Why Debit-Card-Only Acceptance Makes Sense for Debt Repayment

Sometimes customers fall behind on payments. If you’re a financial institution or lender, you know how challenging collections can be. You want to make the debt repayment process as easy as possible while reducing your operational costs and risks of non-payment. Also, it’s a process you want to get right from a compliance standpoint: For example, businesses may be restricted from accepting credit card payments for debt repayment.

If debt repayment isn’t already a high-priority customer journey for your business, it will be. The Federal Reserve reported that household debt balances continue to rise. By the beginning of 2024, the rate of credit card balances in serious delinquency hit their highest level since 2012. Young adults are particularly at risk; with their short credit history, they’re more likely to be maxed out on credit cards and miss payments, the Fed noted.

With these economic indicators, you’ll want to ensure your business has a strong strategy for facilitating debt repayment. One payment method, in particular, will take on new importance as part of the strategy: debit cards. Debit-card-only acceptance will enable you to accept this payment method without accepting credit cards, and you can always use it to complement your ACH payment acceptance.

Here are four reasons why you should consider a debit-card-only strategy for debt repayment.



Other common payment methods, such as ACH payments, can take days to clear or even bounce due to insufficient funds or inaccurate account information. (If ACH returns are a costly issue for your business, recovery solutions can help.) Debit card payments, however, are authorized in real time. This means you can instantly confirm payment approval and that the customer’s account has the available funds. By steering customers toward making repayments by debit card, you can minimize the risk of receiving a delayed return, which can disrupt your cash flow and cause additional operational costs.



When you reduce returned transactions by accepting debit cards, you also reduce the need to contact the customer to resolve the issue. Debit card payments will get responses to authorization requests while the transaction is taking place. If the request is declined, you will know on the spot and you can ask your customer to try another payment method instead of having to learn later that a payment is returned. This helps you save on costs and resources associated with collections and call center operations.



Setting aside debt repayment for a moment, consider the popularity of debit cards as a payment method in any situation, especially in the U.S. According to a survey by S&P Global Market Intelligence, 56.2% of Americans use debit as their primary payment card, compared to 39.4% who use credit cards and 4.4% who use no payment cards at all.

A debit-card-only strategy for debt repayment keeps this payment method available for customers, letting you meet them where they’re at in their payment preferences. Also, the reduced risk of returned transactions mentioned above carries a customer experience benefit: When you decrease the need for your customer service team to follow up with customers due to declined ACH payments, (unlike declined debit card payments, which can be remedied in real time) you prevent interactions that are often frustrating and time-consuming for customers and employees alike.



One caveat with accepting debit card payments is the processing fees that you have to pay to the card networks and issuers. However, with CSG Forte’s debit-card-only acceptance, you may be able to access the benefits of debit card payments without increasing your processing costs.

With our solution, you may be able to charge a per-transaction fee exclusively for debit card payments, which can offset or eliminate the processing fees. You can even customize the fee amount and frequency to fit your business needs and your regulatory requirements. CSG Forte can help you implement a convenience fee solution that is transparent, fair and convenient for your customers while also protecting your bottom line.



We’re more than just a payment processor. We’re a partner who can help you optimize your debt repayment strategy with our comprehensive solutions. We offer:

Validation and recovery services. You’ll want solutions that help reduce the risk of customers falling into collections in the first place. With CSG Forte Verify, you can validate accounts and reduce entry errors in real time before initiating an ACH payment. With our automatic retries, you can recover failed or declined ACH payments.

A cloud-based, unified platform for payment operations and reporting. With CSG Forte Dex, you can simplify your payment management and gain insights into your customer behavior and preferences. You can also access all your payment data and reports in one place and integrate with your existing processes.

Multichannel payment solutions for your customers. Whether they want to pay online, by phone or in person, we have the tools and technology to facilitate their payments. You can offer them a seamless payment experience across all channels and increase your payment conversion and retention rates.



Consumer debt is rising. The debit-card-only approach can help, yet it’s a single component of a strong debt repayment strategy for your business. Contact us to learn more about our debit card acceptance solution and how we can help you improve your payment performance and customer satisfaction.