INNOVATION + LEADERSHIP
Partial Approval, Full Customer Satisfaction
will be speaking at:
April 09, 2012
I often find myself giving MasterCard prepaid cards in lieu of cash or checks for gifts and other purposes (e.g., spending money for my children when they travel). The obvious benefit of course is the opportunity to use the card wherever the MasterCard brand is accepted. As a user of prepaid cards as well, I know that one of the challenges is keeping track of the available balance, especially if there was a fair amount of value originally loaded onto the card.
In my early days at MasterCard, I received a call from one of my larger retail clients expressing concerns that the time it takes for consumers to checkout may increase because more prepaid cards were being used and, at times, it was creating a log jam at checkout because the customer did not know the value remaining on his or her card. I can only imagine how uncomfortable it would be if I was that person holding up the line, especially if it was getting close to closing time. The extended checkout time was being caused by the fact that the retailer had to attempt multiple authorization requests until they finally received an approval from the Issuer. Although the retailer understood the benefits of general purpose prepaid cards to drive sales, they did not want a positive turned into a negative because of the inability to check the balance on the customer's card.
I'm pleased that MasterCard has solved for this issue by now providing Issuers, Acquirers and Merchants with the capability to conduct Partial Approvals so that the purchase experience using a prepaid or debit MasterCard card remains a positive one for the consumer and merchant. With partial approvals if the card does not have enough funds on it for the purchase, they can continue the transaction and pay for the remaining balance with funds from another source. Sounds simple but in actuality it is a complex problem that requires an innovative solution. The effort involved working with multiple stakeholders both within MasterCard and externally, to ensure our approach delivered on the ultimate goal of providing a more positive purchase experience for the consumer.
MasterCard's integrated solution actually involves three transaction types—call it the triple play of successful prepaid/debit card processing:
All of the stakeholders in the value chain (i.e., Acquirers, Processors and Merchants) should continue to support the implementation of this valuable solution. Creating an enhanced purchase experience for the cardholder/consumer as they continue, more and more, to use prepaid and other debit card products can only help drive increased sales (and greater adoption of card-based/electronic payments).
I appreciate the opportunity to share my perspective on prepaid/debit card payments and of course welcome your comments and insights.