STEERING CARDHOLDER TRANSACTIONS

AUGUST 9, 2006 — 1:00pm EST (1 hour)
Ken Paterson, Director, Credit Advisory Service


This teleconference explores the topic of cardholder steering, the process by which card issuers and merchants seek to influence consumers? choice of payment vehicles.  In today?s environment, ?steering? often connotes ?PIN-steering,? the process by which merchants influence consumers? choice of PIN over signature debit.  In reality, steering encompasses a wide array of techniques, including card issuer rewards and rebates, surcharges, merchant discounts, signage, and the point of sale environment.  Issuer steering techniques can be thought of as shaping consumer intentions before the sale; merchant steering techniques, on the other hand, have the advantage of immediacy of shaping choice at the point-of-sale.

 

We will examine a number of the merchant, issuer, and cardholder components of the steering equation.  The phenomenon of PIN debit steering will be reviewed specifically, as will opportunities for other types of cardholder steering at the point of sale.  Information will be featured from Mercator?s recent report, To Steer Or Not To Steer, That?s Not the Question.