In today’s rapidly evolving digital landscape, the demand for convenience and immediacy touches every facet of our lives. From the impressive speed of food delivery apps to the seamless access of digital banking services, we live in an era where real-time expectations are the norm — and waiting for a credit or debit card to arrive via snail mail is no exception. Given the increased consumer demand for immediacy, credit unions should explore the benefits and opportunities of digital issuance — if they have not already.
Empowering Members With Instant Access
Digital issuance offers credit unions a competitive edge by ensuring seamless transactions and uninterrupted payments through cutting-edge push provision technology. Even when a card is lost or stolen and a replacement is needed, members can continue transacting without missing a beat.
With digital issuance, there is no need to manually add cards to digital wallets or worry about missing recurring payments. Members can immediately access their digital card credentials, making online shopping effortless without having to wait several days for a card to arrive. This is particularly valuable for members on the go who don’t typically use their physical card anyway.
Reclaiming Interchange Revenue
The advantages of digital issuance extend well beyond the member experience. Credit unions have an opportunity to recover substantial interchange revenue they could otherwise lose due to the time it takes to print, process, and mail physical cards.
For example, take an average daily credit card purchase amount of $19.31, which contributes to a daily interchange revenue of 34 cents. If, in a hypothetical scenario, 10,000 cards take five days to arrive, the credit union could miss an opportunity to make $17,000 in potential interchange revenue. For debit cards, let’s say the average daily purchase total is $35.05, with an average daily interchange revenue of 33 cents. In a hypothetical situation where 50,000 debit cards take five days to arrive, the credit union could miss an opportunity of making more than $82,000 in potential interchange revenue.
These figures reveal the significant opportunity costs that can accumulate when a credit union’s standard practice is slower, non-digital issuance.
Unlocking Instant With APIs
To address these challenges and harness the full power of digital issuance, credit unions can leverage application programming interfaces (APIs). Through APIs, credit unions can streamline their card issuance processes, including the following:
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- Push Provisioning: Effortlessly provides members with new card credentials, ensuring immediate access to their digital cards.
- Card Credentials Access: Grants members access to their card credentials within their credit union’s mobile app, simplifying the process.
- Card Add Automation: Automates the addition of new cards, eliminating the need for manual input and reducing the likelihood of errors.
- Card Replace Automation: In the case of lost, stolen, or compromised cards, facilitates automated replacements, which lets members continue to transact without disruption.
- Card on File Updates: Ensures members’ payment methods remain current with real-time card on file updates as needed or required.
By implementing digital issuance through APIs, credit unions have the opportunity to earn interchange revenue while enhancing the member experience. This proactive approach is crucial for meeting the evolving expectations of members in an increasingly digital world, and it is gaining momentum among financial institutions. According to PSCU’s 2023 Eye on Payments study, more credit union members received a digital card to use while waiting for a physical card in 2023 (30%) compared to 2022 (23%). Among those who received a digital card, 86% used it while waiting for their physical card to arrive.
If credit unions are not sure how to best go about offering a digital card issuance experience, consider partnering with a fintech CUSO like PSCU that provides access to the tools and resources needed. Credit unions can position themselves as the top choice for their members’ digital wallets by offering a card issuance experience that meets the demand for convenience and speed. The time to implement digital card issuance is now.
Cody Banks leads PSCU’s payments, fraud, loyalty, and contact center product teams. In his role, Cody focuses on developing and delivering safe, easy, and convenient payments experiences for the company’s owner credit unions. Prior to joining PSCU in 2017, Cody spent nearly 10 years in the credit union industry navigating complex initiatives with a focus on journey mapping the member experience.
