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Fast Food Gets Faster Service

McDonald’s Mexico restaurants in Monterrey, Nuevo Leon, have begun to accept contactless and traditional bank cards. To facilitate the services, Banamex Citibank has deployed a multimedia payment platform from Verifone Holdings, San Jose, Calif.

The VeriFone MX870 multimedia payment platform and content delivery system will speed payment at McDonald’s counter while also delivering menu and promotional information to consumers in a full-motion video complete with digital sound. McDonald’s customers can view menu items and order information, as well as use their preferred payment card, all on the one system.

In a prepared statement, German Gudino, marketing director for McDonald’s Mexico and Central America, said, “The complete payment process is faster and mistakes are reduced…our customers view their order before it is transmitted to the kitchen and before they have made payment.”

The process is further expedited because orders that total less than 250 pesos (U.S. $25) do not require a customer signature.

Big, Bold Displays Sell Gift Cards

According to Kansas City, Kan.-based Kendal King Group, the supplier that designed and produced 2006 holiday gift-card programs for retailers including Wal-Mart, Lowe’s and Michaels, the most important aspect is a “strong, up-front presentation” of the gift-card display.

The In-Store Marketing Institute, based in Chicago, recognized Wal-Mart’s 2006 holiday gift-card display as a success because of its easy-to-find location in the front of stores; its continuation of Wal-Mart’s “Be Bright” holiday theme; and its easy-to-access, four-sided design, which created a sense of shopping urgency via a daily countdown to Christmas.

Heated Debate on Interchange Fees Continues

Last month, the Food Marketing Institute (FMI) lauded another politician’s stand on controversial interchange fees, which the FMI has characterized as “abusive practices” by credit-card companies. Sen. Norm Coleman (R-Minn.) called for the Permanent Subcommittee on Investigations (of which he is the ranking member) to examine how hidden interchange fees on credit-card transactions increase consumer prices.

Senators have been circling their wagons around this heated debate since January, when Senate Banking Committee Chairman Christopher Dodd (D-Conn.) called attention to what he described as “opaque fees,” that are passed from credit-card companies to merchants to consumers.

At a public meeting in February, ranking Senate Judiciary Committee Member Arlen Specter (R-Pa.), escalated the rhetoric with his assessment that, “We may need to modify our antitrust laws to stop credit-card companies engaging in activities to gouge and jack up prices.”

Interchange fees, which are collected by Visa, MasterCard and their issuing banks on every credit- and signature debit-card transaction, totaled $30.7 billion in 2005, up from $16.6 billion in 2001. Consumers are not informed about the fees and retailers are prohibited from offering discounts to consumers who pay by check or cash. Additional information is posted at the Merchants Payments Coalition Web site, which launched last month at www.unfaircreditcardfees.com.

Purging the Paper Trail

Last month, the new Back-Office Conversion (BOC) rule took effect, allowing retailers to retain paper checks accepted at the point of sale and convert all checks to electronic transfers in a centralized location. For retailers with multiple checkout lanes, this simplifies the POS process and eliminates the need for imaging technology at each lane.

However, the new BOC process carries the added responsibility of what to do with the paper check after the electronic transfer has been completed. Retailers are required to keep an image of the check for at least two years, but may dispose of the actual paper at any time. (Under previous point-of-purchase processes, the check was electronically imaged at each POS station and the paper check was returned to the consumer.)

“There is a risk, potentially a big liability, with BOC—namely the retailer will be [accountable] for anything that happens with a check,” noted Charla Hausler, an associate in the Chicago office of Barnes & Thornburg, which is ranked among the 100 largest law firms in the United States. “Retailers will have to implement good security procedures. Checks may be locked in a safe for a period of time and then shredded, but there have to be policies in place for when and how the paper is destroyed.”

Additionally, the image and information that was electronically captured must be held in a secure, preferably encrypted, database.