Tapping beyond the transaction

It’s 2014 and contactless payments, also known as tap to pay, just arrived in the United States. Apple and Google introduced wallets on their phones that standardized how you could load digital instances of physical things like boarding cards, concert tickets, membership cards, and the credit or debit cards you carried in your wallet or purse. With a simple tap of your device, you could checkout at a tap to pay enabled merchant and not have to skip making a purchase just because you left your physical card at home.

And while the new digital card art and more frictionless payment experience was exciting and convenient, it didn’t dethrone the physical card. In fact, tap to pay really took off in 2018 when issuers began issuing contactless cards in earnest. In the fall of 2018 less than one percent of face-to-face Visa card transactions conducted were with a tap[1]. Fast forward to today and Visa has gone from zero to over 50% contactless penetration in roughly five years[2], with room to keep growing since 80% of Visa’s face-to-face transactions occur at a tap to pay enabled merchant[3].

It’s clear that a “Tap” has now become the preferred cardholder payment behavior for a quick, secure, and seamless checkout experience—favored over a “Dip”, “Swipe”, or “Type”.

What’s in a “Tap” for credit unions?

There’s a lot of value unlocked by a simple “tap” of a contactless card for credit unions. If you’re not already issuing contactless cards, consider this:

• Safe and secure: A tap of a contactless card is as safe and secure as a “dip” of the card using the physical chip, since both use the same cryptogram and encryption behind the chip on the card.
• Preferred checkout experience: A “tap” of a contactless card at checkout in a physical store can provide a quick and seamless experience for merchants and cardholders alike.
• Increased cardholder engagement: In the U.S., Visa data shows ~2 incremental transactions per debit card per month, and +$70 of incremental spend per month on active tap to pay cards.[4]
• Unique transaction experiences: Unlock payment experiences like “tap to ride”, where taking a trip on participating public transportation systems can be as simple as a tap of your payment card, allowing you to get on, and off to your destination. Another interesting segment is cashless tipping and donations where contactless solutions provide a great opportunity to convert cash to digital payments. For instance, The Salvation Army has begun accepting tap to pay donations at their iconic red kettles.

But that isn’t all a “Tap” can unlock for your credit union and your members. The card continues to be the center of the payment experience for your members and contactless taps promise to unlock new and secure experiences for everyone in the payments ecosystem.

Tapping beyond the transaction

What if you could take that same preferred cardholder behavior and use it to help remove friction from everyday experiences beyond in-store checkout? Now the “tap” is available in places beyond the checkout, allowing you to handle daily tasks with ease.

Tap to add a card: Is the ability to add your card to a wallet or card on file merchant by simply tapping your card on your NFC enabled smart phone. Not only is it a more frictionless experience for the cardholder, but it’s safe and secure with the presence of dynamic chip EMV data, and token support which allows a token to be stored instead of your card payment details.

Now you’re able to tap your credit or debit card on your device where a participating wallet is installed. Beats typing in your card details when you want to add your card, doesn’t it?

Tap to authenticate: Today, credit unions are at varying levels of sophistication when it comes to risk-based authentication. Passwords are often weak and One-Time Passcodes (OTPs) can be intercepted. Helping to verify it’s you who’s initiating a large dollar wire, activating a new card, or confirming your identity when you call into the member service department, are all experiences you could complete with a simple tap of your contactless card on your own device.

Tap to send or receive payment: With so many wallet options available you’ve probably noticed within your friend group, or even within your family, that everyone stores value across different preferred wallets. Because the tap of a contactless card is ubiquitous, you can unlock the ability to send money from any tap enabled wallet by simply tapping your eligible debit card to receive those funds. Imagine you’re picking up coffee for your co-workers and you’ve been given a long list of complicated orders. You decide to pay for the coffee order using your debit card. When you arrive at the office with everyone’s order, your co-workers can easily pay you their part of the order. You simply tap your card on their device with the wallet app open and the funds will transfer to your card.

This is just the beginning of what Visa can help unlock with a simple and secure tap of a contactless card. If you’re interested in learning how you can offer these experiences to your members, or you’d like to explore contactless cards for your Visa credit or debit portfolios, please reach out to your Visa Account Executive.

[1] Visanet Data, September 2018
[2] VisaNet Data, June 2024
[3] VisaNet Data, May 2024
[4]Transaction lift analysis of tap to pay active cardholders, VisaNet data, March 2022 – December 2022