Guest Post By Gary Singh, Vice President of Marketing at Ondot Systems.
The moment one decides to go on a vacation, they are consumed by planning for weeks before the actual trip begins. A traveler needs to book flights, hotels, restaurants and excursions to create the right itinerary for an unforgettable adventure. The last thing a consumer wants to think about is the fear of a credit card being declined because one is out of their usual routine and location. In a recent survey by Experian, 68% of people use a card to simply purchase things they need versus using a card strictly for rewards or for emergency purposes. This means that the majority of people consider cards as a main form of payment while abroad.
With all of the thought behind planning a vacation, the focus should go around the excitement of excursions and adventures, not the fear of credit card denial when trying to enjoy that first meal out of town. This is where with location-based services come in handy that take away the “vacation spending” fears with just the tap of a button on the financial institution’s banking app.
Mobile-based card controls are changing the way people use their credit cards. With the location-based services on the app, consumers can set parameters for where they are traveling to, and they can quickly turn off the card if they lose their wallet.
Location-based services are not just for travel, though. What about the everyday use? Families with teenagers know the struggle of teaching financial responsibility with the hope that their teen does not make too many mistakes. Location-based services through mobile banking apps help relieve the stress of not knowing where one’s teenager is swiping their card.
With these services, a college student can have parameters only around the college campus, a high schooler can be limited to spending only within a certain mileage of their school and a parent can get notifications every time the card is swiped. Location parameters can be changed with the touch of a button, making location-based spending one less stress on a teenager’s parent.
Location controls also provide strong protections against card fraud in the event of card fraud. Every week, thousands of consumers have their card shut off due to a data breach, leaving them without their primary payment option until a replacement card comes in. With location-based card controls, even breached cards can be used in a limited basis. Consumers can turn off card-not-present purchases and require the card to be used in close proximity to the mobile device to ensure the card is still in the owner’s hands
The stresses of card denial related to data breaches, traveling and teaching financial responsibility will soon be thoughts of the past. Financial institutions utilizing location-based card services are leading the innovation of mobile banking. As consumers dive more into mobile banking technology, the most innovative financial institution becomes the top-of-mind choice. This innovation will increase mobile payment engagement with consumers while lowering fraud incidents, securing the first choice for consumers.