Credit cards have come a long way since they were first introduced in the 1950s. From metal “charge plates” and magstripes taped to cardboard to EMV chips and tap-to-pay technology, credit cards have evolved immensely since their inception. Whether consumers are swiping, inserting or tapping their plastic, every new progression of this payment method has brought increased security and convenience, driving the industry to safer and more efficient payment methods.
While these developments have improved the cardholder experience, as credit technology advances, it’s becoming increasingly more difficult for some financial institutions to keep up with the evolving demands of a credit card program. Managing a card program can be costly and time-consuming, with high operational costs and limited staff and resources.
If your financial institution is looking to start a credit card program or sell your current credit card portfolio, an agent managed credit card program – sometimes known as an agent program – may be a great low-cost way to increase your cardholder base, earn revenue and grow your portfolio without stretching your resources too thin.
What Is an Agent Managed Card Program?
With a managed card program, a financial institution collaborates with a trusted partner to coordinate all aspects of its credit card program, from credit decisioning, fraud monitoring, marketing, disputes and servicing. A dedicated card manager will be focused solely on increased card usage and portfolio growth for the financial institution, which gets access to the resources and expertise of its partner while freeing up time and resources for its staff.
A managed card program is a great place to get started for financial institutions that do not have an existing credit portfolio. Working with an established card services provider minimizes the risk and cost associated with a new credit program without compromising the potential revenue opportunities. Financial institutions looking to offer an issuer credit card program in the future can use this as a path to ownership, helping them better understand the challenges and complexities of managing a program.
Benefits of a Managed Card Program
An agent or managed credit card program presents a compelling solution to the credit card challenges faced by financial institutions today, like high program fees and struggling card penetration in a highly competitive industry. Through this turnkey program, financial institutions have the resources and scale to give their cardholders the cutting-edge tools and services they would likely be unable to manage on their own
What’s more, agent or managed card programs are designed by credit card experts, ensuring that financial institutions remain competitive in today’s dynamic financial landscape. By leveraging this comprehensive and expertly crafted suite of services, financial institutions can overcome their current credit card challenges and position themselves firmly in the market. Additional benefits include:
- Customer Experience: Managed card programs allow financial institutions to offer a plethora of innovative features and services to enhance the overall customer experience. These innovative features encompass elements such as robust rewards systems, autopay tools, digital issuance and advanced card management platforms, and foster a seamless and rewarding experience for cardholders.
- Marketing and Branding: Your brand identity not only builds customer trust and recognition but also is a powerful tool for attracting and retaining cardholders. Because a financial institution’s marketing resources are finite, products and services tend to compete for the spotlight. With a managed card program, financial institutions can deploy a suite of turnkey marketing campaigns tailored to target clients, fostering portfolio growth with minimal effort from the financial institution. We recommend they brand the cards as if they were the financial institution’s own, generating more brand awareness and strengthening market share.
- Technology and Security: Technology and security go hand-in-hand when it comes to keeping your credit card program safe. Teaming up with a partner who not only specializes in credit card portfolio growth but also advancements in safety like tokenization, biometric authentication and AI-powered fraud detection can go the extra mile in safeguarding your cardholders’ sensitive data. Using advanced API technology, mobile app integrations and user-friendly interfaces helps to improve the user experience. Additionally, leveraging a partner can ease the compliance, risk and regulatory burden that weighs heavily on financial institutions.
- Financial Inclusion: Managed card programs provide a gateway for underserved communities to participate in formal financial activities where they otherwise wouldn’t be able to, empowering them with tools for managing their finances and contributing to a more inclusive and robust financial landscape. Through these programs, individuals who might have faced barriers to traditional banking can now enjoy the benefits of secure and convenient financial transactions. The increased accessibility fosters economic growth within these communities and enhances overall financial inclusion by connecting individuals to the broader financial ecosystem.
The evolution of credit cards has brought about both opportunities and challenges for financial institutions. Navigating the intricacies of issuer card programs can be daunting, with high costs and evolving customer expectations. An agent managed card services program is a strategic solution, providing financial institutions with the expertise and resources needed to thrive in this dynamic landscape. The benefits are far-reaching, from enhancing customer experiences to robust marketing and advanced security measures. By moving their portfolio into a managed card program, financial institutions address current challenges and position themselves at the forefront of future trends, ensuring a seamless and secure digital future for their cardholders.
Callen Holmes is a seasoned National Sales Executive with nearly a decade of expertise in credit card portfolio management. With a strong focus on needs assessments, business development and cultivating relationships, she is deeply passionate about empowering financial institutions to offer tailored products that meet the diverse needs of their client base. In her role at Primax, Callen combines her extensive experience with a keen understanding of market trends to drive growth and foster lasting partnerships.
