Stages of the life cycle of payment cards. Life cycle of a card and agreement. Establishing a new card

Depending on the issuer - the organization that issues and supports PCs, and therefore on the scope of application, the following types of cards can be distinguished:

• banking, issuer - bank;
• trading, issuer - shops;
• fuel, issuer - gas station networks;
• transport, issuer - transport organizations;
• telephone,issuer - telephone companies;
• joint(co-branding), the card has several issuers.

Depending on the method of recording and processing data on the card, PCs are divided into the following types.

• Embossed- information is applied to the surface of the card by embossing or thermal printing.
• With bar codes- information is applied to the surface of the card in the form of a barcode.
• With magnetic strip- information is recorded on a magnetic stripe, which is then placed on the surface of the card.
• With integrated circuits. Cards in this category are divided into the following subtypes:
  • memory cards. A low-performance chip is used, which, as a rule, allows only storing information without the possibility of overwriting the latter;
  • microprocessor, or smart cards- programmable devices capable of reading, writing and processing information.

According to their payment capacity, cards are divided into the following types.

• Cards with score. Cards of this type are linked to a specific personal account, with which, according to accounting rules, all payments for card transactions are made. There are two types of card data:
  • debit cards. The card is linked to a specific current account, payments on the card are allowed within the free balance ( available balance) on the account, overdraft (borrowing money from the issuer) is unacceptable. Can be used to pay for goods or services, as well as to receive cash up to the balance in your bank account. One of the variants of this card are the so-called prepaid cards, where a certain pre-deposited amount is used as the available balance;
  • credit cards. They are used to obtain a user loan; the holder uses the issuer’s funds and then repays the resulting debt. The maximum amount of court debt ( credit limit) is determined by the card issuer. These cards can be divided into three categories:
    1. payment cards. The card works with a current account, but allows overdraft within specified limits. Overdraft debt must be paid at the end of each month,
    2. revolving overdraft cards. The card works with a current account with a permissible overdraft, there is no requirement for monthly repayment of loan debt,
    3. revolving credit cards. The card works with a loan account, there is no requirement for monthly debt repayment.
• Cards without counting. Provide operations not related to payments. As a rule, this is access to services or discounting (calculation of cost taking into account certain factors or provision of discounts or other benefits to the holder by the card issuer) when paying for goods or services.

Based on the duration of use, cards are divided into the following types:

• disposable. Cards only work in data reading mode. Typically, these are prepaid cards in which the available balance decreases as the card is used and cannot be topped up;
• reusable (rechargeable). The available card balance can be topped up.

Based on the method of reading cards, they are divided into the following types.

• direct reading. The card is powered using a special reader; in addition, direct contact between the reader and the card contact pad is required;
• contactless. Allows you to use the card without direct contact with the reader. The card's power supply is based on the principles of electromagnetic induction.

Based on the number of applications supported by the card, there are:

• single purpose cards- support one application;
• multi-purpose (multi-application) cards - support multiple applications.

7.2. Plastic card standards

The standards used in the manufacture and firmware of plastic cards are given in table 7.1.

7.3. Map appearance

An ID-1 format card is a parallelepiped with rounded edges with certain parameters (Table 7.2). Cards of ID-2 and ID-3 formats differ only in size, but in other physical characteristics they are the same as an ID-1 format card. Cards of the ID-000 format are manufactured as a part, separated from the card of the ID-1 format (to remove the ID-000 card from the ID-1 without the use of auxiliary tools, a relief zone is located around the perimeter of the ID-000 card).

Face

The front of the card contains the following information:

• logo of a financial institution;
• payment system trademark;
• embossed data;
• card chip contacts (for cards with integrated circuits, the location is determined by the ISO/IEC 7816-1 standard).

Embossing involves the formation of relief characters, which can later be used to print these characters on special forms using a device called an imprinter. The ISO/IEC 7811 standard establishes the acceptable characteristics of raised characters, as well as the location of two embossing zones on the front surface of a payment card.

The first embossing zone is intended for the location of raised symbols of the card identification number, defined by the ISO/IEC 7812 standard. The card identification number is equivalent to the account number - PAN (Primary Account Number). PAN is no more than 19 digits in length and consists of the following parts.

• Major Industry Identifier (MII). Industry affiliation of the card. The first digit can take the following values:
• Issuer ID. Numbers two through six. The first six digits together form the Issuer Identification Number (IIN).
• Client account identification number. Numbers from the seventh to the penultimate, no more than 12 digits.
• Luhn Check Parity code. Defined according to ISO/IEC 7812. Last digit of PAN.

The second embossing zone can contain four rows of 26 characters each. As a rule, the expiration date and name of the card holder are located in this zone.

Reverse side

At the top edge of the back of the card there is a magnetic stripe (if there is one). Data is stored on three tracks, with the first two being read-only and containing identification information; the third track can be used in read/write modes and is intended for storing and modifying data used in transactions.

Under the magnetic stripe there is a place for the card holder's signature. Also on the back of the card there may be a photo of the card holder and some additional information.

The site contains the following contacts:

• VCC - card supply voltage;
• RST - reset signal;
• CLK - synchronization signal;
• GND - ground;
• I/O - input/output;
• VPP - voltage for programming EEPROM;
• RFU - reserve;
• cards operating via the USB protocol use redundant contacts as D+ and D– to implement a data exchange channel operating via the USB protocol.

7.6. Smart Card File System

The minimum logical unit of information in a smart card in accordance with the ISO/IEC 7816 standard is data element(DE - Data Element). In physical memory, a data element is represented data object(DO - Data Object). Each data object is represented by three fields:

• tag (tag) - encodes the class, type and identifier of the data object;
• length (length);
• value.

A collection of data elements forms files. Each file has its own number or identifier, consisting of four 16-bit digits. There are two types of files in smart cards, shown in Fig. 7.4.

• DF (Dedicated File) - directory files. Define sections of the user part of the EEPROM and containing other files. A sign that a file is a directory is the last two digits of the number are zero. According to the ISO/IEC 7816 standard, the file system can support up to 62 DF files (01 00, 02 00, …, 3E 00). The smart card must contain at least one DF file, called MF - Master File. This file is numbered 3F 00 and is the root of the tree structure that represents the file system.
• EF (Elementary File) - elementary file. Contains smart card data. Each elementary file must belong to a DF file. Belonging to a specific DF file is reflected in the first two digits of the elementary file number, which repeat the first digits of the DF file number of which the given EF file is a “descendant”. Each DF file (including MF) can contain up to 63 EF files.

Information about the file, be it a DF, MF or EF file, is stored in the file header, which is called FCI - File Control Information, and is presented in table. 7.3.

There are three types of elementary files:

• Secret- secret files designed to store key information;
• Working- working files are used to store data necessary for organizing interaction with external applications (terminal and issuer host);
• Internal- internal files are designed to store data necessary for the operation of card applications (transaction counters, wallets, certificates).

7.7. Commands for working with smart cards

To carry out operations with the card, you must have a terminal. For magnetic stripe cards, the terminal reads information from the magnetic stripe or writes information to a third track of the magnetic stripe. When using a smart card, the interaction between the card and the terminal is carried out according to the “client-server” principle (the card acts as a server, the terminal as a client). The interaction between the smart card and the terminal is carried out using the following layers of the OSI model:

• physical - determines the characteristics of electrical signals between the terminal and the card;
• channel - interaction is carried out using TDPU blocks (TDPU - Transmission Protocol Data Unit) of asynchronous protocols T = 0 and T = 1 according to the ISO/IEC 7816 standard;
• application - interaction is carried out using C-APDU (Command Application Protocol Data Unit) blocks, containing requests from the card, and R-APDU (Response Application Protocol Data Unit) blocks, containing responses to these requests from the terminal.

The structures of these blocks are presented in table. 7.4 and 7.5.

The list of commands used to work with smart cards is given in table. 7.6.

7.8. Ensuring the security of transmitted data

Data Security in smart cards is provided by solving three problems:

• card and owner authentication;
• encryption of transmitted data;
• generation of message authentication codes (MACs).

Authentication of the card and owner consists of two stages.

• Mutual authentication of the owner and the card. The procedure algorithm is as follows:
  • the terminal asks the card to generate a random number and determines the encryption algorithm;
  • The card, using a built-in generator, generates a random number, transmits it to the terminal, and also encrypts it using the specified encryption algorithm, using the PIN code written in the card as a key;
  • the cardholder enters the PIN code on the terminal keypad;
  • the terminal encrypts the random number received from the card using the selected encryption algorithm, using the PIN code entered by the user as a key. The encryption result is sent to the card;
  • the card compares the encryption result with the sent value. If the values ​​match, this means that the cardholder entered a PIN code that matches the one stored in the card, i.e. mutual authentication of the card and owner was successful.

  Most smart cards have a built-in counter for the number of incorrect PIN codes entered. Upon reaching a certain value of this counter, the card is blocked.

• Mutual authentication of card and terminal. The procedure algorithm is as follows:
  • the terminal generates a random number, sends it to the card and determines the encryption algorithm;
  • the card encrypts the received value using a specified algorithm on a secret key known only to the card and the terminal, and sends the calculated value to the terminal;
  • the terminal performs similar actions and compares the received values. If they match, this means that mutual authentication of the card and the terminal was successful.
  • encryption of information is carried out as follows. The terminal selects a symmetric encryption algorithm (as a rule, this is a specific algorithm for a specific issuer) and informs the card about the selected algorithm, after which a shared secret key is generated, which is used to encrypt the transmitted information. A secret key is generated for each new transaction.
  • recording pre-personalization data.
• Card personalization:
  • recording information about the issuer;
  • recording information about the cardholder;
  • downloading applications used by the issuer's payment systems.
• Card issue:
  • placing the chip in a plastic case;
  • applying the logo of a financial institution;
  • application of the payment system trademark;
  • application of embossed data.
• Using the card.
• Card cancellation. Reasons for card cancellation may be as follows:
  • the card has expired;
  • the available balance for disposable cards has been used up;
  • all memory cells reserved for data are filled;
  • The card's security has been compromised.
  access to the envelope with the card. There is no need to open the envelope. Such an attack can have serious consequences, since the attacker, in addition to the data from the card, also knows the recipient’s data, i.e. owner of the card. Physical access to mail is extremely easy (for example, in dorm rooms or mailboxes along the road).

  There are many varieties of this attack. For example, a very common "Bump-and-run" attack is where the contents of the victim's wallet become visible in a busy line, elevator, or subway.

  Some consumers who have smart cards with sufficient reading range prefer to simply hold their wallet to the reader rather than remove the card. This is what attacks are based on, in which an attacker's powerful radiation reading devices can read a customer's credit card information while the customer is simply reading a sign and is close enough to the attacker's reader. Another place where an attacker can illegally read smart card data is at the gym, where patrons often leave wallets in an unguarded locker by the door.

  Listening. When eavesdropping, an attacker uses an antenna to record data transmitted during communication between the reader and the smart card. Since eavesdropping occurs during live communication (for example, in a store), external protection (the case) will not be able to prevent such an attack. The success of the attack depends on many factors, including the reading range.

  Repeated signal. In this attack, the attacker transmits an exact copy of the radio signal received by the transceiver during the last transaction between the reader and the smart card. While simple attacks of this type are easy to prevent (time stamps, one-time passwords, question-answer cryptography), more complex attacks can still succeed. In such an attack, known as "relay", the attacker transmits a signal from a legitimate device through one or more rogue devices to a legitimate target, which may be located at a great distance from the attacker. The distance at which an attack succeeds depends primarily on the latency allowed by the protocol.

  It is obvious that developers of payment systems based on smart cards are forced to combat the attacks discussed above. You can adopt the technique described below, which allows you to successfully defend against such attacks.

  The technique is based on the use of a special blocking device - a “Faraday Cage”, a shell impenetrable to radio waves in the form of a metal mesh or casing. Today, customers can buy "Faraday Cages" made in the form of wallets or special cases. Such solutions make it possible to successfully protect smart cards from illegal scanning. However, when the card is removed from such a case to make a purchase, the attack becomes possible again. Clearly contactless credit card manufacturers should at least mail them in a Faraday Cage to avoid the Johnny Carson Attack.

  Undoubtedly, in the near future we can expect the emergence of a whole range of measures designed to ensure the security of contactless payments.

  Most likely, the new generation of cards will be equipped with a mechanism to disable them, i.e. switching to passive mode, in which reading data from the card will be impossible. To make a payment, the user will need to “turn on” the card, possibly using a special jumper on the card itself. Also, card activation can be realized using a built-in light sensor, i.e. in complete darkness (for example, in a wallet). With such protection, an attacker will not be able to withdraw funds from the card. It is possible to implement a similar function based on a built-in thermal sensor, which will activate the card when touched by a human hand.

The small and medium-sized enterprise (SME) segment is significant for banks, but at the same time, it has so far differed from other clients in the lack of sufficient experience working with financial institutions. Banks also preferred to work with retail, providing SMEs only with loans and basic settlement services.

If we compare small and medium-sized businesses with the corporate segment, the former is characterized by higher risks of insolvency. That is why, when working with SMEs, clear tracking of the customer life cycle is required, as well as more careful banking strategies aimed at maximizing the real or projected value of the customer throughout the entire life cycle.

Market situation

In recent years, banks have received the main income in the SME segment from lending. However, with the cooling of the credit market, all participants come to understand that loans are only part of the banking business. Increased regulation by regulatory government agencies, a decrease in lending profitability, and the entry of new players into the market are just a small part of the factors that are pushing banks to increase risk-free commission income.

In the West, this trend has been observed for more than 3 years. Thus, according to the study “Trends in transaction banking report”, in 2011, 77% of Western banks had already seriously thought about commission income, separated the transaction business into a separate area and began restructuring the income structure.

In the banks of the Life financial group, we are also looking towards increasing commission income, since they do not carry the same risks as income from lending. The task we face in 2013 is to double the growth rate of non-interest income in the small and medium-sized business division.

The task does not seem difficult and has at least two possible solutions.

1. Attracting new customers and increasing additional sales.
2. Increasing income from existing clients.

The first task of attracting new clients, one way or another, is solved by all banks on the market, but little is said about increasing income from the existing base, and the actions of banks in this direction are not so noticeable. Having seriously engaged in this process, we encountered a number of difficulties, which we were able to solve only by starting to model the customer life cycle.

Life cycle of an SME client in banks

The classic life cycle of an SME client in a bank is shown in green in the figure (areas 2-6): the client comes to the bank, starts working and brings some income to the bank, and usually leaves after 2-2.5 years, either closing the business or consolidating and changing the bank.

The strategy we have developed for working with the client’s life cycle is aimed at lengthening it and increasing the lifetime profitability of the client in each of the three areas that we allocate for ourselves:

1. attracting clients earlier
2. increasing current profitability from the client,
3. dealing with customer churn.

In this article, we will not talk about income growth due to earlier customer acquisition (blue section 1 in the figure) and churn (blue section 5-7), but will only touch on the growth of income from existing clients.

After attracting and stabilizing income from a client, the bank’s main task is to select and offer products and services that solve the client’s business problems. In fact, at the moment when the client began to work with the bank and generate a stable income (reached plateau 3-4 in the figure), the bank must conduct a serious analysis of his activities and offer him a set of cross-products that are relevant at the current time - this will increase profitability (blue fill on area 3) and maintain it in the future (blue fill on area 4).

Having offered the client a business solution, increasing loyalty and profitability from the client, the bank will need to control this process and not miss the stage of the client leaving for outflow (blue section 5-7). Working with churn implies deep knowledge of the client, the characteristics of his business and needs - only due to these factors it is possible to retain the client at an early stage and extend his life cycle in the bank.

Thus, having built the client’s life cycle, we have identified for ourselves the critical stages and the actions that we can take to increase the client’s lifetime profitability.

Life cycle - from theory to practice

In Life Financial Group banks, personal managers work with clients, using CRM as one of the main tools. By setting managers the task of increasing lifetime profitability from clients, we had to give them tools for effective work - unique triggers that signal in CRM when and what product to offer to the client at each stage of the life cycle. Thus, we moved to the use of mathematical analysis, modeling and targeted marketing tools.

Having analyzed the database, we identified segments for each bank of the Life Financial Group, for each region and area of ​​business, depending on the lifespan of the client in our database, his profitability and the list of services used. If we consider each parameter separately, it seems that we are collecting seemingly elementary things. However, examining all the data together, we identify quite interesting patterns.

The assignment of a client to a particular segment is recorded in the client card in CRM. For each large segment (group), we identify a characteristic set of services - based on the totality of data, we build a profile of the ideal client. By further comparing the profile of using bank services from a real and an “ideal client”, we identify real clients with an incomplete set of services and carry out cross-selling, developing lagging ones to a standard profile.

In practice, business managers receive triggers in CRM for the clients they accompany: what services should be offered to the client, recommendations for low-income clients.

By comparing the profitability and lists of services of a real and “ideal” client, we can display in CRM the level of potential profitability of each client, which encourages managers to develop clients and make cross-sales.

Triggers built on the basis of segmentation and mathematical modeling to recommend relevant services to the client are just one of the tools that help the business manager offer the client a business solution. Other tools and working with the outflow of clients from small and medium-sized businesses will be discussed in the following articles.

Life cycle of a card.

The life cycle of a card can be represented as a diagram:

Below is a description of the states of the plastic card.

Life cycle of a contract.

To operate the module for automating the work of individuals with plastic cards, service agreements are configured for those types of plastic cards with which the bank works. The life cycle of a contract can be represented as a diagram:

Below is a description of the conditions of the plastic card agreement.

Basic Operations

All Payment cards can be viewed in the subsystem Payment cards(Fig. 7), which is called from the main menu item Back office/ Payment cards/ Payment cards. Like any other table in the system, the table Payment cards includes records for objects (payment cards), hot buttons and fields that define the set of records displayed in the table. In this table, such fields are the fields Subdivision , Processing center , Card product , Status And State . If these fields are not filled in, the table will display all payment cards registered in the system. To specify a value in a field, click on the arrow button to the right of the field. The corresponding system directory will be displayed on the screen. The transition between the fields located at the top of the table is carried out using the key TAB .

The button displays a dialog box with a protocol of object states. The buttons are designed to search for records.

At the bottom left of the table are graphical identifiers and their names. These IDs appear in the first column of the table. They characterize the state of an object or other important properties of the object.

Rice. 7. Table Payment cards

Calling available actions

The list of actions available for execution in the table is called up by right-clicking. The figure below shows the context menu called in this way with a list of available operations in the table Payment cards(Fig. 8).

At any given time, the context menu displays commands that can be applied to the entry selected in the table. Some commands may not be available. In this case, they are highlighted in gray (faded) color.

The commands that appear in the table context menu can be divided into general commands that apply to most objects and specific commands that apply only to some objects.

Rice. 8. Context menu of the “Payment cards” table

Table 1. General operations

Establishing a new card

Opening the main map

To open a new card you need to in the table Payment cards call command Add context menu. A form for adding a new card will be displayed on the screen (Fig. 9).

Rice. 9. Form for adding a new card

Field Enterprise is not mandatory, its value is selected from the drop-down list, and in the future may affect the tariffs for the card and the list of card products possible for issuance.

By drop-down list in the field Enterprise we find ourselves in the directory Enterprises and organizations served by the bank (Fig. 10). This reference is also available using the command Document flow/Setting up software. This contains a list of enterprises and organizations with which the bank cooperates. For the convenience of working with the directory, it is possible to filter records by processing center, which ensures interaction between organizations and the bank; for this, a filter field is used Processing center.

Rice. 10. Table Enterprises and organizations served by the bank

In the field Client the bank card holder is indicated (an individual using a bank card on the basis of an agreement with the issuer).

By look'up in the field Client we get into the directory Clients(Fig. 11), where information is collected about all organizations and individuals with whom the bank, a user of the system, is in contact.

Rice. 11. Directory Clients

If the cardholder is already a bank client, then you just need to select him from the list that opens; you can use the fields to search for him Reduce Mask And Name mask. These fields are filter fields and perform the function of searching for clients by abbreviated and full name. Enter the first letters of the desired value in the locator fields, the system will filter out those customer list entries that begin with the specified characters.

If the cardholder is not yet a bank client, then information about him must be added to the directory Clients. To do this, use the command Add context menu, the form for adding a new client will be displayed on the screen (Fig. 12).

Rice. 12. Form for adding a new client

The operation of adding a client is described in detail in the documentation Basic module. User's Guide ( file CORE_OPR.chm ).

Next, fill in the field Card product, by look’up of this field we get into the directory of the same name, from where the required value is selected. Many fields ( Release mode, Limit scheme, Card design etc.) on the form for adding cards after selecting a card product are filled in automatically, because These parameters are set when creating a card product. However, here these parameters can be changed by selecting one or another value from the drop-down list of the corresponding field.

The current operating date indicated in the table is substituted as the opening date Payment cards, and in the expiration date field the expiration date of the card is indicated, calculated in accordance with its lifespan indicated on the card product. However, if the issue mode specifies a different card lifespan, then when the issue mode is changed, the expiration date will be calculated based on this value.

Code word- any combination of letters or numbers specified by the cardholder to confirm ownership in the event of loss, damage, etc.

Fields Limit scheme, Card design, Security deposit etc. on the tab Additionally(Fig. 13) are filled in automatically after selecting a card product.

Rice. 13. Bookmark Additionally forms for adding a card

The limit scheme indicates the types and amounts of restrictions for actions with the card. For example, a one-time purchase limit, a one-time cash withdrawal limit, a weekly purchase limit, etc. may be indicated.

In the field Application number The number of the application for opening a card is indicated.

Security deposit- this is an amount that is deposited into a specially opened account under the card and can be used by the bank to pay off payments.

Cancellation delay(if reissued) – the number of days during which transactions can be carried out on the card after its cancellation.

After filling out the fields of the input form, you must click the “Run” button; information about the new card will appear in the table (Fig. 14).

This card is in New, so it has a red marker in the ID column, which means the card is not valid yet.

Banking payment map- it's plastic map, which is a tool for accessing... .2005 "About electronic digital signature". Payment cards: business-encyclopedia. / Avakova Yu.M., Bystrov L.V., Voronin A.S. etc...

First of all, we sell a service, not a product, because if we don’t succeed with the service, then very soon no one will buy our product.

Julius Fleishman

Life cycle of banking products

One of the important factors for successfully conquering the market is the analysis and subsequent planning of marketing activities, taking into account the stages of the life cycle of a banking service.

The life cycle of a banking product is a process that must describe all elements of marketing from the moment the decision is made to provide a specific product, its entry into a specific market and until its exit from the market. This is a set of successive states of a product being on the market, each of which is characterized over time by the state of the external environment and the set of marketing strategies used (Fig. 2.1.1).

Let's consider the traditional stages (stages) of the life cycle of a banking product: the stage of introducing a new service to the market, or the introductory stage; growth stage; maturity stage; stage of decline, or stage of decline (decline stage) (Fig. 2.1.2).

Rice. 2.1.1. Life cycle of a banking product

Rice. 2.1.2. Stages of the life cycle of a banking productSource: compiled by the author based on data from: Nikolaeva T. P. Bank marketing. M.: EAOI, 2009. 224 p.

In the first stage, the goal of marketing is to create a market for a new service. Typically, a modification to a familiar service increases sales faster than a major innovation. At this stage, competition is inactive. Losses occur due to the existence of a high level of costs for providing services and unsuccessful marketing. Depending on the specifics of the service and the market, the bank sets a high or low “entry price” for the client for its product. Characteristics of the stage are shown in Fig. 2.1.3.

Rice. 2.1.3.

Banking service- a banking operation (a set of banking operations), reflected in accordance with the rules of accounting in credit institutions in a separate account or group of accounts grouped on the basis of economic homogeneity.

Banking product- this is the subject of an agreement between the bank and the client. Both individuals and legal entities can act as clients. The subject of the agreement may be any operations and services offered by the bank, and their combinations.

At the second stage of growth, the goal of marketing is to expand sales and product ranges of a specific service. Sales increase, the bank receives high profits. In accordance with the growing market, modified versions of the basic service are offered, which satisfies the interests of a specific client and expands sales. To achieve this, there is a price range and persuasive advertising is used. The main characteristics of this stage are presented in Fig. 2.1.4.

Rice. 2.1.4. Growth stage of the life cycle of a banking productCompiled by the author

During the maturity stage, banks try to maintain their distinctive advantage for as long as possible. Competition peaks and declines, and discounting is spreading. At this stage, services are provided to the mass market, clients and counterparties with average incomes. The characteristics of this stage are presented in Fig. 2.1.5.

During the recession or decline stage, products are characterized by a sharp decline in sales volume and a constant decline in profits. The bank's task is to extract the remaining potential and remove the product from the range (you cannot wait until it becomes unprofitable). The main characteristics of this stage are presented in Fig. 2.1.6.

Rice. 2.1.5. Maturity stage of the banking product life cycleCompiled by the author

Rice. 2.1.6. The final stage of the product life cycleCompiled by the author

During the recession stage, there are three alternative directions for marketing actions:

• 1) a gradual reduction in marketing costs due to a decrease in the volume of services offered and the number of branches (branches) distributing them. At the same time, the bank must begin to offer a number of other specific traditional and non-traditional services;
• 2) reviving the volume of service offerings, that is, changing the market position by modifying the service itself, finding an alternative market and/or form of sales, ways to promote services to clients and advertising;
• 3) cessation of production and provision of these services. A feature of banking services is that, depending on

market, certain services may be at different stages of the life cycle (Fig. 2.1.7).

Rice. 2.1.7. The final stage of the life cycle of a banking productSource: Information portal "The best schemes." URL: nintten.appspot.com.

A product may be growing in one market, while in another it may be at the maturity stage. An example is the heterogeneity of regional banking markets. The duration of individual stages may also vary for different products. The sales results of these products are different, and this prompts bank managers to make different decisions in response to changes in market conditions.

For example, the lending market in the Kostroma region is characterized by the presence of offers for the purchase of trucks, as well as used imported and domestic cars, and the almost complete absence of offers for lending used equipment for commercial use. Over the past years, the priority direction in the activities of credit institutions in the Magadan region has been mortgage lending, as well as the issuance of non-targeted loans to legal entities.

The program for providing investment loans to support entrepreneurship on preferential terms is the main one for the Sverdlovsk region. Currently, lending to legal entities is a priority activity for many Moscow banks, where legal entities can receive loans for a variety of purposes: replenishment of working capital, acquisition or reconstruction of fixed assets (real estate, equipment, transport), purchase of copyrights, payment of salaries to staff and so on.

Decisions regarding the creation of a new product must be rational, carefully prepared and executed. This mainly concerns the initial stages, which determine the success of introducing a product to the market. When creating a new product, the following set of actions is performed:

• identifying sources of innovation;
• selection of new products from the point of view of the organization's goals, its resources and consumer needs;
• Conducting marketing analysis to determine demand, possible sales volume and product price;
• product creation;
• product testing in test markets;
• making decisions about changes to the product and its improvement if necessary;
• introduction of a product to the target market / refusal of a product.

Thus, the effectiveness of banking marketing depends on the life cycle of the product and its modification and is closely related to its perception by consumers, which changes when one of the components of the product changes.