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Table of Contents

Lead Story

Women redefining payments

News

Industry Update

Reprieve for websites objecting to $7.25 billion settlement

DOD accuses China of cyber attacks

TSGPX outperforms S&P 500

SheerID dignifies military via discounts at golf events

Valitor ordered to process WikiLeaks donations

ETA 2013: A hub for payments innovation

Selling Prepaid

Prepaid in brief

Prepaid fraudsters busted

SparkBase finds convenience with Passbook

Views

Electronic billing and payments: green and cool

Patti Murphy
ProScribes Inc.

Taking the checkbook away, or not

Brandes Elitch
CrossCheck Inc.

Education

Street SmartsSM:
Seven reasons to love this job

Dale S. Laszig
Castles Technology Co. Ltd.

NFC - not just payment

Barry Mosteller
CPI Card Group

Ethics and sales success

Jeff Fortney
Clearent LLC

Sell what people really want to buy

Nancy Drexler
Acquired Marketing

Company Profile

Kabbage Inc.

New Products

Free POS system with mobile branding capabilities

Harbortouch/Tabbedout POS system
Company: Harbortouch

Inspiration

It takes emotional talent

Departments

Readers Speak

Resource Guide

Datebook

Skyscraper Ad

The Green Sheet Online Edition

May 27, 2013  •  Issue 13:05:02

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Taking the checkbook away, or not

By Brandes Elitch

Things are not always what they seem. This is sometimes true at the wine tastings here in Sonoma County. You taste a wine you have never tried before. You like it, so you buy a case, only to discover that every bottle tastes different.

How can this happen? Well, it turns out that wine is a living product. When it is young, it is fruity and not particularly complex. As it matures, it loses the fruitiness and gains complexity, depending on the varietal.

Also, many variables affect a wine's taste. A cork could become creased, or even tainted. A white wine in a clear bottle will go bad if it's left in even a little direct sunlight. There could be a variation in the aeration a particular wine receives, or the yeast might fail to work properly. And if wine isn't stored at a constant temperature and humidity, it could oxidize. Even the size and shape of the serving glass will affect the wine's taste.

Then there's another, troubling variable. I have seen tasting rooms pour one type of wine, and then sell - depending what they have in stock - a different year, a different blend, a different varietal, or a different lot to unsuspecting consumers, who find their wine tastes different when they get home.

It's the same thing with statistics. As somebody said, there are three kinds of lies: lies, damn lies and statistics. This applies to the payments industry, too, especially with the long-standing, concerted and well-funded campaign on the part of some to discredit the check.

It seems every time I turn around, someone is talking about doing away with checks. And sometimes, what passes for research to bolster this argument has been put together by a "researcher" with an agenda.

Fiction and reality

Now I'm going to present some claims presented at a recent payments conference, and then I'll try to distinguish between fiction and reality:

The future of checks

Now, here's what I believe is going to impact check usage. Consumers are using computers and mobile access to make purchasing decisions, both online and in the store, and this is blurring the line between brick-and-mortar and online retail environments. The credit card is the default method of paying online, and it has always been so. Consumers like mobile banking, but have shown little interest in making mobile payments. A mobile payment would most likely be made with a card, not a check.

When it comes to using a digital wallet at the POS, only 10 percent of consumers have any interest. Consumers are doubtful about the security around mobile payments; only 19 percent say that they believe mobile technology is secure for payments.

About one quarter of consumers overall, and as much as one third of gen Y (age 18 to 34), indicated that they plan to use prepaid cards as a substitute for a traditional checking account. They said prepaid cards offer more security and limited risk, can be used to make online purchases, and help with budgeting.

When you are wine tasting, it is important to take notes and compare at least five or six wines. Do this in the morning, before eating, when your senses and palate are fresh and clear. When you are reading studies of the payments industry, keep a clear head, and ask who the writer is.

Ask if the writer, or the writer's sponsor, has an agenda - it will usually be obvious. If you suspect this is the case, try to understand what the agenda is, and why it exists, before you accept the conclusions as reality.

Brandes Elitch, Director of Partner Acquisition for CrossCheck Inc., has been a cash management practitioner for several Fortune 500 companies, sold cash management services for major banks and served as a consultant to bankcard acquirers. A Certified Cash Manager and Accredited ACH Professional, Brandes has a Master's in Business Administration from New York University and a Juris Doctor from Santa Clara University. He can be reached at brandese@cross-check.com.

Notice to readers: These are archived articles. Contact names or information may be out of date. We regret any inconvenience.

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