But an August 2011 workshop at the Payment Cards Center of the Federal Reserve Bank of Philadelphia detailed why the GPR card components to transit programs generally constitute the most complex pieces of the puzzle. The April 2012 case study that resulted from the workshop concluded that prepaid's additional complexity is a product of the number of additional service providers involved in the prepaid value chain.
Tim Walsh, President and Chief Executive Officer at prepaid card program manager Ready Credit Corp., said at the workshop that one challenging aspect to the prepaid fare transit solution is the amount of customer service that must be involved, which increases the cost structure of the programs. But customer support is also vital in attracting and retaining the most profitable GPR card-using transit riders, he added.
Walsh said the five main challenges to implementing GPR card transit payments are:
2. Dealing with existing transit fare systems of disparate design and age
3. Allocating responsibilities to various partners in particular programs
4. Managing reputational risk among program participants – transit agencies, banks, payment networks, etc.
5. Handling rider confusion concerning fees and customer support
Walsh said it costs Ready Credit approximately 90 cents per minute on calls into live customer support. With the average call lasting about six minutes, the total average cost per call is $5. When factoring in how often individuals call customer support, Walsh estimated Ready Credit spends at least $20 on average per cardholder per month. In comparison, the typical GPR card provides Ready Credit between $6 and $14 monthly, according to Walsh.
But call center professionals are crucial in explaining the sometimes confusing details of GPR card programs, especially to new cardholders, Walsh said. Multiple fee schedules may apply to a single card product. And for products with multiple applications, such as a GPR card that functions as both a transit and payroll card, different fee structures can apply to different applications.
Walsh noted that customer support is important to Ready Credit's business model, as its call centers also function as customer acquisition tools. Advertising online, on television and via transit signage generates call volume, which offers customer support personnel the opportunity to inform potential customers about GPR cards and their transit and direct deposit capabilities. Therefore, the costs of customer support are offset by its usefulness as an acquisition channel, Walsh said.
He believes high-quality customer support can serve as a differentiator for consumers and help to build longer lasting relationships.
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