The debit card market has seen dramatic changes over the last few years and 2005 was no exception. The U.S. retail gift card volume topped $18.6 billion last year, according to the National Retail Federation, and with more hybrid debit-card products hitting the marketplace, 2006 promises to be a banner year for both signature- and PIN-based branded stored-value cards.

Lyle Elias is the director of ATMIA's Debit Council.

This year we will most likely see a new signature debit card from the Discover Network. Stan Paur, president and chief executive of Discover's Pulse EFT network, said he expects an announcement to be made within the next couple of months. We also may see by mid-2006 at least one EFT network testing Web-based PIN debit transactions, before a commercial rollout with a major retailer at year's end, according to ATM Direct.

American Express gift cards were a big hit in 2005, especially at retail. The Amex gift cards accounted for about 55 percent of Valero Energy Corp.'s third-party gift-card sales since their recent introduction to the chain, said Gary Arthur, Valero's senior vice president of retail and specialty products marketing. The cards are being offered in 635 of the company's Valero and Diamond Shamrock Corner Stores, which are located in Texas, California and Arizona. Valero is among the first convenience stores in the country to offer the Amex gift cards.

The ATM Industry Association organized the ATMIA Debit Council in 2005 and has published its first Stored Value Card Best Practices Manual for the industry. Last year also saw the formation of the Branded Prepaid Association - a new trade association spearheaded by Columbus, Ga.-based TSYS for the branded-prepaid-card industry. That association is being managed by the Electronic Funds Transfer Association.

All prepaid cards are hot items for banks and retail card issuers, and there's a growing reseller market for independent sales organizations and service bureaus.

This year marks the first for the Prepaid Card Expo, which will be held Feb. 15-17 in Orlando, Fla. The second full week of February also marks ATMIA's Conference East and NetWorld Alliance's The Self-Service & Kiosk Show, both in Orlando. Talk about a scheduling nightmare!

On the regulatory scene, the introduction and passage of gift card related legislation continues unabated. Everything from restrictions on usage fees to changes of escheatment laws are on the books or in various stages of the legislative process around the country. The ATMIA Debit Council is actively monitoring debit-card-related legislation and provides its members with updates and access to an online legislative monitoring service.

A few concerns continue to be voiced by some law enforcement officials about the use of branded stored-value cards for money laundering purposes, however restrictions put in place by the industry make the cards a less-than-ideal money-laundering tool. Money services and transmitting licensing requirements for resellers is going to be an area to watch in 2006.

All in all, there won't be a dull moment in the debit card world in 2006.