ST. PETERSBURG, Fla. – Credit unions should aim to put debit cards into the hands of at least 80% of their checking account holders and to get at least 65% of checking account holders to activate and use their cards. That is one of the conclusions of the Evolving Payment Systems Market white paper on debit issuing researched and published by Card Services for Credit Unions and Raddon Financial Group. The white paper recommended strategies credit unions can adopt to help reach those goals as well as different techniques credit unions can use to boost debit usage. The paper also warned credit unions to evaluate their business partnerships closely as there has been a lot of consolidation among networks which rely on personal identification numbers to validate transactions. "More specifically, financial institution ownership of the EFT networks declined to 29% in 2001 from 91% in 1996," the white paper noted. "Such a `merchant-centric' versus `financial institution-centric' shift causes financial institutions to re-evaluate their ATM and POS network relationships with respect to acceptance for their cardholders and to maximize revenues and expenses as appropriate." Specifically, credit unions should consider affiliating with the PIN-based networks that Visa and MasterCard own as a way of making sure they continue to get the best possible interchange and other card fee policies. When it comes to issuing more cards, the paper recommended credit unions that have not already done so convert their ATM-only debit cards to multifunction cards that carry the Visa or MasterCard logo and which consumers can validate transactions using their signatures. This approach generally means educating members about their protection from fraud loss and bringing them to trust the multi-function cards. Credit unions should also routinely package debit cards with their new checking accounts. Everyone qualifying for a checking account should qualify for, and receive, a debit card, the paper instructed. Getting cardholders to activate their cards likely means training staff to educate new account holders about how and where they can use their cards and may include offering incentives to get new cardholders to activate their cards, the paper said. The paper advised that credit unions consider implementing a points-based rewards program that can help build debit card usage. Although only 40% of debit card users surveyed overall said a rewards program would influence them to use their debit card, moderate debit users were split on the idea and over half (55%) of heavy debit users said they would increase their card use if their card carried a reward program. The paper quoted rewards program specialists with Certegy, who claimed, within a year of implementation, a "well positioned" debit rewards program will see a 10% increase in the number of debit cards issued, a 5% increase in the number of active debit cardholders, an increase of almost five transactions per month per card on average and an increase of $5.00 per average transaction amount per year. [email protected]