Electronic assignment of account numbers points to the future of credit and debit.
The demand for digital issuance is growing.
This ability to assign an account number electronically is key to the future of cards.
“The experience of issuing a card digitally, saving your member from having to come into the branch or wait for a card to arrive in the mail, is a game changer for our industry,” emphasizes Scott Young, VP/innovation and design for CUESolutions provider PSCU, St. Petersburg, Florida. “We’ve all examined the ramifications of COVID-19 on the financial services world. Specifically, the pandemic brought to the forefront consumer demands for more digital convenience—especially within our culture of immediacy. We want products and services that are fast, convenient, safe and on-demand.”
While some lenders had digital card issuance in place pre-pandemic, others moved the process up on their priority lists in 2020.
The Benefits for Members
Young cites travelers or those who live abroad as members who benefit from digital issuance.
“There were credit union members who needed a new debit or credit card—or one replaced if a plastic were lost or stolen. Many branches were closed during the pandemic, and overseas mail was slow. Individuals couldn’t just walk into a branch or have a card mailed expeditiously,” he says. “Digital issuance solved and continues to solve this problem by affording the member the ability to receive new card credentials immediately—and ensure uninterrupted usage of their account.”
Young believes digital issuance will continue to be consumers’ expectation in the post-pandemic era.
The Benefits for Credit Unions
For CUs, digital issuance presents numerous advantages. In addition to being able to serve members expeditiously, not waiting for plastic helps ensure the CU’s card number will continue to be the primary one members use in their digital wallets.
“This is especially critical if a card is lost or stolen,” notes Young. “A credit union can issue a new card number and credentials for immediate insertion into the member’s mobile wallet. It’s then available for instant access—and considerably lessens the possibility of a member switching cards in their wallet.”
CUs can use PSCU’s DX Mobile card management app to do digital issuance. The app “encourages contactless payments, serving as a direct link to any of ‘the pays’ (Apple, Google or Samsung), which can reduce card attrition by allowing for uninterrupted spend of the member’s account.”
Using the app also reduces the chance of fraud. With a mobile wallet, “the card credentials used to authorize the transaction are tokenized and cannot be compromised,” Young explains. “It is the safest way to use your card account for payment.”
The End of Physical Cards?
Members’ mobile wallet adoption rate matters.
“Because credit unions were early adopters of ‘the pays,’ mobile wallet usage has always been higher, currently 49% for credit union members versus 28% for non-credit union members,” says Young. “And, because of this faster adoption, the natural next step is to encourage contactless payments.”
It’s possible that someday the entire payments stream could go digital and contactless—with no plastic card issued at all.
“When more merchants accept mobile wallet payments, we may eventually see fewer plastics issued,” notes Young. “Consider the Apple credit card issuance experience. It’s extremely fast, and you’re asked at the onset if you want a physical plastic (card) or [to] remain digital-card-only. It’s not difficult to see a time ... when physical cards become somewhat obsolete due to the increased utility and adoption of mobile wallets, wearables and biometric payments.”
It’s all about meeting the evolving expectations of our members, concludes Young. “Digital issuance helps fulfill the pillars of the member experience; it’s safe, convenient, easy to use and fast. If digital issuance can incorporate these four factors, it’s a win for our credit unions—and their members.” cues icon
Owner of Fab Prose & Professional Writing, Stephanie Schwenn Sebring assists credit unions, industry suppliers and any company wanting great content and a clear brand voice. Follow her on Twitter @fabprose.