FlexATM Key Benefits
Simplified management of the ISO 8583 standard.
The language of debit card and ATM card transaction processing relies on the ISO 8583 format, a communication standard supported by all network processors. The standard provides specific criteria associated with data elements such as account number, dollar amount and terminal location. However, each network makes use of various optional fields to modify this standard and better serve its business purposes.
Because each network uses an adapted ISO 8583 standard, vendors who connect with the network must develop an interface to properly handle the exchange of data between the two entities. Each interface must be rigorously tested to ensure all data elements contained within each message are handled correctly. As changes to the message standards emerge – from industry mandates, Visa/MasterCard requirements, or individual network enhancements – the earlier interfaces must be modified, tested again and deployed. The resources allocated to supporting ISO 8583 variances for major network processors can be significant. It is understandable that core banking vendors often charge substantial fees when implementing an ISO interface.
A key benefit with FlexATM is the removal of the complex ISO 8583 interface from core banking vendor responsibilities. As FlexATM consumes both point of sale and ATM transactions, the data elements necessary to the core banking system – checking/savings account and dollar amount at its most fundamental – are collected and presented in a format more easily managed by the core banking system. By reducing the complexity and resources required of the core vendor application, interface costs can be dramatically reduced.
By separating the ISO 8583 language from core banking system responsibilities, FlexATM also provides portability. A client financial institution can interconnect essentially any debit card network with any core banking vendor at a fraction of time and cost with the open architecture of FlexATM. A client financial intuition can move from one core banking application to another without disruption to its debit and ATM card processing channel, or move from one debit card network to another without involving the core banking vendor for real time debit card and ATM processing concerns. Not only does FlexATM overcome technical challenges when connecting disparate systems, but business issues associated with vendor competition can also be mitigated.
Added value as cardholder activity increases over time.
A substantial source of revenue for many banks is the interchange fee that is received from cardholder activity. An interchange fee is a small percentage of each transaction which the cardholder’s bank earns for accepting card-based transactions. Because each financial institution earns its fee income on a transaction-by-transaction basis, it has become customary to see most vendors in the debit card processing arena also charge some portion of its fees by counting transactions.
In contrast, FlexATM continues to deliver real-time processing with either a flat monthly or simple annual fee structure. Not only does this make for an easier budgeting effort, but growing interchange fees resulting from increased cardholder activity allows the bank to retain an even greater share of its earnings over time. Debit card use in 2017 made up 66.9 percent of card payments. Furthermore, debit card activity from 2016 to 2017 has surged to a 10.4 percent growth rate – well above the 6.8 percent growth rate reported in the 2015 to 2016 period. This upward trend should be part of any consideration when evaluating the long-term cost/benefit of FlexATM processing. To learn more about the increasing use of debit cards, download the Federal Reserve study here.
Consistent cardholder experience.
Core banking systems have varying operational procedures: end of day processing to settle all accounts, system maintenance, non-standard business day times, even unexpected performance disruptions. Regardless of the reason, cardholders depend on their point of sale and ATM transactions to be accomplished at any time and from any location.
FlexATM delivers a wide array of processing solutions to meet cardholder expectations, regardless of back office operations. All communications between both the core system and debit card network are processed with “interleaved” messaging, a multi-threaded protocol which ensures any delay to one message does not affect other messages in the queue. Delays associated with core system sector locks or the processing of a store and forward stand-in file are examples where interleaved communications are solved by FlexATM.
Planned downtime for core systems can remove the ability to process transactions “live” against account balances. To prevent disruption, FlexATM can perform temporary authorizations until the core banking system is available once again. Cardholders do not see a difference in their transaction approvals or balance inquiries; once the core system is available, FlexATM forwards any stand-in authorizations to ensure consistency across other banking access points.
Security and performance.
Atris Technology is a SOC 1 Type 2 audited vendor and deploys FlexATM to follow PCI-security recommendations. Furthermore, FlexATM can be deployed directly at the financial institution to ensure cardholder data and transaction processing is within the control of the financial institution and its internal security policies. This configuration lessens the demands of examiners who scrutinize vendor relationships where data processing of confidential customer information is hosted off-site.
In addition to simplified security, in-house FlexATM implementations feature a straight-though connection between the financial institution and its debit card network. Fewer “hops” reduce potential failure points and timing delays, critical when performing real-time debit card and ATM card authorizations.
If a hosted solution is desired, Atris can provide FlexATM through its hardened, all-fiber-optic data center. Fully secured and utilizing ultra-fast, high capacity Internet service, FlexATM processing is fully segmented for each financial institution to ensure continued security of confidential customer information.