There are 6,000 people at this year’s AFP (Association of Finance Professionals) conference in Boston, and it feels like half of them must be smashed into this morning’s session on “The Retail Merchant’s Customers’ Payment Options: Deciding Between C21, BOC, ARC & POP”.
Peter Nash of CVS, Charlie Labassi of Home Depot, and Delores Ratliff of Target went through their decision processes in looking at the various options. All of them had done a fairly complex evaluation process, looking at hard and soft costs and benefits.
Considerations included the customer experience, bank fees, float, fraud impact, returned item processing, and, significantly, demands on store staff – at the POS and/or in the back office. Concern over cap-ex loomed large, especially given declining check volumes.
- For CVS, POP check conversion is the winner – but they are still deciding whether or not they will image the checks at the point of sale. Peter also cautioned that a low ticket average and low fraud rates at CVS were governing factors.
- For Home Depot, the answer is BOC – but totally outsourced to a bank provider, thus eliminating any back office or cap-ex burden.
- For Target, the answer was also BOC, but on a very different model, with more components of the process being handled in-house, at a centralized location.
The companies are all still in early pilot/implementation stages with their choices.
Obviously, this is the big merchant’s perspective. Walking on the exhibit floor, the huge popularity of C21/Remote Deposit Capture solutions for smaller merchants is obvious.
My conclusion? There isn’t going to be any clear winner among merchants – all of the approaches have their adherents.
Perhaps the most interesting comment was Peter Nash’s remark that “we don’t have much control over credit or debit card acceptance costs – but with checks, we still have some choices!”