You need not look far to find articles and pundits proclaiming a coming revolution in the way people pay for goods and services. And you need not look far from your campus to see examples of this new wave:

• American Express, MasterCard, and Visa cards with embedded contactless chips that transmit payment data to the point of sale (POS) device via radio waves
• Peer-to-peer payment methods such as Paypal move money over the Internet between total strangers and best friends alike
• Products like Speedpass, Dexit, and PowerPay offer keychains that transmit data to gas station pumps and POS devices
• Biometric-enabled POS devices let customers pay for groceries using a fingerprint and personal identification number
• Cellphone payments are made using embedded chips running the Near Field Communications (NFC) protocol

What do each of these services have in common? They are each, in their own way, an attempt by a company to convince consumers to choose their payment tool over another. It is the competition for the “front of wallet” position, a term used in the payment industry to describe the idea that the payment card in the front gets used most often and generates the most revenue for the issuer.

Card issuers have competed for “front of wallet” position using a number of strategies over the years: reward programs (e.g. cash back, airline miles, gifts), affinity relationships (e.g. sports teams, associations, universities), and price (e.g. interest rates, fees, balance transfers).

The current battleground of choice seems to be technology. If a card issuer can differentiate an offering with a new technology, such as contactless “tap and go” payment capability, the potential to win new customers and retain existing customers grows. Similarly, if a grocery store chain can convince customers that paying with a fingerprint is more convenient or has some other associated benefit, the chance to build loyalty to the store increases.

What does this mean to a campus card program?

First, be on the lookout. New payment technologies are certain to come to campus. Through the good work of campus programs across the country, our campuses have become known as a fertile testbed for new card and payment-related offerings.

Next, it should remind us of the value and power that our institutions possess because of the relationship we maintain with our students, staff, alumni, and surrounding communities. We can facilitate access to these populations or impede it. We can issue payment devices based solely on the strong, lifelong affinity relationships that grow between students and our institutions. And we create a batch of new relationships each semester as new enrollment occurs.

New technology can be a wonderful thing, and to some extent the research and development component of the university mission suggests a role as a testbed for new products. But most of us are paid to run a business (e.g. a card program, dining services, auxiliary services) rather than conduct research. Thankfully, we can often do both as long as we keep in mind the position of strength that we possess because of the trust and affinity granted to us by the student-to-institution bond.

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