November / December 2008

All debit all the timeSM pulsationsThe Debit News MagazineSM

Focus on Participant Support PULSE’s 2008 Achievements

ULSE has just completed its 2008 “This has been an outstanding year for Consumer Debit Awareness Campaign and fiscal year, a period marked by PULSE,” said Dave Schneider, PULSE increased PIN debit interchange revenue Psignificant growth and a renewed president. “Besides continuing our strong to financial institutions for the third con- focus on customer service. The network growth, we signed a number of important secutive year. Despite these successes, we not only experienced sizeable increases in issuer agreements in 2008, launched a remain cognizant of the fact that this is a switching and settlement volumes, but has (continued on page 11) expanded its support of participants through exciting new channels. PULSE achieved 17 percent growth No Slowdown for in total transactions in 2008, compared to 2007, and a 23 percent increase in total dollar volume for the year. The network Electronic Payments also completed its first full year of opera- tion of the DebitProtectSM fraud detection he 2008 Study of Consumer Payment a little more than one-third of consumer and alert system and initiated pilot pro- Preferences, co-sponsored by PULSE payments overall. Even in the area of bill grams promoting “pay at the table” debit, T and conducted by BAI and Hitachi payment, the traditional stronghold for an exciting new payment option. At the Consulting, indicated that electronic paper checks, electronic payments were same time, PULSE continued to emphasize payments now account for 63 percent of up, with 62 percent of consumers prefer- no-cost participant services such as the consumer payments, which is up from ring this payment method. annual PULSE Conference and expanded 43 percent in 2001. Paper-based payments The study showed the average con- professional development opportunities. continued a downward slide, representing sumer makes 52 payments every month, (continued on page 9)

Revitalizing Your What’s Next for Taking Aim at Debit Program Debit? Debit Fraud Page 5 Page 6 Page 8 VIEW FROM THE TOP

Dear PULSE Participant,

n pondering the unraveling of the global economy that occurred in 2008, I am reminded of the fact that no one has a crystal ball when it comes to predicting the Ifuture. Yet, the ability to anticipate and understand the potential impact of future challenges is vital for those institutions that want to compete at the forefront of the financial services industry. As we enter 2009, I think it is appropriate to reflect on the state of the debit industry in light of the economic downturn and tightening credit market that financial institutions currently face. Dave Schneider As a payment method, debit continues to enjoy double-digit growth rates, although it is beginning to mature and some slowing of growth has occurred. I see significant upside potential for debit in 2009 and beyond, even when faced “I see significant upside with challenging economic conditions. That’s because debit remains an attractive option to more traditional forms of paper-based payments, and for many consumers it potential for debit in 2009 is an effective tool for helping to manage spending, especially when combined with the and beyond, even when many products and services financial institutions provide to consumers. At PULSE, we are “redefining debit” to help financial institutions prosper in the faced with challenging current economic climate, and to better position themselves for the future. The 2009 PULSE Conference, Debit ReDefined, is one way we will help our participants improve economic conditions. That’s the profitability of their debit programs in the coming months. Two additional components of PULSE’s effort to redefine debit are: because debit...is an effective tool for helping Focus on Risk Management – Enhancements under way on DebitProtect, PULSE’s industry-leading fraud detection system, include monthly and quarterly reporting, [consumers] to manage rules-based fraud alerts and fraud prevention analysis. spending...” Emphasis on Profitability – With PULSE, financial institutions enjoy highly com- petitive PIN debit interchange rates and low fees. Our comprehensive Interchange Analysis can show you how to maximize debit reach and boost profitability by using PULSE exclusively for PIN debit. I urge you to contact your PULSE account manager to take advantage of this complimentary analysis.

Thanks for helping make 2008 an outstanding year for PULSE. With your continued strong support, we will continue to deliver the highest possible value to all network participants.

Sincerely,

Dave Schneider President

All debit all the timeSM 2 PROFESSIONAL DEVELOPMENT Providing Professional Development and Training in 2009 n a continued commitment to keep Open to all participating financial SM participating financial institutions institutions, attendees will learn more PULSE Academy informed of industry developments about the network and how PULSE can I January Customer Segmentation and trends, PULSE will offer a wide help improve existing debit programs. range of webinars and meetings in 2009. February 2009 Network Update These sessions will provide participants 2009 PULSE Conference March Emerging Technologies with information about new and exist- The conference will feature ing payments products and services. nationally recognized speakers, a April Importance of Your EFT Below is a list of just a few of the dynamic Insights & Solutions Forum Programs upcoming events, all offered at no with payments industry leaders and June The Future of ATMs charge. debit-focused concurrent sessions. Complimentary conference registration July DebitProtectSM PIX2 Training is offered to all PULSE financial Each quarter PULSE will host PIX2 institution participants. For more September Legal and Regulatory Training webinars to provide updates conference details, see the article on Update and information relative to the auto- page 6 of this issue of PULSATIONS. October EFT 101 mated exception item system. For more information about PULSE’s November Mobile Banking PULSE Network Update professional development program, visit This new webinar will be offered on www.pulsenetwork.com. To be added to a quarterly basis to provide the latest the mailing list, contact Melissa Voelkner information about network services. at [email protected].

PULSATIONS and PULSATIONS Online Win BMA Lantern Awards

he Business Marketing Association (BMA) Houston Chapter has T awarded PULSE’s communications and marketing team with its highest honor, the Lantern Award ... twice. The Lantern Award honors break- through creative work and raises the bar for marketing communications efforts across all media. PULSE received Lantern Awards for PULSATIONS, The Debit News Magazine and for PULSATIONS Online, a Web- based version of the same bi-monthly publication. The PULSE team also received an Award of Excellence for its PULSE is Debit capabilities brochure. To see past issues of PULSATIONS (Left to right) Cindy Ballard, Rosie Van Wright, Casey Robinson, Melanie Tumbleson, or to view PULSATIONS Online, visit Anne Rhodes, Cheryl Garcia, Steve Sievert, Megan Dickerson, Erin Duplechin and www.pulsenetwork.com/pulsations. Sheryl Fish (not pictured: Ralynn Bowden, Melissa Voelkner)

3 p u l s e n e t w o r k . c o m Who’s Your CPO? By Stan Paur, PULSE Chairman

The significance of electronic payments account holder satisfaction and the compe- to the financial industry is borne out by tition. In addition to understanding the recent studies. A 2008 study by Cisco economics of the program, this individual Systems suggested that “payments” in could focus on issues such as fraud, general constitute as much as 45 percent rewards offerings and the rules associated of revenues and 40 percent of profits for with the payments programs your institu- financial institutions. One must assume tion offers. Finally, this person should that, with the use of checks declining pre- intimately understand the contractual cipitously, more and more of this income requirements of the financial institution’s is coming from electronic activity. existing network and processing relation- Moreover, nearly two-thirds of pay- ships as the financial community is offered ments are now conducted electronically. more choices and competition. The institu- Although the dimensions of the income tion’s options need to be preserved so that stream from electronic payments might issuers can select those products that be modest to many financial institutions, afford them the greatest flexibility and recently was invited to serve on the the importance of offering competitive return on their EFT investment. board of directors of a community bank. electronic payments products cannot be I suspect that few institutions today This opportunity has been a way for me I ignored. In simplest terms, a financial insti- have christened anyone as their CPO. to gain insights into the key issues and tution today, regardless of its size, must However, when one reflects on the growth challenges faced by bankers. offer an array of electronic services to of electronic payments and their economic I presume this particular community satisfy its account holders. and strategic importance, the role of CPO bank is not much different than its counter- While one might argue the relative may someday become common for more parts in terms of the topics they focus on economic significance of these new forms and more institutions. in their board meetings. The president of payment, the strategic importance of reviews financial performance and peer p satisfying consumer demand for electronic group metrics, the chief lending officer payments is undeniable. Many of the analyzes the condition of the loan portfolio current generation of account holders have and the chief information officer evaluates been raised with computers and technol- key account holder service metrics. I have ogy as learning tools. If my five-year-old 58% begun to wonder whether financial institu- granddaughter, Hannah, is representative, tions will someday regularly feature a new of readers are the next generation will be even more report on the board agenda – a report from adept at using technology. the “Chief Payments Officer.” reviewing Today, Hannah frequents a Web site called WebKinz to buy and sell things with their banking Continued Preference for Plastic “play” electronic currency. Ten years from Until the early 1980s, banks had histori- now, as teenagers or young adults, her cally been in the lending, safekeeping and relationships. generation will likely look at paper pay- deposit-taking business. More recently, – Source: Advertising Age readership survey ments the way we view rotary phones financial institutions added a new role: today – as slow and cumbersome. provider of electronic payment products and delivery channels. In the past several How Well Are Your Payments years, this role has become of enormous Performing? strategic and economic importance. One Just as various officers report today merely has to look at the focus of advertis- on key aspects of the financial institution’s ing in recent times to appreciate how operation, it may also be logical for the vitally important ATMs, debit cards, credit hypothetical “CPO” (for lack of a better cards and electronic access to demand moniker) to know how well your card port- deposit accounts have become in attracting folio is performing in terms of its return, and retaining account holders.

All debit all the timeSM 4 PULSE PRODUCT FOCUS

Discover® Network Debit Rejuvenating Your Debit Card Program 2009 PULSE® CONFERENCE n today’s troubling economy, industry enabled, issuing new cards to customers May 6-8, 2009 observers predict that consumers will who never activated their current ones Ibe looking to debit cards to help them and replacing cards that have become Austin, Texas manage their finances in real-time. Issuers “inactive.” are looking to make their debit card “Discover Network Debit offers an easy offerings the most advantageous to their approach to signature debit,” said Judith customers. The Discover Network Debit McGuire, senior vice president at PULSE. Insights & Solutions program is well-positioned as a viable “The program has increasing acceptance at option for issuers that are considering merchants across the country. With attrac- FORUM the benefits of adding a second debit card tive revenue opportunities and competitive program to their portfolio. program features, financial institutions of all sizes can experience this fresh addition to their debit Consumer Payment Preferences program.” (In-Store Payments) A key feature of the Discover Network Debit Jason Dorsey Debit 37 program is its high level of Gen Y Speaker, Best Selling Author security. While zero liability Topic: Generation Debit – They Cash 32 safeguards consumers from Aren’t Your Father’s Customers unauthorized use of their Discover Network Debit Credit Card 25 cards, the program’s 100 percent transaction authori- Paper Check 4 zation helps prevent debit fraud. Another plus – all Gift/Prepaid 1 transactions are monitored Theresa McLaughlin by the DebitProtectSM Citizens Bank, Westwood, MA Percent of Consumers fraud detection service. Topic: Building Lasting Brands in Source: 2008 Study of Consumer Payment Preferences Any financial institution the Digital Age that registers with this service will receive free Discover Network Debit is easy to use, alert notification of potentially fraudulent inexpensive to implement, secure and has transactions. the potential to deliver increased revenue. Optional security features include zero The product also encourages inactive fraud liability (not mandated on business cardholders to become active ones through cards) and identity theft defense*, offering the introduction of a widely recognized cardholders 24/7 identity theft recovery Steve Yastrow brand and new services. The program assistance and up to $2,500 in financial Author, Speaker, Consultant supports personal, business, pre-paid and relief. Topic: Cutting Through the Clutter HELOC cards. For more information about the to Connect with Customers Discover Network Debit provides an Discover Network Debit program, visit opportunity to revitalize the debit card www.discovernetwork.com/debit or call program by enabling institutions to 877-433-3248. The Forum is free with conference segment their marketing efforts. Some registration. Seating is limited. Visit *Identity theft defense not available in the state of www.pulsenetwork.com/conference examples include replacing “ATM only” New York cards with those that are signature- to register today!

5 w w w w. p w u wl s. ep nu el st ew - oe rf kt . c o m ebit is the most frequently used businesses way too much, take things guarantee I can make you so irritated with and fastest growing form of way too seriously, and need to lighten up, where you are, you’ll want to change,” he Delectronic payment among U.S. take responsibility and keep it all in said in his Oklahoma drawl. “Change consumers. Having produced more than perspective. happens when you feel uncomfortable.” $12.5 billion in interchange income for A professional speaker, author and If you had seen Winget a few years ago, card issuers in 2007, the financial impact TV personality, Winget sports designer his talk would have been much more of debit has never been greater. Given western shirts and boots in explosive tame. And, he looked like just about every debit’s importance, the industry is colors. His wrists and fingers are covered other guy on the speaking circuit. He said continually redefining debit to keep it at in silver jewelry. He exudes an appealing an old-fashioned midlife crisis helped the forefront of payments options for confidence: “This is me, take it or leave it.” turn him into the man he is today: a financial institutions and account holders. Winget isn’t a speaker who comforts colorful millionaire with plenty of irons “The 2009 PULSE Conference, Debit his listeners. Instead, he challenges them in the fire. ReDefined, promises to take your debit to make changes and take control. “I don’t “I’m unique,” he said. “And once you program to the next level by focusing on think you can motivate somebody from discover your uniqueness, no one can trends, technologies and best-in-class where they are to someplace else, but I’ll duplicate that.” issuing strategies shaping the future of debit,” said Cindy Ballard, PULSE’s Boogie Down with the Blues executive vice president of Jim Belushi and the Sacred Hearts Communications and Marketing. On Thursday, May 7, PULSE Debit ReDefined will also feature Conference attendees will be treated to an sessions on emerging debit products, appearance by Jim Belushi and the Sacred enhancing customer relationships, Hearts. The first thing you need to know preventing fraud and marketing to about Jim Belushi is that he’s a performer. Generation Y. Don’t miss this unique Not an actor, not a comedian, not a singer, opportunity to redefine your debit future! but a performer. The second thing you Details on general sessions, concur- need to know ­– and this is in some ways rent sessions and other conference events more important than the first thing – is will be posted at www.pulsenetwork.com/ that he has absolutely no shame. None. conference as they become available. Zip. Zero. Here’s what PULSE has lined up so far.

Get Personal with the “Pitbull” Larry Winget, Motivational Speaker The “pitbull of personal development,” Larry Winget, is the best-selling author of Shut Up, Stop Whining & Get a Life and The New York Times best-seller It’s Called Work for a Reason! He teaches universal prin- ciples that will work for anyone, in any business, at any time. He does it by telling amusing stories. He believes that most of us have complicated our lives and our

All debit all the timeSM 6 May 6-8, 2009

Add those two things togetherA and you uHit s the t Links i nAustin ,Te Style xComplimentary a s Conference have a pretty good working definition of Twin Creeks Country Club Registration the most indescribable of qualities known A true Hill Country golf course, Twin Registration for the 2009 PULSE as presence. And, as anyone who’s spent Creeks is located just northwest of Austin. Conference, including the Insights & two minutes with the guy knows, Jim’s The Twin Creeks designers have created Solutions Forum, is complimentary for all got it. an exceptional golf experience for every PULSE financial institution participants. From the live stages of Second City level of player. Online registration is available 24/7 at and , to the sound- “Playing this course will be what it www.pulsenetwork.com/conference on stages of “About Last Night,” “K-9,” would feel like if you just happened upon the new PULSE Web site. “Mr. Destiny,” “Return to Me” and, most a golf course carved out of nature,” Twin With the click of a mouse, you can recently, starring in ABC’s comedy Creeks Country Club designer Lee register for the conference, reserve a spot “,” he has taken every- Schmidt said of the 7,033 yard Fred at the conference forum (limited space thing life has thrown at him and hit it out Couples Signature Course. available), sign up for the golf tournament of the park. With a majority of the holes found in ($150) and make hotel reservations. A In preparation for joining their natural setting, Twin Creeks offers block of rooms at the Hilton Austin Hotel as a member of Band, ample challenges in a serene environ- is being held at a special conference rate Belushi crashed rehearsals of the House ment. You will enjoy long views of of $215 per night. The discounted room of Blues’ own band, the Sacred Hearts. He unspoiled Texas Hill Country all across rate will be available until April 6 or until had so much fun, that for the last seven the course. The fairways run through the group block is sold out, whichever years the band has been Jim Belushi and low-lying ravines cut out by twin creeks. comes first. the Sacred Hearts. You will enjoy numerous water crossings, The Sacred Hearts will get you onto unique water elements and water the dance floor with a powerful mix of hazards. rhythm and blues seasoned with a touch Twin Creeks promises to present a of soul. Belushi sings, talks, flirts, dances challenging day of golf along with plenty on table tops and does at least one back of fun and camaraderie. flip every show. You will be entertained!

7 p u l s e n e t w o r k . c o m Taking Sharper Aim at Debit Card Fraud DebitProtectSM Enhancements for 2009 espite the efforts of issuers and the • “We have been able to catch fraudu- • Researching every alert, not just those increasing education of consumers, lent transactions on cards before the that seem repetitive Ddebit card fraud instances continue cardholders had discovered them.” • Developing a checklist of questions to to increase. According to the Identify Theft • “We use DebitProtect and have found ask to root out family (or “friendly”) Resource Center, the number of breaches it extremely valuable in detecting fraud rose 43 percent last year, from 312 in 2006 actual fraud.” • Requesting a police report for to 446 in 2007. • “The PULSE system not only added reimbursements (or using signed But there is some good news. In a debit transaction scoring to our affidavits for fraud claims such as recent Fraud Prevention Roundtable held arsenal, but it catches fraud missed those provided by CUNA) at the Randolph-Brooks Federal Credit by the other systems – on average • Training multiple staff members to Union near San Antonio, Texas, issuers 15 to 20 transactions per month.” work fraud alerts and research talked with fraud experts from PULSE and suspect transactions MasterCard, and learned more about suc- Fraud Alert Registration Cuts • Requiring that every suspected fraud cessful fraud prevention techniques. The Losses instance on every card be handled by participants shared the opinion that they Not all of PULSE’s participants have a trained staff member are facing more debit fraud instances but, registered to receive fraud alerts. Some feel • Watching for multiple regional or because of faster and better prevention they are already covered through other card-not-present transactions services. Others • Staying abreast of the news – knowing have decided that what data compromises are going on, their fraud losses and where are too low to • Developing a written plan to follow justify the re- for your organization sources needed to utilize the PULSE is working to enhance the core system. Many DebitProtect product to help participants believe that debit hone their fraud mitigation techniques. In card fraud will 2009, new enhancements will include: not happen to • Rules-based transaction blocking them. (being tested now) Jim Cichy, vice • Consulting services (for institutions president, fraud that do not want to handle their own management for alerts; includes case management and PULSE, is worried fraud prevention analysis) techniques, the loss from each incident is for institutions that aren’t taking advantage • Fraud communications to designated dropping. And they agreed that using fraud of some form of fraud detection service. personnel (including e-Blasts, oppor- prevention services, along with collaborat- “There’s no doubt that fraudsters are tunities for roundtable discussions, ing with peers at events such as the one becoming more sophisticated,” Cichy said. quarterly benchmarking reports) hosted by Randolph-Brooks, are critical to “And they work fast. Compromised card • Reporting options fraud mitigation success. data can be used to make counterfeit cards • Real-time fraud alerts PULSE introduced its DebitProtect in a country halfway around the world in • Real-time decisioning fraud alerting service network-wide in less than an hour following a data theft. To • Custom model development September 2007. Many financial institu- cut losses, issuers need to get to the card- tions find it a valuable tool to help them cut holder as soon as they suspect fraud.” For more information about their fraud losses, as evidenced by these Many issuers are getting the news out DebitProtect, call the PULSE Fraud user comments: faster, and it is working. At the Randolph- Management Team at 800-420-2122. Brooks event, issuers provided insight to some techniques that are working for them, such as:

All debit all the time 8 No Slowdown for Electronic Payments (continued from page 1) DNDEBIT NEWS MINUTEM

most of them in stores. Consumers non-cash payment method. More than expected their use of electronic payment 50 percent reported credit card rewards Consumers Shift to Debit for to increase going forward, and their use of have a strong impact on their use of the Holiday Shopping checks to decline further. card, but 20 percent indicated rewards ISO & Agent In retail payments, card-based pay- have no effect. The number of consumers choosing to ments are continuing to replace both The study indicated consumer reaction use debit cards for their holiday shop- checks and cash. Since 1999, use of debit at to emerging payments is mixed. Eleven ping has risen to 41.5 percent this year the point-of-sale has increased from 21 to percent of consumers have adopted from 40.1 percent in 2007, according to 37 percent of payments. Cash has declined contactless payments, which was up from a National Retail Federation survey. from 39 to 29 percent and checks have slid 8 percent in 2005. The NRF predicts that U.S. consumers from 18 to 8 percent. Credit card use has Only 30 percent of those surveyed were will spend more than $470 billion on remained relatively constant, with only a aware of decoupled debit. Of those who holiday purchases this year, a modest slight increase in 2008, and the use of gift were aware, less than a third were some- increase of 2.2 percent compared to or prepaid cards has not increased signifi- what to very interested in it, with slightly 2007 spending. cantly over the past three years. more interested in such a program from a Three-fourths of the surveyed consum- financial institution than a merchant. ers reported they had a debit card, and 97 Overall, younger consumers surveyed Mobile Banking Attracts Small percent said their debit cards were branded expressed higher interest in mobile pay- Businesses cards (Discover, Visa or MasterCard). ments than the group as a whole, and they Digital Transactions Also in the retail sector, certain pay- were more interested in using their mobile Small businesses are far more recep- ment preferences held a higher percentage phone for contactless payments than for tive to using mobile banking services for particular merchant types. Cash contin- Internet payments. than consumers, according to a report ued to be the choice for small-ticket items. The 2008 Study of Consumer Payment by Aite Group. Drawing on findings Debit was most popular in grocery, drug Preferences is considered the definitive from several Aite surveys, the report and discount stores (which also showed guide to how and why consumers pay in indicates that 25 percent of small the highest use of checks), and credit was different venues, and how their payment businesses say they are “likely” or most frequently used for department habits are likely to evolve going forward. “extremely likely” to pay bills using stores, restaurants and gas purchases. It monitored consumer payments behavior mobile devices in the next six months, Debit was the most used payment across three primary payment venues of compared to only 3 percent of consum- method for all transactions, with 37 per- in-store sales, bill payment and Internet ers. For some purposes, small busi- cent of consumers preferring it; cash was purchases. The 2008 study is a follow-up nesses are nearly 10 times more willing second, preferred by 32 percent. Reasons to similar studies conducted in 1999, than consumers to try mobile banking. driving the use of debit included not want- 2001, 2003 and 2005, and was based on a ing to spend beyond means, ease of use nationally representative sample of 3,308 and quickness of transaction. Fear of fraud consumers in the U.S. who completed an Maryland Unemployed Receive prompted some consumers to use cash. online survey. Debit Cards Electronic bill paying is becoming more p Baltimore Examiner prevalent, with the number of monthly bills The state of Maryland has replaced paid electronically up to 41 percent in 2008 paper unemployment checks with the compared to 2005. The study indicated Known Maryland Unemployment Insurance consumers pay an average of 14.7 bills per phishing Benefit Prepaid Debit Card. The month; most of these are recurring bills Maryland Department of Labor, which they feel are easier to pay online. domains decreased Licensing and Regulation says the card Cardholders carry an average of 4.0 by more than will save time and money by reducing credit cards in their wallet, but use only 2.2 postage, paper use and staff time, and of them in a given month. Most cardholders 17% will increase convenience for people (54 percent) reported that they pay their who previously relied on check-cashing between April 2007 and card balances in full every month. Rewards services to access their unemployment cards are becoming more prevalent – January 2008. funds.

76 percent of cardholders surveyed said – Source: Anti-phishing Working Group they receive rewards on at least one

8 7 9 w w w . p u l s e - e f t . c o m Eat at the Table … Why Not Pay at the Table?

ULSE is conducting several pay at the Debit purchases are expected table pilot programs. The technology to rise 13 percent in 2008, to $1.2 P enables restaurants to conduct trillion, according to the Nilson payment card transactions at the table and Report. This continued strong accept PIN debit for the first time. growth in debit reflects consum- The program offers restaurateurs the ers’ preference for using debit. opportunity to accept debit cards conve- Yard House USA, an upscale niently and securely. The payment terminal casual dining eatery with loca- provides consumers with improved tions throughout Southern customer service through reduced wait California and more than time for check payment and table seating. 15 states, announced its pilot In addition, because the debit card never program, conducted jointly with leaves the cardholder’s hands, PULSE, in December 2008. these self-service point-of-sale During the testing terminals support finan- period, the cial institutions and company’s primary Restaurant operators are keenly restaurateurs in their objective is to see a interested in increasing productivity inside efforts to combat reduction in chargebacks, their establishments by accepting payment fraud. as well as improved cus- at the table. The pay at the table technology tomer service and benefits. represents a significant shift from the “We are very excited traditional model and makes it possible to about the opportunity to speed up service, while maximizing server work with PULSE and incor- productivity and customer satisfaction. porate the pay at the table pilot For more information about the pay at program at our Brea and Costa the table program, please contact Mary Mesa, California locations. The Alexander at PULSE at 817-698-0868 or via devices open opportunities for PIN e-mail at [email protected]. debit and other payment methods,” said Phil Crawford, chief information officer, Yard House Restaurants, Inc. Industry Leaders Join Advisory Committee $37.3 ULSE’s Financial Institution role in PULSE by collectively advising Oversight Committee recently PULSE on important issues related to billion welcomed several new members: network operations. P The value of online payments Glynn Ingram, Trustmark National Bank; “PULSE values the advice and counsel Crystal Long, GECU–El Paso; Vicky of these industry thought leaders regarding in 2007, a 33 percent Scheiderer, U.S. Bank; Konrad Schwarz, key tenets of the network,” said Stan Paur, increase over 2006. Capital One; and Chris Williston, PULSE chairman. “I thank them for the Independent Bankers Association of Texas. work they do on behalf of all PULSE – Package Facts The committee is composed of indi- participants.” viduals representing a cross section of p large and small banks and credit unions. This group plays an important ongoing

All debit all the timeSM 10 Focus on Participant Support (continued from page 1) time of tremendous challenge for financial • Guaranty Bank, a $2 billion Wisconsin PULSE released the third installment services companies, and we are committed institution, extended its participation of the comprehensive Debit Issuer Study to finding additional ways to help support through an exclusive, long-term series this year. The study, conducted by the debit programs of PULSE participants agreement. Oliver Wyman, offered network partici- in the coming year.” • Camden National Bank, a $2.3 billion pants a revealing look at financial Maine institution, joined the network. institution performance in key metrics, Participant Value as well as debit card fraud trends and PULSE continued its efforts to maxi- PULSE and Discover Financial Services issuers’ outlook for 2008. The executive mize network reliability and availability in also announced agreements with seven summary is available for download at 2008, implementing multi-protocol label additional financial institutions for the www.pulsenetwork.com (password switching (MPLS) telecommunications issuance of Discover Network Debit cards. required). technology, an upgrade that speeds transactions and creates a more redundant Continuing Programs Enhanced Communications infrastructure. This followed the imple- The 2008 PULSE Conference, held in PULSE undertook projects aimed at mentation of the active-active and local April in Las Vegas, focused on the needs of re-invigorating participant communica- node stand-in processing options, as well financial institutions to protect cardholder tions vehicles in 2008, including a redesign as transaction distributor, an application data, perform exemplary service for and overhaul of this publication in January that enhances routing efficiency. account holders and meet profit goals. and the launch of a new corporate Web site At the same time, the DebitProtect The conference featured keynote speakers in November. Participants are invited to system, introduced in 2007, helped partici- Bob Beckel and Cal Thomas, motivational provide feedback on the PULSATIONS pants spot fraudulent transactions sooner speaker Lou Holtz, a host of diverse redesign via the attached survey. and reduce fraud-related losses. To view concurrent sessions and an insightful In October, PULSE announced the customer testimonials about the product, conference workshop. launch of DebitFacts.org, a Web site dedi- visit the DebitProtect page in the Financial The network expanded its professional cated to informing consumers about the Institutions section of the PULSE Web site development programs this year, offering use and benefits of debit cards. The site is and click “Learn More.” two new Debit Performance Webcast the centerpiece of PULSE’s Consumer Perhaps most important to network Series: Simplifying Chargebacks and Debit Awareness Campaign, which aims participants, as a result of PULSE’s 2008 Charting a Course for Greater Debit to increase consumer confidence in using fee changes, implemented April 1, the aver- Profitability. PULSE also co-hosted fraud debit cards. age revenue financial institutions receive roundtables with Randolph-Brooks FCU, For more information on any of these on PULSE PIN transactions increased 6 where institutions from the San Antonio programs, visit www.pulsenetwork.com or percent. Including this increase, since 2005 and Austin areas met to discuss issuer call 800-420-2122. PULSE has boosted average PIN debit strategies for reducing debit card fraud. interchange revenue paid to card issuers by more than 33 percent.

Issuer Agreements Network expansion in 2008 was sup- ported by the renewal of several financial institution participant agreements and the signing of new issuers. Agreements announced included: • Randolph-Brooks Federal Credit Union, a $3 billion Texas institution, extended its participation in the net- work, using PULSE exclusively for PIN debit transactions and signature debit processing.

11 p u l s e n e t w o r k . c o m IN CLOSING

Walking for a Cause In support of the Juvenile Diabetes PULSE, in conjunction with Research Foundation (JDRF), PULSE Discover Financial Services, is employees took part in the 2008 Walk to proud to sponsor JDRF and be Cure Diabetes at Reliant Park in Houston. part of a nationwide effort to Teams made up of participants from raise millions of dollars to help corporations, schools and families joined find a cure for diabetes. the cause, and the walk resulted in more than $800,000 in donations for JDRF.

Seconds with... Cindy Ballard Executive Vice President of Communications & Marketing

Maintaining Confidence in Debit

Debit cards have experienced double-digit ers. A September 2008 study by Cisco Debit remains one of the most secure growth rates for more than a decade. Systems revealed that, while seniors and forms of payment available, but financial Consumers’ preference for using debit is Generations X and Y continue to trust tradi- institutions and payment service providers not likely to change, even in a challenging tional banks most for online purchases, must continue to educate consumers about economy, as debit cards are used to baby boomers – a highly profitable account the benefits and security of debit. That is purchase groceries, gasoline and other holder segment for financial institutions – why PULSE launched DebitFacts.org as the necessities. place greater trust in alternative payment flagship element of its Consumer Debit Despite this somewhat rosy prediction, providers. Awareness Campaign. there is one thing that does pose a poten- While this study represents a single data I encourage all PULSE participants to tial threat to the continued success of point, maintaining consumer confidence in consider what they can do to help alleviate debit: the possible reduction of consumer financial institutions and the payments any consumer concerns about debit. The trust in the payments system. services they offer is important – consider- PULSE Communications and Marketing Alternative payment providers such as ing that debit is a critical delivery channel department would love to hear your ideas PayPal and Google Checkout have grown for the demand deposit account relationship on this subject, as it is one of our primary significantly in recent years, and have and key to financial institutions’ profits. missions for 2009. To share your thoughts, gained considerable trust among consum- call us at 800-420-2122.

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PULSATIONS is produced bi-monthly by PULSE. Please send information for the magazine to: Casey Robinson, PULSATIONS Editor PULSE 1301 McKinney, Suite 2500 Houston, TX 77010 [email protected] PULSATIONS can be viewed on the PULSE Web site at pulsenetwork.com/PULSATIONS.

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