EMV cards present an attractive opportunity to streamline retail checkouts.
Market trends clearly demonstrate that a shift is underway and accelerating toward Contactless EMV Card issuance and use. Consumer demand is strong, the POS terminals are largely in place for contactless processing, and because of significant revenue lift (up to 30% in transactions within three years), large financial institutions are already preparing for contactless payments.
The Precipice of Change
Don’t be left behind. While many of us resist change, rationally, we know that it is constant, especially when it comes to payments technology. The opportunity that Contactless EMV Cards presents demonstrates a clear ROI opportunity for issuers, but as importantly, also poses a significant risk of competitive threat. It is important to be agile and move quickly to be ready for this change to drive mass enablement. All members want to access products that save them time and make their lives easier. Early adopters aside, Contactless EMV Cards have the potential to be the next big thing that members, and consumers at large, will be actively seeking. Issuers such as FIS already have taken readiness steps to prepare institutions for this shift for their credit card programs. Enablement will start happening as early as the first quarter of 2019.
Taking the Next Step
While issuing Contactless EMV Cards won’t be immediately required, early adoption has significant benefits. The financial institutions who complete readiness and enablement steps will be ahead of the curve as part of the group of FIs who are prepared to move forward first, in turn being the first to receive the advantages of increased wallet share and transaction lift.