A student can now sit at home on his or her couch and set up recurring payments, see balances, and get a detailed overview of payment history.
In 2007, registration lines at Houston Community College had reached a critical mass. As the fourth largest community college in the nation, HCC had almost 70,000 students at multiple Houston campuses, standing in long lines that snaked around the auditorium. After registering, students then moved to another long line to set up a tuition payment plan.
HCC had been using manual payment plans for years, so it was not a new concept. Even though it had low tuition rates compared to four-year universities and colleges, the population it served still needed payment plans to alleviate the financial burden. Tuition installment plans were legally required in Texas. With the size of HCC’s student body, however, the process needed an overhaul.
Easing student payment process.
It was a cumbersome experience for students. After registering, they would line up at the cashier windows to request a payment plan. The cashier would give students a promissory note to fill out. Then students and the approving officer signed it. Each transaction would take about 15 minutes, making it impossible to service students efficiently.
The Director of Student Financial Services and Cashiering Operations Nandy Baldonado and his supervisor, HCC Treasurer Ron Defalco, saw a direct need for improvement. Both agreed an automated payment plan was imperative. Nandy and Ron did a significant amount of research that included attending a student information system conference. At the conference, they explored payment platforms and spoke with vendor representatives. Nandy and Ron were looking for something flexible and adaptable to work with their existing student information and finance systems.
Cashnet provides flexibility.
They decided to go with Cashnet. It offered campuses fully comprehensible tuition plan options that easily integrated with existing portals. Cashnet provided cost-savings solutions, customized to include other options like meals and housing. It also offered students the ability to pay in installments with a credit or debit card and an electronic check. “We compared all vendor services and felt Cashnet would supply us with what we required without us having to surrender control,” Nandy said. “We needed to maintain control and flexibility for the benefit of our students.”
HCC began using Cashnet in December 2007 for the following spring term, and it turned out to be a transformative move for both administrators and students.
“It was a happy occasion when we implemented the Cashnet payment plan system,” recalled Nandy. HCC was able to double the amount of students served in the first year. At that time, there were almost 15,000 students on payment plans. With the automated Cashnet system, HCC’s plan enrollment increased to 30,000.
Giving students the option to pick classes and complete enrollment online makes the process that much easier. The lines are gone. The tension and the stress of HCC employees manning the lines have completely disappeared. “It has also helped students tremendously,” said Ron. A student can now sit at home on his or her couch and set up recurring payments, view balances, and get a detailed overview of payment history. Transactions that took up to 15 minutes now take place immediately.
Payment Plans provide long-term benefits.
Students no longer have to worry about inconveniences, such as taking a day off from work, missing an existing class, or securing childcare, just to stand in a long line. The long-term benefits are the most attractive. Students can avoid paying high interest on long-term loans, which is huge when tuition is relatively low at HCC.
Cashnet also makes it easier for administrators to transact business. At the time, there was a tightening of the budget and Cashnet helped HCC deal with it. “Had we not implemented Cashnet, we would have needed more staff to handle the lines and the reporting,” Ron said.
It even helps student retention. To date, HCC has maintained over 30,000 students enrolled in payment plans. “We use Cashnet for the entire college cashiering system,” said Nandy. “Everything passes through Cashnet. It helped us automate through the years. HCC has had such a good relationship with Cashnet, we are now moving to using eMarket for ticket sales and are in the process of deployment.”
Vice President and Payments Product Manager Don Smith said Cashnet is all about producing a positive client experience and is committed to development and product improvements. Clients like HCC will be encouraged to know there is a lot to look forward to in the near future. “We will continue to invest in our full service payment plan product to provide more comprehensive service to the school and its payers,” Smith said. “We want to ensure payment plans are viewed as an advantageous alternative to private loans or credit cards.”
Cashnet is engaging our customers with a new improved online learning portal—available now!
You aren’t growing if you aren’t learning—an important principle Cashnet applies to everything it does. In a continued effort to make information more accessible to users, our Cashnet Campus Education team has implemented an improved learning management system so users can now have easier access to self-paced training online. The portal update is part of Cashnet’s initiative to improve areas of the Cashnet platform, like the UI/UX for eMarket. It has a new look with added content, lives on an award-winning platform powered by SkillJar—and is up and running and ready to use!
Learning portal gets a refresh.
This important tool is a much more progressive and complex learning environment than the basic past portal, known as eTrain. Now we can provide a content-rich training platform that gives administrators the extra support they need so they can learn all there is to know about using Cashnet, from A to Z. Users can look forward to accessing in-depth, online information at their leisure on Cashnet modules and add-ons that include detailed slides and informative webinars.
“Cashnet is an amazing tool,” said Director of Campus Education Abbey Moore, also responsible for implementing this initiative. “I strongly stand behind its efficiency and what it can do for schools. But, if campuses don’t have the understanding of it, it is on us to put the information out there so they can take full advantage of its offerings.”
You can say that was happening with the old portal. Users were not taking full advantage of the training system. So Abbey Moore, Director of Campus Education set out to change that. But it didn’t happen overnight.
ETrain set out to fill that gap, but over time there were certain limitations that needed updating. “In the past, administrators had to request log-in information then wait for us to send it to them,” said Alex Feldman, who was Campus Education Associate at the time. “We’d send them an email with a user name and password.” They could have been waiting 24 hours. With the new portal, access is immediate. Abbey explained the old system was designed also for higher education and assumed learners were students taking college courses. “The new system is designed for a corporate environment that includes an onboarding process for continuing education.”
What users can expect.
Users can expect an intuitive interface that is much easier to navigate. They can also experience a self-serve account set up that allows them to sign in just once and be able to interact with peers and Cashnet training staff. A new commenting feature will provide communal support for questions related to the Cashnet modules.
Administrators will also have the ability to see their campus team’s training progress. All they have to do is issue a request by emailing email@example.com. We then send them a link to a reporting portal so they can run reports on staff and monitor progress.
Why is this a better portal?
“It is more task-based and focused on what are they are trying to accomplish” said Abbey. “Let’s face it, people can’t remember everything. So the whole point of site is to provide more context than a manual, to give access to users when they actually need it.”
This new training platform will be chock full of material and will constantly be updated. After moving all the content over, the project initiative is now in stage 2: revamping content. New material will be added regularly—such as webinars covering CE2016.2’s release!
Accepting online payments can be a good thing—schools can improve workflow without compromising security or customer service.
Students are changing the way higher education institutions accept payments on campuses. As payment technology continues to grow, so is the trend to replace cash with plastic in everyday transactions. Cash is on the decline and, with more schools adopting payment technology’s improved strides like virtual wallets, it will only continue.
University Business and Cashnet recently partnered to conduct a survey to explore schools’ usage of various payment methods and technologies. An overwhelming amount of respondents polled (administrators) cited cash and checks as the least common way for users to pay their college tuition. As high as that number is—68 percent—there was still a segment of administrators that expressed a payer’s hesitancy to go completely cashless. But the number is small. Administrators say these payers are simply more comfortable making payments in-person using traditional currency.
A shift in trends.
Over the past few years there’s no denying there has been a shift of less in-person payment volume. Of the respondents polled, a whopping 71 percent said they have seen a decrease in fewer students heading over to the Bursar’s Office to make their payments. What does that say? Probably that students and payers simply enjoy the convenience of making a payment online, presenting them with the ability to do it any time they want.
This does pose some concerns to university staff. According to those polled, 54 percent feel with the sole presence of online payments their offices will not be able to deliver the same high-level of customer service standards they have been able to produce in the past. There may be an alternative available to fit some schools’ needs: Instead of utilizing internal resources to handle all the functions on its own, costing time and money in training, schools could contract a third-party processor. A processor could help lessen the burden of end of-day reconciliation using patented software to ensure a payment is secure before it is passed on to the school.
This allows administrators to have more time to dedicate their expertise to other office functions or to any complicated issues that may arise. However, there are a few trendsetting campuses’ that have successfully implemented cashless programs and are not looking back. We’ll get to those details later.
Before administrators can make any of these changes to the way payments are accepted, they still feel there are challenges they need to overcome. For instance, they may feel schools need to accommodate those students who can only pay by cash or check, and those parents who wish to only pay via check and cash. The poll revealed 62 percent of administrators say some parents are uncomfortable with making payments online. Many are just not familiar with the technology, have a limited understanding, and don’t want to compromise their security—all contributing to a school’s hesitancy factor to go completely cashless.
So, how can we alleviate the fear of something new so administrators can provide payers with the most choice and the best options, while maintaining excellent customer service? Allowing other payment options like making them online through third-party payers is a start and is only a win-win for schools. There is less friction in the Bursar’s office, since there is absolutely no wait time. Payers like it because they literally do not have to stand in line and will have more control when the amount is debited from their account. And there’s no mistaking ease of use. As a result, institutions can only benefit: Payments will most likely increase and be made on time, only adding to a school’s bottom line success.
With the addition of a third-party assuming the processing, some schools can also significantly reduce their PCI scope. Third-party payers have the depth of resources and a skilled staff to handle it. Since 71 percent of those polled said they were somewhat concerned about PCI, the presence of a “PCI-certified” provider would only boost confidence and alleviates any discomfort.
Technology is about adoption.
And that requires education. Making an online payment is no more than using a credit card for a transaction. To help this segment become more familiar with online payments, schools can take advantage of the perfect opportunity to educate through traditional how-to collateral (brochures, buck slips) that further explains how easy it is to set up a secure account. Schools can also ease fears in letting payers know their offices will still be on hand to answer any questions, via phone or email, adding that personal touch many still want to offer.
Overall, embracing the technology can only enhance the services a school has to offer their students and payers. The combination of providing more choice of payment methods relieves the burden on students and payers, contributing to improved access, retention, and completion rates.
Ohio State, a cashless campus that goes above and beyond.
Ohio State has been a cashless campus since 2009. According to Tony Newland, director of financial services, Ohio State has only benefited from its cashless environment. “For one, we have had a more efficient use of staff and managers,” he said. “We’ve eliminated the need for internal cash controls and a cashiering system—we no longer count cash boxes!”
That means Ohio State’s admins don’t spend any hours to count, bundle, and deposit cash on fee payment deadlines. The result has been nothing but positive, said Tony. “The physical environment of our office is much more relaxed. We no longer have a teller barrier set-up, which I think hindered our ability to provide excellent customer service.” With a more open environment, Tony now feels there is less risk and exposure for students.”It makes it feel less US and more WE,” he said.
Customer service also improved. “We went out of our way to show a student/parent how to make an online payment instead of just giving them instructions,” explained Tony. “We have three kiosks in our lobby and our customer service staff will come out from behind their desk and sit down with a student or parent to walk them through how to make an online payment. Teach them to fish. You’ll do a service to them and yourself.”
Six Ways to Enhance Customer Service in a Cashless Office
An inviting smile puts students at ease and makes them feel comfortable enough to ask questions—and helps to alleviate the pain of paying tuition!
Show sensitivity to the student’s and parent’s needs by answering questions clearly and patiently—especially to new freshmen and international students and families.
3. Anticipate questions/provide answers.
Give students a full explanation of all options available to them. For example, a student struggling to pay tuition may not know about payment plans. You can also educate through collateral like including brochures and buckslips in mailing materials or in the orientation packages.
4. Accept many payment types.
You can offer more payment options like credit, debit, ACH, 529, wire. And when you contract with a third-party payer, simplifying end-of-day reconciliation.
5. Provide kiosks.
Assign staff to help walk users through it, if needed. The more options offered, the more convenient for the customer—and you!
6. Help the medicine go down.
Add a bowl of candy, gum, or mints to help “sweeten” the deal. Let your customers walk away with a good taste in their mouths all the way around!
The last article in our UI/UX Series explores how techniques enable a design to re-orient into a mobile-optimized layout.
The rapid evolution of mobile has delivered a dramatic shift in a customer’s purchase journey. How could it not? There are more smart devices in the world than there are people! The prevalence of smart phones and tablets has helped higher education evolve to support students both in and out of the classroom. Leveraging technology has made classes more accessible and expanded hours of operation with self-service portals. An important element of this evolution has been how payers interact with the business office. How can a higher education institution support an increasing number of payers using a mobile device to make payments? By making it easy for them.
Welcome to the 3rd installment of articles in our UI/UX series—changes to Cashnet Mobile payments, specifically for the payer-facing eMarket checkout experience! Cashnet faced its usual challenge of giving a face-lift to an old design into something more streamlined to benefit the customer. The Mobile payer-facing checkout screen needed to be more flexible in order for customers to view it on any mobile device. The old experience was not responsive, which made it difficult to navigate if the payer was using a screen size not considered for the original design. The solution? Redesign the flow in a responsive structure so we can offer an optimized user experience to all payers; regardless of screen size.
Kristie Meyer, the senior UI/UX Designer responsible for revamping the UI/UX eMarket checkout designs, was once again tapped to design updates—this time for the Mobile eMarket checkout process. It was a natural fit as she could easily apply her design principles from streamlining the payer-facing and admin-facing designs to the Mobile payer-facing design.
What is responsive design?
A responsive design is a solution that offers flexibility for your entire site layout to fit into any possible screen resolution. It is essentially a design that reinvents itself by resizing for each screen. Designers no longer have to design for each device.
How did Kristie accomplish this with the Cashnet eMarket Mobile payer-facing checkout screens? She worked with the same outside design firm she used for the other applications. “We began with the check-out screens and process, focused on the same strategy of streamlining and updating all the pages to look seamless,” said Kristie. “We also worked on making these [same] pages mobile friendly and responsive to any device.” This involved a lot of consideration to the arrangement of how the images and text will adapt to various screen sizes. As with any design project, they went through a few iterations until they found one that worked.
*Concept image shown may not represent final design.
Updates to the payer-facing checkout screen now include:
Design buttons are wider and bigger for more ease of usability
Text size is larger and consistent across the board for better readability
Order summary is not visible the entire time allowing for decluttered screens and a simpler user experience
Cashnet is dedicated to improving the payer-facing experience to make life easier and better for clients. The product team has worked hard to understand their needs and deliver the best possible solutions with a streamlined interface and an improved user experience. The changes to the checkout experience that will occur in October will remove friction making for an easier user experience. The product team will continue to roll out additional changes to the payer facing experience in subsequent releases, leveraging additional feedback from payers to influence product design.
“We are excited to invest in the payer-facing experience and evolve the technology to meet the changing and growing needs of payers,” said Don Smith, VP of Product Management. “There is a tremendous opportunity for us to improve the product for payers and to help them on their path to graduation.”
We are in the middle of a consumer revolution, and it’s changing the way we engage, interact, and communicate with payers. They want things easy, straightforward, and clear. On top of this, payers are growing increasingly comfortable and willing to share their experiences (both positive and negative) with the world (or at least their friends) through social media. As such, it is important that companies focused on ecommerce take a payer-centric approach to product development to ensure their payers are able to accomplish their desired goals quickly and easily. That is exactly what Cashnet has set out to do—turn its eMarket payer-facing checkout process into a dynamic and seamless experience. (In this eMarket version we are focusing on streamlining the eMarket Checkout payer-facing screens. The changes to the eMarket Storefront payer-facing screens will follow, and we will be announcing those soon.)
The product team at Cashnet relies heavily on feedback to ensure the right projects are prioritized, and it was unanimous that the eMarket payer-facing checkout process was much more “busy” than it needed to be. Enter Kristie Meyer, the Senior UI/UX Designer. Given all Kristie’s years at Cashnet and her expertise in UI/UX design, she was tasked for revamping this checkout experience from head to toe.
In our last UI/UX blog post, “A Marriage of Function and Form,” Kristie explained how she completely revised the eMarket store setup experience, streamlining pages, and reconfiguring to make it easier for administrative users. It will be available to campuses with the updated system release this summer.
“We needed to make this change [to the eMarket payer-facing checkout screens],” said Kristie Meyer, adding that Cashnet’s old flow is a little outdated and does not reflect some of the latest advancements which remove friction for payers. Kristie feels that it is vital for Cashnet to leverage experience from more than a decade of ecommerce evolution to gain all the important insight to get to where it is today. The goal of this new, streamlined, sleek experience is to provide the payer with more information during the checkout process while reducing the number of steps needed to complete the payment.
Use past experiences then deliver.
There’s no doubt Kristie has a love of purposeful design. It’s what makes her such a unique fit to oversee the changes and develop a more useful configuration. Her approach was holistic across the board applying the same set of Design Principles to this payer-facing checkout phase of the UI/UX changes. She also performed the same successful information-gathering exercise to research the best way to present a streamlined checkout for payers. Don Smith, VP of Payments Product Management, got his team to investigate the marketplace. “We went shopping so we could take a look at all the high-volume ecommerce experiences out there. We took note of common features and characteristics of the best to pull together the elements we felt would be most beneficial to our payers in the context of making payments to colleges and universities.”
Kristie was able to recommend a more streamlined concept. “With the old eMarket Checkout user experience, it was possible that the payer click through up to 10 pages to complete a payment,” said Kristie. “In the new design, I proposed reducing the number of pages to a maximum of 4.” She then put together wireframes and spoke with a strategic UI/UX consultant design firm out of the Bay area.
An intuitive experience.
The idea: Reduce the number of pages required to complete a payment and give users a clear picture of exactly where they are in the checkout process. The result: Seven of the checkout pages have been consolidated into one and a progress bar has been added that highlights where the user is in the checkout process.
“Payers will see their status in the progress bar and what is in their shopping cart at all times,” explained Kristie, adding that it’s one of the largest improvements of the site. “We’ve combined all of the checkout pages after the recent payment warning page into one page, which greatly streamlines things for the payer.”
“Kristie and the team have done an outstanding job. The new eMarket Checkout flow now reflects characteristics of a modern checkout ecommerce experience for the payer,” said Don. “It is an important and exciting step for us as we continue to work hard to improve the way payers use our product.”
Kristie is always on the lookout for faster and more efficient ways to make the checkout experience simpler and more powerful. “We want payers to have a positive experience,” said Kristie. “Changing the checkout flow really sets the stage and puts the payer in the position to easily make the payment.” And that’s what it’s all about: a better customer experience.
The Cashnet Customer
The customer experience can be defined as the sum of all interactions a company has with its customer. From the moment the customer enters the site to purchase completion, the goal was to:
Kristie Meyer has the ability to look at something and visualize how it can be designed better, function better, work better. Chock it up to her graphic design background. She’s an artist who sees potential in the bigger picture. “I look at things for how they should work, not how they are now,” she said. But that’s what good designers do – they look for the purpose of an item in relation to the bigger picture. “Design should be useful and practical in nature and service the purposes of others,” she said.
That’s why when it came time for us to make big changes to our Cashnet UI/UX, Kristie, a seasoned Cashnet employee who knows the nuts and bolts of our payments system, was the obvious choice to lead the job. “Kristie is well-positioned to make sure the UI/UX design is handled holistically,” said Don Smith, VP of Payments Product Management, “and to ensure we are not compromising on our vision for these improvements.”
Kristie started at Cashnet 10 years ago, and worked her way through roles in deployment, support, and eventually product. She is now the Senior UI/UX Designer. The entire time she was amassing information about our products and the various ways they are used on campuses across the country.
The larger picture.
In design, it’s often been said if you need to get a grasp on the bigger picture then you need to start small. When Kristie started at Cashnet, functional manuals had not yet been written for many of the modules, so she was tasked with writing them. And while she wrote, she saw things that could be improved. [ I would just take it upon myself] to enter enhancement requests–something related to the product that could be improved– changing existing behavior or functionality, or creating new functionality behavior.” As a Senior Designer, she is able to leverage this experience to develop plans on how the system should look, what it should do, and how customers should experience it.
“There’s no doubt the UI/UX was in need of updating,” said Kristie. She saw there was a tremendous opportunity to make things more intuitive for our users.
Kicking things off.
Things got moving in October 2014 when Cashnet engaged an industry-leading design firm in San Francisco. In daily meetings over the course of a few weeks, a strategy was defined for a significant, multi-release initiative focused on both the administrator and student user experience (UX) and user interface (UI).
One of the most important results to come from this effort was developing Design Principles (see below) to dictate all changes to our UI/UX design. Everything that would ultimately be designed for the new eMarket setup experience would now have to be evaluated against a 5-point checklist. If it didn’t meet these requirements, it was either cut or redesigned. “Basically only fields that were relevant would now appear,” said Kristie.
Kristie gathered every single page together that needed to be accessed for campuses to create their eMarket Storefronts or Checkouts. She then started researching and rearranging everything and grouping like fields together. Kristie took her product knowledge, her insight and awareness of product needs, combined them with the visual design part of her background, and put it all together. The results? A much more intuitive and efficient experience. In the new set up, campus administrators will benefit from a significantly streamlined store creation process.
Smart & intuitive.
The number of separate pages a user needs to access in order to setup an eMarket Storefront has been reduced by more than half. “An average of 21 pages were whittled down to 6,” said Kristie. This was made possible by designing more intelligent screens, which only present the configuration options associated with the goals for the user. “This enables us to streamline setup without compromising the versatility that clients enjoy with our eMarkets,” said Don. The configuration options were also reordered (and in some cases renamed) to form a more intuitive flow that will greatly reduce the amount of training for users.
What are clients saying? A validation.
Steady client feedback has always been an important part of the Cashnet philosophy. In a recent letter to our clients, SVP & GM Matt Dorf wrote how it plays an integral role in the evolution of our products and service. “Our goal is to work with our clients to meet campus needs and to pioneer the latest in payments technology,” he said.
With that philosophy in mind, Kristie took the time to curate conversations with our customers to listen and learn from them. She reached out to a group of power users who agreed to test a beta version to help think through some elements of this design, as well as validate some of the decisions that were made. “Their feedback was really positive, and they also had quite a few good ideas,” said Kristie. “We were able to make really good changes based on their feedback.”
What is UX Design?
It enhances customer satisfaction and loyalty by improving the usability, ease of use, and pleasure provided in the interaction between the customer and the product.*
Like elements have been grouped together as much as possible so it’s not necessary to go to multiple places to complete one task.
2. Present information and options only when relevant to context
As store setup selections are made, only the fields that are relevant will appear. It’s no longer necessary to know which fields can be ignored, you simply won’t see them.
3. Reduce the number of decisions a client needs to make
Users will not be asked if commonly used features should be turned on, they will be on and available for use if desired.
4. Use smart default values
In most cases, the choice that is most often selected will already be selected for you. If multiple fields only apply when one of the less common choices is selected, those fields will initially be hidden.
5. Use consistent labeling
It won’t be necessary to learn multiple terms for the same definition. Users won’t need to waste time wondering if multiple terms mean the same thing.
Changes in the .2 release are currently being completed. We will next turn our attention to the payer-facing experience that will be detailed in our next blog.
We’ve shared some of the futuristic and exciting developments aimed at reducing CNP fraud. As we discussed, these approaches are still being fine tuned to ensure that merchants can walk the fine line between mitigating CNP fraud and creating a seamless user experience. To date, attempts to implement some of these new approaches have led to false positives for an estimated 34 million consumers, costing businesses $118 billion in lost sales.1 This is steep price to pay when one considers that CNP fraud totaled $9 billion in 2015. In the meantime, there are things your campus can do today with most payment providers (including Cashnet) to make things harder for fraudsters. Here are a few of them.
Securing your online environment
Address Verification Service (AVS).
Use the integrated AVS capability to compare the billing address provided by your customer with the billing address on file with the card issuer before processing a transaction.
Card Security Codes.
Enable the field form provided for customers to enter Card Security Codes that help verify that the customer is in physical possession of a valid card during a card-not-present transaction. They are the 3-digit numbers located on the back of Visa (CVV2), MasterCard (CVC 2), and Discover (CID) cards—or the 4-digit numbers located on the front of American Express (CID) cards.
Make sure whatever company you are using to process payments on the web has velocity checking. This looks at the payments attempted. If there are too many failed attempts over a designated period of time, action is taken to automatically prevent additional attempts. This type of defense is aimed at thwarting BOT attacks, automated means of testing stolen card information.
Requiring a user to authenticate against some pre-arranged credentials has been shown to have a positive impact on reducing fraud. While some may argue that this is more of an added step than a deterrent, for most fraudsters they are one in the same. Fraud is a numbers game, and any additional steps that would reduce efficiency are off-putting to fraudsters.
This is an obvious one, but it bears emphasis. Train your staff on PCI compliance standards. All merchants accepting card payments are now required to be compliant with the requirements of the Payment Card Security Data Security Standard (PCI DSS), which sets the rules for data security management, policies, procedures, network architecture, software design and other protective measures. If a merchant doesn’t follow the PCI DSS guidelines for processing online or over-the-phone credit card purchases, it could lose revenue from the sale or payment, shipping costs, and could receive fines, similar to the chargeback fines that banks charge for bounced checks.2,3
As we’ve previously stated, there are constantly new developments on this front. Please be sure to check back here for even more information and industry insights!
In our most recent CNP post, we discussed how fraudsters have started the shift away from card present fraud to focus more on card-not-present channels1 (CNP), in part because of the introduction of EMV. The combination of the difficulty presented by EMV cards and the growth of ecommerce transaction volume has industry experts predicting that CNP fraud will nearly double in the U.S. by 20182.
Given this more pronounced threat, new methods and technologies aimed at mitigating CNP fraud are being developed/fine tuned. As fraudsters become more effective at their trade, so too must we improve the sophistication of our latest fraud mitigation strategies. It is important to note that there is no silver bullet in this effort. Effective solutions will be multi-layered. Today we share with you some of those methods that even just 5 years ago would have been too futuristic to deem realistic…but they are now, literally, at our fingertips.
Passwords are out; biometrics are in.
Think about this: Did you ever dream a phone would fit comfortably in your pocket that you’d be able to hold it up and take a high-quality photo, or a wristband could track your activity and heart rate? Or even further, that these devices would ever track your unique characteristics to validate you are, in fact, the one using them? Enter the wonderful world of biometrics; technology that measures your physical attributes—like facial features, voice, or even a retinal scan of your iris to define your unique identity. Biometrics is being hailed as the next big thing in mobile payments for convenience and most importantly, security. Currently, the most popular and main stream use of biometrics is your fingerprint to authorize a purchase when used with a virtual wallet, but that is just scratching the surface of what is being developed.
It’s all so eye opening.
Much has been made of the iris scan in recent years. Measuring the unique points in a user’s iris is considered another highly secure way to authenticate identity. Some campuses have even installed iris-scanning cameras to allow students access to buildings. Students put an eye up to a device, wait for the “go ahead,” and the door unlocks to the student center. It is said to be nearly 10 times more accurate than fingerprints since the iris image can’t be “copied, cloned, or stolen3.” Too invasive? It doesn’t stop there. Other forms of identification could soon include voice recognition, heartbeat profile, and other physical measurements and attributes that are specific to you.
Sefie Pay and Swiping.
In today’s culture of the self-obsessed photo, it seems only fitting that Mastercard and Amazon are looking at a “selfie pay” option to allow customers to use a photo to authenticate identity. All you’ll have to do is hold up your smartphone camera, take a selfie, and blink on command to prove you’re you and not your evil twin. Then buy whatever you want4.
Facial recognition can also be helpful for brick and mortar stores recording how much time a customer spends in a certain aisle, his or her emotions when making buying decisions, and simple demographics like gender, age, and race. In some applications, cameras and software can recognize specific people and cross-reference with other shopping data, like what you think of packaging and how much time you spend making decisions5.
Born with the intent to offer superstar marketers an in depth look at consumer purchasing behavior, behavior analytics are expanding to offer consumer patterns that help authenticate whether or not the online payer is in fact the person they should be. The complex algorithms look for behavior that deviates from historical data and can immediately flag events that seem irregular or suspicious and send real-time notifications of irregular patterns. The behavioral analytics look at things like how the user holds her phone, how hard she presses the keys, the usual navigation path she takes on the website, which pages she regularly visits, how long she usually spends on each page and how long she typically spends on the entire site, to name a few.
This technique replaces card data with a dummy value or numbers that are non-decryptable (i.e., “tokens”). They are unusable by would-be criminals because they have no value outside of a specific merchant or acceptance channel. Because this number is unique and different from usual credit or debit card numbers, your bank can prevent its use on a magnetic stripe card, over the phone, or on websites6. Tokenization has become an increasingly important means for card-not-present merchants to protect payment card information from hackers who want to use it to commit fraud7. If criminals try getting the card information, all they will find are a bunch of worthless tokens.
The impact of hi-tech security.
There’s much to think about with security around payment technology. Since personal features represent something you are, rather than something you know, like as a password or pin, biometrics and advanced tracking seem like the secure additions to this equation.
But with rapid development of technology, kinks need to be worked out to actually be compatible to support merchant environments (in and out of payments apps). A recent Javelin Strategy & Research study, “Overcoming False Positives” found that the increased implementation of CNP fraud mitigation strategies has resulted in false positives for 13% of payers. Since payers often do not revisit a merchant after such an occurrence, the estimated loss to merchants for false positives is $118 billion. The actual amount of ecommerce fraud in 2015? $9 billion. This staggering delta between the loss associated with false positives and the amount of CNP fraud combined with the consumer fear of loss over privacy mean that we have some ground to cover before we have an ideal, proven battle plan which incorporates these new approaches.
Visit us next week where we share what you can do now to help mitigate CNP fraud on your campus.
Hopefully you remember our EMV series covering the various elements of the EMV implementation in the U.S. and the liability shift. If not, let me sum it up for you quickly: As of October 1, 2015, the party (either the merchant or the issuing bank) least prepared for EMV accepts liability for any fraud in a card present transaction.
EMV adoption is a long way off.
If you don’t have an EMV certified solution in place at your campus, you’re not alone. According to The Strawhecker Group study, 44% of merchants thought they were going to be EMV-ready by the end of 20151, but as of February of this year, only 37% of merchants were even accepting EMV2. We have a long way to go before we reach critical mass in the U.S. EMV adoption may hit 90% by sometime in 20173.
So what’s the impact on card-not-present (CNP) transactions?
One thing’s for sure, fraud continues to grow at rapid rates. Some payment experts contend that since introducing EMV, fraudsters have reacted by shifting away from card fraud to focusing on card-not-present channels (CNP) (javelin 20164). In the next five years, the value of fraudulent online transactions will balloon from $10.7 billion last year to $25.6 billion in 2020, according to a new report from Juniper Research5. That’s a whopping number.
Fraud is definitely a global issue. Eighty countries that are currently in stages of EMV chip migration have all resulted in increased CNP or ecommerce fraud6. Take Canada. Its EMV adoption saw a 54 percent decrease in credit card fraud from 2008 through 2013, while CNP fraud jumped 133 percent over the same time period7. Wow.
Another school of thought to ponder.
Other payment experts see the spike as less of an effect of the EMV migration and more of a result of a marked increase of e-commerce volume. An eMarketer report predicts that online sales will grow from $262 Billion in 2013 to $440 Billion in 2017. That’s a 13.8% compounded annual growth rate. Approximately 73% of internet users in the U.S. had purchased products online. Furthermore, more than 61% of those users accessed the internet and transacted the sale through a mobile device; a number expected to grow to nearly 80% of online sales by 20188.
So what do all these statistics tell us?
The increase in CNP fraud has had a real impact on merchants. The rise in the United States is expected to be gradual but large. In 2012-2015, revenue loss grew from 0.6 percent to almost 1.4 percent9. Retailers incur $580.5 million in debit card fraud losses and spend $6.47 billion annually on credit and debit card fraud prevention annually10. The more attention to other payment channels like “buy online/pay in-store,” only fuel fraudsters desire to take advantage. The stakes are at an all-time high.
Growing. Growing. Growing.
Though the arguments differ, the fact remains that CNP fraud is rapidly growing. The expansion of EMV will help quell card-present fraud, but criminals will turn to another means of robbery. While the risk for higher education is still relatively low (the highly targeted items like electronics, gift cards, and jewelry are often not sold by colleges and universities), it is still important to understand the various ways to protect against CNP fraud. Stay tuned for upcoming blogs where we detail a variety of the different approaches.
Hi Everyone! We want to give you an update on our Cashnet® payment platform. It’s been a very productive time and we have much to talk about. We’ve been busy making a lot of progress and many new enhancements to help campus payments run more smoothly. We hope you are just as excited about these initiatives as we are to share them.
Our commitment to higher education.
We continue to remain a preferred payments partner for campuses nationwide and are dedicated to building upon the key initiatives introduced earlier this year, like rolling out a more intuitive and revamped eMarket set-up experience for Checkouts and Storefronts and making improvements to the user interface for payers to increase choice and remove friction during the checkout process. We think it’s important to take an energized approach to revise and streamline processes to efficiently meet campus’ needs.
We listen to our clients.
We’ve begun shipping EMV-certified hardware that not only accepts chip-enabled cards, but also supports NFC technology. And, we’ve begun work to support EMV and NFC in our Cashnet Mobile App. Our recent developments in new payment options include MasterPass to help payers complete the payment process more quickly. We are also the first to go to market with an integration that offers the ability to pay with a supported 529 plan.
What sets us apart?
Our philosophy has and always will be the consultative approach we take with our clients. We’re not just a vendor to our clients, we’re a partner. We want to hear from them. Steady feedback plays an integral role in the evolution of our products and service. Our goal is to work with our clients to meet campus needs and to pioneer the latest in payments technology.
Cashnet’s commitment to campus success is stronger than ever, and we look forward to the future! Please be sure to check our blog regularly for more industry news and product insights.