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Where's my Octopus?

Good ideas do not have to be complex.

"Obvious to the most casual observer" is a phrase I use quite frequently. The message has to do with de-complicating our solutions. The bottom line: good ideas do not have to be complex.

I travel a great deal.  One of the benefits of travel is that I have the opportunity to experience and observe many things.  Some things I like and some, well, you know the answer.  There are also a few "ah ha" moments that cause me to think of the possibilities.

Meet the Octopus

Not long ago, Hong Kong had a tremendous problem. Their public transit system relied on cash-in particular, coins. The bus and trains all required the fare to be paid in cash. In comes innovation, the Octopus Card, a reloadable stored value card that could be used on the Hong Kong Transit system. The result, the Octopus Card successfully replaced the need for cash and saved the transit authority a tremendous amount money hauling cash all around the system. Innovation did not stop there. The Octopus vendor noticed that the transit stations contained stores where transit riders were buying papers, drinks, and food. Why not equip these stores with the ability to accept the Octopus card? Bam, another great idea and millions of happy riders.

Will CTA enter the 21st Century?

I travel to Chicago frequently and fly into Midway, then take Orange Line downtown. To ride the Chicago Transit Authority, I buy a CTA card and board the train.

It is a regular occurrence for me and I have a bunch of CTA cards on my desk that serve as reminders that system is missing a tremendous opportunity.

Why can't the CTA create a system that utilizes regular debit or credit cards?  Why hasn't one of the major card companies been successful in convincing the CTA to accept their card exclusively for a fee?  This is not rocket science, just competitive innovation. I can only imagine the pleasant response from the many riders of the CTA when they find out that their card will work. Booya!

Student loans-bank on your future

A burden that continues to grow and weighs heavily on the youth of our country is student loan debt. Political arguments aside, it is the fastest growing segment of non-housing debt. The latest report from the New York Fed shows that nationwide, student loans represent 8% of non-housing debt and is growing. This has to represent a tremendous fear in the mind of the student. How do I pay for this when I graduate?

Here is an opportunity for innovation. All of us recognize that the college years represent the accumulation of debt. Why can't a card company or financial institution recognize this trend, and provide a cash back credit or debit card option that banks the points until graduation, in addition to paying the card holder a premium for banking the points for an extended period of time? The concept is "bank on your future" as opposed to "spend it now." Upon graduation, the accumulated points can pay down the student debt in a lump, make the monthly payment of a period of time thus taking the pressure off the immediately graduated student, or subsidize a portion of the monthly payment. Ultimately, everybody wins. The product would provide some immediate relief, reduce the pressure on the student, and encourage long range financial planning.

Where's my Octopus? It is obvious to the most casual observer and in the words of the band Chicago... "Right before my very eyes!" It was a great hit for the band--maybe your bank or card company can repeat the success.

Dan Fisher

Dan Fisher is president and CEO of The Copper River Group, a consulting firm headquartered in Fargo, N. D., that focuses on technology and payment systems research and consulting for community financial institutions. For nearly 30 years, Fisher has worked in the financial industry using technology to improve the bottom line. He was CIO of Community First Bankshares (now part of Bank of the West), has served as a director of the Federal Reserve Board of Minneapolis, the chairman of the American Bankers Association Payment Systems Committee, and was a member of the Independent Community Bankers of America Payments Committee. Fisher has written numerous articles on banking technology and the payments system. He has authored or co-authored six books and recently published a book titled, "Capturing Your Customer! The New Technology of Remote Deposit." You can contact Fisher at dan@copperrivergroup.com.
P.S. To understand Dan's nickname, check out "About the Wombat" on his website.       

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