Taking Checks Still a Good Idea & Other Fallout from Recent Breaches

Surprising Consequences of Credit Card Breaches

A thoughtful analysis on Pymnts. com talks about some of the unexpected “fallout” from the recent high-profile credit card breaches. One might expect that such an event would accelerate the calls for adapting more secure “EMV” card standards here, or even spark discussions on whether customers should have ever-shifting “account numbers,” etc., as a way of minimizing security risks. And those discussions have happened.

The Resurgence of Checks

On the “unexpected” side, there is a sudden uptick in the use of… checks! Yes, those analog, retro paper checks. According to the article:

“Various states are starting to pay close attention to the security of their card-based payment systems in the wake of recent data breaches. In a bit of a return to the past, they are instead sending tax returns as checks to recipients instead of depositing funds into prepaid card accounts.”

Checks Versus Plastic

It’s not that check use will return to crowd out the use of plastic, but it some arenas where plastic is still “new” — such as the area of government payments — the changeover has been slowed.

Security Breaches Slow Down Plastic Adoption

It’s not only the Target breach driving the “go slow “ approach: “Connecticut’s tax department in December decided to immediately suspend its tax-refund debit card program and issue paper checks instead, not because of a breach at a retailer, but because of a computer data breach in a systems handled by JPMorgan Chase.”

The Steady Rise of Prepaid Cards

On the other hand, the use of prepaid cards as a whole continues its steady rise: “While some states have concerns about applying tax refunds to prepaid accounts, other similar conversions from paper to plastic, such as to debit card payroll programs or the use of general purpose prepaid cards instead of cash, appear to be less affected, and that gives prepaid program managers some optimism.”

Enhancing the Security of Prepaid Cards

Of course, tempered with that optimism is a recognition that prepaid needs to be secure, too: “To help keep prepaid card vulnerability to a minimum, and to help keep prepaid opportunities viable, Visa last week said it had completed technical development of a new service designed to detect and prevent fraud schemes that target the use of prepaid cards. The Visa Prepaid Clearinghouse Service is a centralized database that allows issuers, processors and prepaid program managers to share prepaid card data. This information could include enrollments, load-funding, suspected fraudulent information and previously reported fraud on existing card accounts.”

Key Takeaways for Businesses

Embracing Analog Payments

The upshot for you?

Well, there are two upshots: Be prepared keep taking “analog” payments from your customers, which is where AVPS’ E-check  and ACH programs — as well as accepting checks by phone — are particularly helpful to you. You can keep taking “paper” payments, along with the plastic.

Security in Plastic Payments

As for that plastic, especially prepaid, AVPS still offers prepaid and gift cards, making their giving and use easy for your customers. And of course, secure.

Expand and Secure Your Payment Options

Call your AVPS rep today to find out more about additional payment options for your business, or ways to bolster security — to keep both yourself, and your customers reassured, no matter how they’re paying you!