By As the world becomes ever more reliant and driven by technology, what should banks consider when searching for a credit card processor?
Driven by a recent survey by Qualtrix showing that people on average own 2.5 cards, 62% of cardholders rate rewards as a key attribute when selecting a credit card and 51% also value the importance of customer service UK FinTech native cloud payment processor, Paymentology has set out its four quadrant approach to supporting both established and challenger banks looking for API processing integrations
“The goal for banks is to offer a frictionless experience that is packed with great rewards, alongside positive engagement opportunities. When it comes to credit cards, cardholders want to feel in control and feel valued,” claims CEO of Paymentology Shane O’Hara. “In addressing the needs and demands of clients we can identify four key areas of focus, Augmented Intelligence, Operational Efficiencies, Credit Scoring Efficiencies and driving Lifetime Value.”
Augmented Intelligence
Augmented Intelligence has already influenced the way in which it is possible to forecast the actions taken by cardholders, who are now in the driving seat and demand the most advanced interfaces to manage their money effectively.
By utilising augmented intelligence, banks can understand the spending behaviour and deliver a credit card product that meets both the needs and wants of customers. This opens a great opportunity for the bank as fees and charges applied to credit card transactions are highly profitable.
Fees are incurred at various stages of the transaction lifecycle and several players are involved in the authorisation and settlement process. Understanding how banks can maximise API fronted real-time revolving credit processing is important to deliver a product that sits right at the top of the cardholder’s wallet.
Improved operational processes
Cloud-native credit issuing processing has the power to achieve this. Choosing the right partner means banks are backed by data-driven decisions, have the potential to improve their banking operational processes, gain greater cardholder insight and deliver high-tech fraud prevention tools.
And with over 1 billion credit cards in circulation it is no surprise banks are rushing to issuer processors to deliver on cloud-based ecosystems that have optimisation capabilities and make the whole process internally easier. Revolving interest calculations, charge backs, custom fees, and interest rates as well as reporting functions for both regulatory and in-house requirements can all be configured at tier level.
Sophisticated fraud activity has increased in line with technological advances, and now represents a material cost impediment for banks. Critical to operational integrity is the integration of the latest real-time fraud monitoring methodology.
Credit scoring functionality
Credit scoring is key to assess the risk of the cardholder and determine whether a card holder is suitable for higher levels of financing or will likely not meet repayments. It collects the cardholder’s payment history and other profile information to determine the score suitability.
Credit scoring can be a very attractive added functionality as cardholders look to purchase higher value ticket items and gain more rewards. However, there are other purposes for credit scoring such as fraud scoring and debt management, including the effective promotion of other financial products by minimising risk.
Lifetime value
Customer loyalty programmes such as reward programmes, that include cashback and retail store points are an attractive offering. With the right approach to personalisation, loyalty programmes can have direct impact in the overall customer experience as consumer preferences change. With the right processor, banks can adapt their card programme to the evolving need of the customer. Accessing the correct data in real-time, at the point of sale, positions banks well for the development of new product suites aligned to customer demand. Equally, with access to relevant data, banks can easily assess and optimise existing programmes that are not profitable or in particular demand.
“We see banks improve their programmes by switching into cloud-native technology that allows them to get to know their customer and deliver products that offer value. At Paymentology we provide a first-class credit card solution, with seamless integration, delivering a cardholder experience way ahead of its time. In an increasingly competitive world, speed to market through proven API integrations is a key requirement of any programme,” says Shane O’Hara.
Details of the Qualtrics Report available at:
* https://www.qualtrics.com/customer-experience/credit-card-report/