Karen Postma, AVP of Fraud Operations for payments processor The Members Group (TMG), Des Moines. Iowa.

There are two key aspects to a credit union’s breach response strategy today: Loss mitigation and PR/communications.

When considering your reissue strategy, cardholder impact is a critical consideration. Fortunately for credit unions, this comes naturally. Protecting the credit union IS protecting the member. One does not have to take priority over another.

The fraud rings operating in our country today are becoming extremely precise on where and how they commit payment fraud to emulate actual cardholder spending patterns. The heightened difficulty of detecting fraud makes a mass reissue tempting, even given the cardholder impact.

Interestingly, there has been a shift in consumer attitudes about having their cards replaced. In fact, some of The Members Group’s (TMG’s) credit union clients report getting requests for reissues from their cardholders. Members have heard news of a major breach within the systems of a brand they do business with, and they WANT the reissue.

In cases like this, it becomes the credit union’s job to educate cardholders on the nuances of data breaches (not all cards used at a breached merchant will necessarily experience fraud). It’s also a great opportunity to inspire confidence in the credit union by sharing how fraud is detected and stopped. Consumers today are more interested in this “peak behind the curtain” than ever before.

At the end of the day, it comes down to an analysis of the likely impact to your portfolio balanced with the reissue tolerance of your cardholder base. There is no way you can reissue after every breach. 

In terms of communications materials, absolutely ask your payments processor. TMG, for instance, offers its credit union clients cardholder service scripts, e-mail templates and other communications tools to help them educate cardholders quickly and accurately.