by Ayşen Nergiz, Meriç Özgen
Grow Your Cardholder Portfolio with Innovative Issuing Solutions
As an issuing bank, both traditional and challenger banks are simply responsible for providing their cardholders or customers with a credit card, debit card, or prepaid card product or service and determining an appropriate credit limit.
Still, in today’s competitive banking environment, offering traditional banking products and services is not enough for banks to expand the number of their cardholders and ensure cardholder retention.
Through this blog post, we will dive into the needs and challenges of issuing banks, explain our innovative issuing and issuing processing solutions, and share experience-packed strategies to help you expand your cardholder portfolio.
The Needs and Challenges of Issuing Banks
Today’s banks are operating in a competitive environment, challenging them to modernize and upgrade their card-issuing solutions and products to ensure an immediate and improved customer experience. Because with that many card offerings and payment solutions in the market, it is easy for customers to switch cards and look for a better deal.
In addition to the increasing competition, these banks face pressure due to evolving technologies, changing customer perceptions towards financial services, and external players entering the market.
Here is a closer look at all these challenges.
Keeping Up with the Virtual World
It is clear that with all the artificial intelligence applications and emerging digital technologies, technology has become ingrained in our culture and extended to the banking industry.
By 2026, it is expected that the contactless payments market size will quadruple in value due to high consumer demand. So in today’s virtual world, providing a digital-first experience with digital and contactless payment methods, such as QR codes, mobile wallets, and NFC payments is no longer an option for issuing banks.
This means when a bank or financial institution falls short of partnering with an issuer processor offering innovative card-issuing solutions, it can be left out of the competition.
Additionally, one of the most disruptive aspects of the competition in the market is virtual cards or payments. Nowadays, a lot of brands, like Starbucks, Vodafone, and Apple, are offering a mobile payment gateway via virtual wallets or cards to affect customers’ purchasing decisions, resulting in cardholders leaving physical or virtual cards offered by banks. In fact, 67% of millennials don’t even have a physical card.
Meeting Rising Expectations
Today’s customers are savvier and more informed than ever before. They expect to encounter a personalized, fast, and convenient banking experience. They want every process in the cardholding journey, from ordering cards to setting PIN codes, to be in real-time and easier. For example, 47% of consumers in the market prefer to open a new bank account through a mobile app or website.
They also want constant control of their bank account and communication through mobile banking apps and use physical, digital, and virtual cards holistically to meet all their payment needs.
Ensuring Customer Retention
According to the Accenture Financial Services Global Study, nearly 49% of 33,000 banking customers stated that their loyalty towards a bank is driven by service quality.
For banks and financial institutions, expanding service quality requires providing customers with flexible and easy-to-use banking services and card products tailored to personalized and meaningful experiences.
Therefore, to build a rich relationship with cardholders, card issuers should obtain a data-driven approach and identify key parameters, like card spending behavior and balance trends, to enhance preposition value with informed decisions.
By nature, issuing and card management systems hold sensitive customer information, making fraud one of the leading challenges in the industry. In terms of card issuing, the biggest fraud challenges banks encounter are card enumerations, card-not-present frauds, point-of-sale frauds, and account takeovers.
In 2022, the percentage of total identity fraud reached 79%, meaning that banks and financial institutions must invest in fraud solutions and technology-driven security measures, like location-based, risk-based, and biometric authentication.
A Closer Look at PayCore Issuing Solutions
Within each swipe or online payment process, you are providing your customers with an experience that will determine if they stay loyal or influence people to prefer your card offerings over other ones on the market.
So it is essential for card issuers to provide their customers with customer-centric and flexible card products and services to overcome current challenges and widen their portfolio. Considering that, we offer comprehensive and innovative issuing solutions for banks, PSPs, and financial institutions.
Our easily adaptable and EMV-compliant issuing and issuing processing solutions enable our partners to holistically manage all their card products and support all forms of payments and international or local schemes.
Thanks to our complete issuing platforms and services, you can continuously monitor your operations, immediately offer personalized card products, innovate your offerings, and complete key actions, like chargeback, clearing, and settlement management.
Let’s join forces to help you deliver value-added offerings and services to your customers with our agile debit, credit, and prepaid card issuing solutions and services!
Strategies to Expand Card Portfolio with PayCore Card Issuing Solutions and Services
As we stated above, expanding the cardholder portfolio and ensuring customer retention is all about putting time and effort into upgrading your value proposition and providing unique experiences. Here is how you can achieve this with innovative issuing solutions.
Utilize Data to Expand Your Customer Base
Segmenting a large customer base and gathering actionable insights about customers’ spending habits, preferred points of sale, income, or demographics enable banks and institutions to identify profitable segments and determine unique promotional content for each existing and potential customer.
For example, with PayCore issuing processing solutions, you can monitor key customer data to take targeted actions for potential customers in the market with your card products, services, or offerings.
Supercharge Your Offerings with Loyalty Programs
Creating effective loyalty programs is key for any financial institution to expand the number of customers, grow revenue, ensure retention, and increase referrals. The key to creating and maintaining successful loyalty programs is to collect actionable insights with a detailed, value-based CRM approach and incentivize customers accordingly.
By studying the needs and requests of your existing or potential customers, you can diversify your loyalty programs with different kinds of campaigns to attract the right customers for your card products or services and generate value for your cardholders.
Modernize Your Card Management Systems
Considering all the technological and cultural challenges banks encounter today, it is right to say that the modern way of card issuance is much more than just a payment service.
It is more about tailoring products and services with changing expectations and emerging shifts so that they can attract the right customers and expand their card portfolio. Therefore, for issuing banks, it is essential to innovate their card management systems by partnering up with the right payment processor.
As a payment processing services company with 21+ years of payment software expertise, we are here to holistically upgrade all your card management systems and help you meet all the acquiring and issuing requirements today and well into the future.
Take a closer look at the holistic card management system, Ocean 2.0, now to gear up for the future of the banking industry, manage all your issuing and acquiring operations seamlessly, and create smart card products and offerings for your customers!