While covering the debit card market for Mercator Advisory Group, I am always on the lookout for new products that can encroach on debit’s territory and may, someday, represent a threat. For several months I have been discussing the rise of decoupled debit. My report on the topic can be found here. Decoupled debit is the mobile or card based payment option that is merchant issued. Decoupled debit can be used only at that merchant’s locations and uses ACH, not the card networks, to deduct the value of purchases from consumers’ checking accounts. What the merchant saves in processing fees and gains in customer loyalty is passed back to users in the form of purchase discounts. A press release highlighted on Payments Week announced yet another decoupled debit program:
P97 Networks and Buy It Mobility Networks(BIM) announced they have struck a deal with customer Phillips 66 (NYSE: PSX) to provide ACH based payment and consumer engagement services at Phillips 66®, Conoco® and 76® branded locations. The program will rely on BIM’s advanced technology to expand the capabilities of P97 Networks’ PetroZone® Mobile Commerce Platform and provide Phillips 66®, Conoco®and 76® branded consumers with a fast, easy and secure way to link their checking account to Phillips 66’s mobile payment offering.
Phillips 66’s mobile branded debit program will now operate via BIM’s white-label ACH platform, enabling faster consumer enrollment, increased consumer loyalty and engagement, consumer authentication and risk mitigation to dramatically reduce fraud, and guaranteed transactions that settle the next day to Phillips 66.
Gas stations and associated convenience stores have been the hot-spot for decoupled programs, but any retailer that attracts frequent, recurring purchases like QSRs and grocery, are targets as well.
Overview by Sarah Grotta, Director, Debit Advisory Service at Mercator Advisory Group
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