This fall, millions of families will be sending their children off to universities. One feature that some of them may encounter is the Campus Debit Card, which is a student ID that also doubles as a debit card. Unlike similar cards issued in the past, these cards carry Visa and MasterCard logos and can be used in any store that accepts cards. Previously, many campuses had reloadable debit cards that were accepted by a limited number of nearby merchants.
Merchants should be on the lookout for these cards and familiarize themselves with the appearance and features of the cards. Because they double as student IDs, there is a built-in anti-fraud component. Normally, these cards should process just as easily as credit cards, prepaid debit cards, and other card-based payments. The upside to these cards is that they may represent the first plastic-based payments available to students who previously operated on a cash-only basis. Therefore, stores near campuses may notice an uptick in debit card sales.
Is there anything that college area businesses should do to be ready for these cards? The biggest consideration would be to have PIN pads for debit card transaction approval. While many debit cards can run as “credit” when a PIN pad is not available, merchants can realize significant cost savings on every transaction if they use a PIN pad to verify transactions. There are also fewer chargebacks and fraud disputes from PIN-based debit transactions, since the cardholders have to know the personal identification number associated with the card itself. Capital Processing Network can help your business upgrade to terminals and PIN-pad peripherals that can save you a significant amount of money on processing and merchant account fees.
Other college debit cards may be issued in lieu of a check for financial aid and student loans. While there is quite a bit of controversy as to whether cards like these should be issued for students, and whether the fees charged to students are too high for transactions and overdrafts, the fact is that universities stand to make millions off the use of such cards. Budget crunches have his public universities all around the US, so many of them have a financial incentive to issue these cards to students. As a merchant, the ability to accept debit cards, and get the best transaction rates, may be too beneficial to be ignored.