Magazine article Marketing

News Analysis: Transactional Hitch

Magazine article Marketing

News Analysis: Transactional Hitch

Article excerpt

As the chip-and-PIN deadline looms, banks and retailers are not doing enough to inform consumers.

For many people, 14 February means chocolates, flowers and possibly a romantic dinner for two. This year, for anyone buying goods with a credit or debit card it means a little bit more, as Valentine's Day will be the last day consumers can use a signature to verify transactions on chip-and-PIN cards.

With a month to go until one of the biggest changes in UK payment systems is finalised, consumers seem unaware of the extra significance of the date.

Apacs, the UK payments association behind chip and PIN, says it is conducting a PR campaign to raise awareness. 'We've made quite an effort already,' says Apacs director of corporate communications Sandra Quinn. 'About 99% of the UK population hold at least one chip- and-PIN card and only a minority are choosing to sign rather than use their PIN number, so there is no point in running a big campaign,' she adds.

Rupert Pybus, joint managing director of financial advertising agency cchm:ping, believes that the majority of UK consumers are not familiar with the 14 February date and most won't realise that they will not be able to sign for their purchases. He further believes that PR will not be enough to talk to such a large audience. 'More broadcast, press and TV work would be appropriate in communicating such an important message to a wide audience,' he says.

Consumer education

Chip and PIN is not averse to advertising as a medium to raise awareness.

In March 2004, it launched a TV campaign, by Saatchi & Saatchi, to promote the technology's introduction.

However, as the project nears completion and the majority of consumers are already using chip and PIN successfully, Quinn asserts that PR is more relevant. To support the PR, banks and retailers are highlighting the significance of 14 February through point-of-sale, direct mailings and internet and email alerts.

The major banks are all sending reminders to consumers with their regular mailouts, and including the information on statements. They are also training staff to educate customers, particularly those currently choosing to sign rather than use their PIN. The banks know which customers are habitually failing to use their PIN and can easily target these people, according to a chip and PIN spokesman.

Retailers are erecting posters and staff are reminding customers that they will not be able to sign for chip-and-PIN purchases from next month.

'We are not anticipating big problems. Many people volunteer to pay with a different card if they can't remember their PIN (for one),' an Asda spokesman points out.

However, the National Consumer Council (NCC) and charity for the blind RNIB are not so sure. They have criticised chip and PIN, retailers and banks for failing to publicise the alternative 'chip and sign' card for consumers with physical or cognitive problems.

Many people, particularly those with cognitive disabilities, have trouble remembering PIN numbers, according to an NCC spokeswoman. 'Banks and chip and PIN may have underestimated the scale of the problem. The public must be aware of the alternatives and banks must know their responsibilities,' she adds. …

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