Benefits of Instant Issuance
Credit cards have been operating in various forms in Canada since the 1930s. Consumers have spent almost ninety years following almost the same rigid process to get a credit card – filling out paper forms and waiting to have their information processed in central issuance facilities, before receiving their plastic card in the mail up to two weeks later. The rise of Fintech has put pressure on financial institutions to respond to a new technically educated generation who are pushing boundaries across all sectors ready for revolution and instant issuance is about to revolutionise the banking sector because the benefits are too good to ignore.
For consumers, the benefits of instant issuance are obvious; this is the age of instant gratification – combine this with data privacy concerns over the insecurity of paper forms and long, drawn-out banking processes are sending credit hungry customers elsewhere.
All these customer journey weak points have now been solved under one smooth easy transaction, and satisfied customers will walk away with a positive image and ready to pass on the halo effect to their friends and family.
Instant issuance offers banks even more benefits than consumers:
- Reduced costs: Instant issuance eliminates the costs typically incurred with printing, packaging, shipping and handling thousands of cards every day
- Competitive advantage: Instant issuance delivers an easy, fast, convenient, and valuable service to cardholders and will eventually become the new status quo. The time now however is ripe for financial institutions to benefit from this being a competitive differentiator and harvest the benefits of increased new customer accounts, revenue windfalls and customer satisfaction increases before the market becomes saturated.
- Superior security: The cards stay either in the bank’s possession or the consumers, with little to no opportunities for third party fraud and a reduced likelihood of cards getting lost or stolen in the post.
- Revenue returns: The return on investment that instant issuance offers will please the most skeptical of CFOs. Here’s why:
- More than double activation rates on Day 1, with 3x the multiple merchant spend. That means up to several weeks of additional consumer spending, making the card work for the bank faster.
- There are serious cost-saving opportunities for banking institutions to decommission some of their existing technical architecture reducing yearly operating costs, while still benefitting from being able to utilize existing architecture to move to instant issuance. This may decrease the overall Total Cost of Ownership of the technology stack needed to support the issuance of all types of cards.
- Several business revenue models could be implemented to capitalize on the revolutionary instant issuance service, from charging a premium fee to attracting higher value customers
Consumers have changed, and banks are changing too. Consumers now want more than simply a product; they want an experience. Those with enough foresight and with an appreciation for innovation will recognize instant issuance as one of the key differentiators for the foreseeable future in the banking market. Instant issuance offers financial institutions the ability to transform their customer journey process, improve their key customer touchpoints and make money while doing it.