By RICHARD B. KELSKY
There’s no denying that the number of checks is decreasing.
But look at it another way: there was a time when this industry was 100 percent checks. Then came money orders, wire transfers, bill payments, payday loans, benefit payments, phone cards, lottery, transit passes, tax returns, title loans, subsidized housing, parking ticket and toll tag payments, gift cards, prepaid cards, direct deposit, prepaid unloads, gold, small dollar loans, credit card payments and bank deposits.
And the list of ancillary products keeps growing.
The fact is, ancillary products ain’t so “ancillary” anymore. Collectively, they now account for a major portion of business. Individually, some have become primary. And they all appeal to a broader customer demographic.
But the number of products alone does not ensure success. Your success with any product depends on the marketing, sales and management effort you put into it. And, as more ancillary transactions are moving to real time over the Internet, you need to change the way that you do things —right now.
Opportunity: The chance to succeed. The opportunities that new products present are huge. With each new product, you get the chance to attract new customers seeking those services, and introduce those new services to existing customers.
The key word is “chance.” Products don’t sell themselves. You can’t just take on a product and sit there.
Communicate with the outside world. Unfortunately, other than signs reflecting core services such as “Checks Cashed” and “Loans,” the industry has little experience in reaching potential new customers with broader demographics. And communicating with potential customers is the only way to get them in the door.
That requires a plan. You can start by retaining a marketing firm that has industry experience — most offer a range of support from small, targeted programs to broad, multi-level marketing. If that’s beyond your means, visit some successful local competitors and start doing what they do. Attending major trade events like the Financial Services Center of America’s Annual Conference and Exposition is mandatory: that’s where you find out what’s new in products, marketing and regulation, and what industry leaders are doing.
New products, properly marketed, attract new customers.
Existing customers need love, too. In the past, employees were your face to the customer — but after that smile and a few words, they had to be all-teller-all-the-time to protect you and your business.
Today, it’s different. Tellers need to be many things. Tellers, first and foremost, but also salespeople, supported by marketing and rewards programs, signage, advertising, multi-media, and mobile communications — and training. Training on products — features and benefits, cross-selling, what’s best for each customer, and proper handling of each type of transaction. Even with an experienced staff, this last type of training cannot be taken for granted.
Adapt policies to new products. With each new product, you will need to review your policies, and put in place appropriate operating, management, compliance, disciplinary and loss recovery policies to protect you, your business, and your customers.
These policies must be reflective of risk, both through negligence and deliberate wrongdoing. And while you’re considering risk, check your insurance to make sure that it covers things such as employee theft of monies from customer accounts and theft by misuse of services (such as employees loading their own prepaid cards).
Real time transactions. With real time transactions, the opportunities for increasing revenues, profits and customer base are endless. But remember, real time may mean that what used to be correctable mistakes (or wrongdoing) cannot be fixed today. Today, when the button’s pushed, the money’s gone.
And finding those “mistakes” can be tricky. That’s where POS integrated services can help improve accountability. Also, if your system has built-in teller reminders, use them.
Compliance. This area is expanding its reach into new products.
If your methods and systems are antiquated, compliance issues can be missed or deliberately sidestepped.
Teller dishonesty. If a card unload that’s supposed to be $200 becomes $300 (and the customer still only gets $200), very complex problems can ensue.
And if tellers load their own cards, that comes right out of your pocket.
Teller accuracy. Even assuming 100 percent honesty, accuracy is an equally important issue.
If your teller is on a cell phone or texting while handling a transaction, a $25 load can easily become $250 — in real time.
Business-quality Internet. Even if your POS system can handle transactions such as check cashing, loans, money orders, customer lookups and reporting without the Internet, you won’t be able to process other web-based transactions if your Internet lines are down or just too darn slow. Which means you need great Internet service.
That comes at a price (i.e. more than $19.99 a month for DSL that goes out every time it rains) — and that’s a price you have to pay. If you can get FiOS, get it. It’s ultra-fast and reliable. Regular cable can be OK as well, but in my experience, it can vary greatly depending upon provider, locale and speed options selected.
If you don’t know how to figure out what line to order, ask your IT professional.
Security cameras and VOIP phones suck the life out of Internet lines. So if your store is processing transactions at three teller stations, sending an electronic deposit, using two VOIP lines, streaming videos, and emailing — all while you’re watching the store through the camera system — be prepared to max out your Internet line. You’ll know when phone calls drop, camera images barely move, and Web transactions come to a halt.
You can pay someone to engage in complex load-balancing or just get the right line now to help avoid the problem. And no matter what you do, your Internet lines will go down —so be careful of how dependent you become on Web-based products, like VOIP, just to save a few bucks.
Knowledge is power. Become familiar with your store’s systems and Internet configuration. You need to understand your network, have a diagram of your network, know the components in your network (modems, routers, switches, power supplies, cables, wireless, network cards, PCs, etc.), any passwords needed to access your router or modem, and all of the relevant Internet contacts and account numbers.
Whatever you do, resist the advice of the help desk at your ISP to push the reset button on your router. It’s rarely a solution to an Internet issue — just a knee-jerk reaction of the unsophisticated support person who cares little about the damage they leave behind.
And that employee you say is an “expert” with computers? A person who turns off the monitor when asked to reboot the PC is never going to solve your Internet connection issues.
Richard Kelsky is president of TellerMetrix, Inc. a provider of POS transaction, compliance, interface, electronic deposit and marketing software to check cashers, payday lenders and retail banks. He is also a New York and Connecticut Bar member, a Polytechnic Institute of NYU and NY Law School grad, a Certified Anti-Money Laundering Specialist and a frequent lecturer on business, legal, compliance, and technology issues. He can be reached at: firstname.lastname@example.org. This article does not constitute legal advice and is an expression of opinion by the author and not of any entity or organization.