Financial technology (Fintech) companies are increasingly issuing cards in order to provide their customers with greater access to financial services.
Interswitch, a payments and digital commerce company, has launched its Fintech Card Issuance (FCI) solution to allow Fintechs and other financial institutions to issue cards to their customers, improving access to financial services for both domestic and global communities.
Previously, card issuance was primarily handled by banks, but the rise of Fintech companies and other financial institutions offering a range of banking-related solutions has created a need for a universally acceptable means of accessing Fintech wallet balances and conducting web, Point of Sale (PoS), and Automated Teller Machine (ATM) transactions.
According to Akeem Lawal, Managing Director of Interswitch Purepay, the FCI solution allows these institutions to issue cards to their customers with minimal investment, but with the requirements of a standard processing system.
It also enables them to increase their customer base, resulting in cost savings for both Fintechs and banks, increased revenue through card payments from customers, increased customer loyalty, improved synergy within the Fintech community, and enhanced customer experience.
The FCI solution includes three phases: issuing, processing, and operations. During the issuing phase, physical cards are issued and card management is responsible for activation, deactivation, hotlisting, and PIN changes.
The processing phase allows for the utilization of the value available in the customer’s wallet, including debit, balance, enquiry, and transaction reversal services.
The operational phase involves settlement for the Fintech’s nominated financial institution on a T+1 basis (meaning that if a transaction occurs on Monday, the settlement must occur by Tuesday) and allows Fintechs to respond to transaction disputes on Arbiter.
In order to utilize the FCI solution, Fintechs must secure a sponsor bank and a Bank Identification Number (BIN) range provided by the bank on their preferred card scheme.
They must also provide Interswitch with a signed Service Level Agreement with their sponsor bank. This BIN range will be configured on Interswitch’s card management system to validate transactions.