By Steve Sievert
For many consumers, digital transactions are simply how payments happen. Card-not-present debit spend now represents nearly half of overall debit dollar volume, according to the 2025 Pulse Debit Issuer Study. This reflects a lasting shift in how consumers use debit and what they expect from their financial institutions.
Issuers increasingly face a simple but consequential question: Is your debit card the one consumers use every day or the one they reach for only occasionally? As consumers use debit for digital wallet purchases, person-to-person transactions and card-on-file payments, banks’ continued success depends on delivering debit experiences that fit how people pay today.
Digital capabilities
Debit remains foundational to the relationship between financial institutions and their customers. While the physical card still plays an important role, digital form factors and CNP transactions are driving debit forward and reshaping consumer expectations for payments and banking.
Consumers expect their debit card to work consistently across physical and digital channels, including in-store, online, in mobile wallets and as stored credentials on merchants’ websites. But sought-after digital capabilities are not limited to the point of sale. Account holders want to be able to request mobile wallet provisioning, lock and unlock their cards and manage their subscription payments via their bank’s mobile apps.
Subscriptions and stored credentials now account for a significant share of debit spend. Many consumers set a card on file and rarely think about it again, until a decline occurs or a replacement card disrupts payments. Banks that give customers visibility into where their card is stored and which payments are recurring see fewer disputes and unnecessary declines, while making it easier for customers to continue using debit rather than switching to another payment option.
Digital growth is reshaping fraud prevention
As digital debit use grows, fraud is evolving alongside it. Friendly fraud and sophisticated scams continue to rise, and artificial intelligence has made impersonation and social engineering more convincing. In this environment, traditional transaction-level signals often tell only part of the story.
Increasingly, the most valuable fraud indicators appear before the transaction itself. Issuers are investing in behavioral analytics to better understand how customers interact with their accounts. These tools analyze device usage, navigation patterns, login behavior and changes in transaction frequency or velocity. These signals help identify situations where activity does not align with the account holder’s behavior patterns, even when the transaction appears legitimate on its surface.
Timing also matters. Regular “always on” fraud and scam education is important, but banks should also strive to provide it in the moment. Customers respond far better to guidance that appears in real time, in context, when they’re in the midst of a transaction. Many institutions now surface scam warnings directly within the digital experience. Examples include:
- Introducing scam warnings within the digital person-to-person transaction experience to warn account holders of the dangers of sending money to people they do not know and to remind them such transfers are immediate and irrevocable.
- Pausing activity, presenting clear warnings and requiring a confirmation step such as contacting the institution when unusual events occur such as large transfers or a second address change in a short time period.
Those moments of intervention can prevent losses and reinforce confidence that the institution is paying attention.
Fraud prevention has also become more collaborative. Disputes and fraud cases move quickly, and card issuers increasingly rely on closer coordination with merchants, payment networks, law enforcement, telecom providers and other stakeholders. Faster access to order details, device information and fulfillment timelines improves decision-making and helps resolve issues more efficiently. In addition, social media plays a key role in investigation, asset detection and other aspects of fraud.
The right level of friction builds trust
Convenience remains important, but consumers do not want speed at the expense of security. In certain situations, a small amount of friction can be beneficial when it is applied thoughtfully and transparently.
Asking account holders to confirm their intention or complete additional verification steps has proven useful for banks that offer Zelle P2P payments. Such extra steps are not always convenient, but they are reassuring. Other examples of appropriate friction include asking cardholders to confirm that a transaction is legitimate via text message or voice. Even asking an account holder to initiate a transaction a second time can send a clear message that the bank is actively protecting them.
This is what the right level of friction looks like. It may involve step-up authentication, contextual warnings, confirmation prompts, or account alerts. When applied selectively, these measures reduce exposure to fraud without undermining the overall experience. In many cases, they strengthen trust by demonstrating that safeguards exist when risk is highest.
Winning in a competitive landscape
While debit usage continues to rise, the number of issued debit cards is increasing much more slowly, as reflected in Pulse’s 2025 study. At the same time, competition continues to intensify. Fintech firms and digital banks have gained share from traditional institutions, and large consumer brands are increasingly introducing bank-like products to move closer to everyday spending.
For traditional issuers, differentiation comes from pairing consumer trust with digital experiences that feel modern, intuitive and useful. Becoming an indispensable financial partner means helping customers manage money more effectively through tools such as spend analysis, transaction categorization, recurring payment insights, low-balance alerts, automated savings features and easy bill pay. Real-time communication — including SMS alerts for customers who opt in — reinforces the sense that the institution is actively looking out for account holders’ best interests.
Issuers that want to compete effectively should prioritize implementation of the digital capabilities consumers desire most. These include improving card-on-file transparency, modernizing fraud detection and applying targeted friction where risk is highest.
Institutions that treat digital debit as a core product, not a supporting channel, will be best positioned to drive everyday usage, protect customers and remain central to their customers’ financial lives.
Steve Sievert is EVP for marketing and brand management at Pulse, a part of the Discover Network.
