Recent J.D. Power studies indicate that while U.S. banks and credit card providers excel in digital service functionality, they fall short in creating distinctive, personalized customer relationships. Jennifer White, J.D. Power's senior director of banking and payments intelligence, emphasized the critical need for personalization in digital banking. She noted that personal financial management (PFM) tools and digital assistants represent the best opportunity for differentiation by offering tailored financial advice and enhancing user engagement.
The research shows significant interest in virtual assistants for functions such as checking balances and making payments. Adoption of person-to-person payments is also on the rise. However, consumer awareness and usage of PFM tools lag behind, with features like budgeting and credit score monitoring underutilized. White highlighted the need for banks to actively promote and integrate these tools into everyday customer interactions.
On May 31, 2024, Nacha, which oversees the ACH network, released a free tool developed by its Payments Innovation Alliance. This tool, a security incident response procedure guide, assists companies in managing security incidents and breaches. It provides step-by-way guidelines for assessing and addressing security issues involving personal or proprietary data, suggesting actions for notifying affected parties. The guide also serves as a foundation for security planning within organizations, encouraging customization of the response plans with the help of IT, compliance, and legal experts.
Matt Luzadder, managing partner at Kelley Drye & Warren LLP, highlighted the importance of comprehensive disaster recovery plans, employee training, system audits, and the use of threat detection technologies. He also mentioned the utility of integrating this guide with other resources like the "tabletop exercise" introduced last year by the Alliance.
A recent J.D. Power report revealed that debit cards are increasingly being integrated into digital wallets and have become the most used payment option when added, surpassing cash, credit cards and other methods. According to the study 72 percent of consumers use their debit card at the POS through various methods, and 68 percent of users have a favorable impression of debit over other payments. The shift towards digital wallets is partly due to enhanced security features, such as facial recognition and thumbprint technology.
The report underscores the risk of debit cards losing individual brand identity as they are associated more with wallet providers like Apple than with issuing banks. J.D. Power suggested that banks can maintain relevance by focusing on budgeting, security and rewards that enhance user satisfaction. The study, conducted from September to November 2023, included responses from 7,756 consumers.
The Biden Administration's decision to reclassify marijuana from Schedule I to Schedule III under the Controlled Substances Act marks a significant shift in U.S. federal drug policy, aligning it with the increasing state-level legalization of cannabis. This move, coupled with the revised SAFE Banking Act proposed in September 2023, signals a transformative period for banking and payment processing businesses serving the cannabis sector.
The federal illegality of cannabis has deterred major financial institutions from servicing the industry, leading many businesses to operate cash-only, posing risks and inefficiencies. However, companies like Organic Payment Gateways, Shield Compliance and CanPay are addressing these challenges. Organic Payment Gateways recently launched a payment solution for CBD and cannabis-related businesses, enhancing transaction security and compliance with ecommerce platforms like WooCommerce and Shopify.
Shield Compliance made strategic organizational changes to strengthen its role in cannabis banking compliance, while CanPay introduced RemotePay, which facilitates online prepayments for cannabis. These innovations, alongside partnerships like that between Surfside and BLAZE for advanced advertising technology in cannabis retail, illustrate the industry's technological advances and readiness to leverage new opportunities. 
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