Credit Card Programs Are the Future for Community Financial Institutions

--> As community financial institutions continue to find innovative ways to compete with larger financial institutions, providing their members with banking services that can exceed their expectations is a great way to add value to the relationship and retain members. Recently, Nashville-based Studio Bank began to participate in Corserv’s Account Issuer program which provides the bank with all the tools and customizable capabilities to provide full-service credit cards to customers. Studio Bank has a relationship-based, tech-savvy and hospitality-inspired banking model that empowers creatives, entrepreneurs, and business leaders.  They were seeking a way to provide an enhanced credit card user experience with all the
 conveniences of the modern economy. Studio bank wanted their clients to be able to manage and issue new physical and virtual cards within their credit line, set alerts and spend controls, and work with ApplePay, Google Pay, and Samsung Pay. They wanted customer service included, but also the ability for the bank staff to service accounts and increase credit limits if needed. With the unique set of payment needs in mind, Corserv’s unique and comprehensive credit card program was the solution for Studio Bank. Corserv’s mission is to offer a turnkey credit card issuing program that enables community banks and credit unions to offer competitive card products to their clients, branded for the financial institution, with credit decisioning and P&L ownership by the financial institution, without adding staff and infrastructure.  Credit card programs can have a high return on assets (ROA) and are a sticky product which customers keep and re-use month after month. The Key to Innovation Offering branded credit cards to businesses and consumers can be a game changer for any community financial institution. Rather than utilizing an Agent Bank Model, Corserv works as a true partner to Studio Bank. This allows for more flexibility and customization, especially for banks like Studio Bank that have a special set of needs by serving a diverse range of business owners, leaders, and creatives. Because Corserv does not operate under the typical Agent Bank model, Corserv’s Account Issuer program uses a Sponsor Bank that leads compliance and issues the cards but enables Financial Institutions to have branded cards, participate in the credit decisions, and own the P&L. Benefits of the Account Issuer Program Through Corserv’s Account Issuer program, Studio Bank is able to provide their client base with innovative and unique payment solutions. Studio Bank can capitalize on the capabilities of the payment card issuing platform to improve relationships with customers, like enabling cardholders to set their own alerts and controls and enabling Bank staff to service customer accounts when needed. By owning the P&L including getting 100% of the interchange, interest, and fees on the cards, Studio Bank can realize the high ROA from credit cards rather than giving it to an Agent Bank. Studio Bank now utilizes many of the innovative features from Corserv’s Account Issuer Program that were not available to them in their former Agent Bank program, such as: Branding and Reporting: Studio Bank has control over branding of the card program for their bank including logos, colors, payment card images, splash screens and marketing messages to personalize the interface for their unique customers. Corserv’s features and program data can be accessed through Corserv’s APIs which enable Studio Bank to integrate it into their own user interfaces. (Confused about this sentence) Unlike an Agent Bank program, Studio Bank has full access to their cardholder and program data through the APIs, or through over 100 pre-defined customizable reports. Underwriting Services: Studio Bank is taking advantage of optimized single-page online applications, e-consent, credit checks, and automated real-time underwriting with a champion model from Corserv that takes advantage of relationship information from the bank’s clients (or take this out and end at information).. Studio Bank can work with Corserv to adjust the Champion Model if needed. For application decisions that can’t be automated, such as all commercial card applications, bank staff can participate in the credit underwriting through manual application review queues. Authorizations and Security: Corserv provides authorizations for real-time card payment transactions while constantly enhancing fraud prevention. Not only is Corserv PCI and SOC compliant, but Studio Bank’s cardholder data will be secured and protected with tokenization and encryption. Business Admin Interface: Through Corserv’s brandable browser-based interface, business owners and administrators can engage with several self-service features that are optimized for viewing on platforms including computers, tablets and mobile devices. Corserv supports multiple business administrator roles as well as a tiered structure for larger companies.  Business administrators can issue physical, virtual and ghost cards, turn cards on or off, set a credit limit and spend controls, receive alerts, manage expense reports, and access customizable reports for their business cards. Expense Reporting: Corserv’s program can export card transactions to popular expense reporting systems that Studio Bank’s business customers may be using. But to enhance the value of the Studio Bank business and commercial card program, Corserv provides their own expense reporting system to Studio Bank at no additional charge.  Studio Bank can provide this expense reporting system to their business customers that aren’t using one, or that want to replace their existing vendor and eliminate that cost.  Companies using a Studio Bank business or commercial card can have employees create and submit expense reports from Studio Bank credit cards as well as import transactions from other cards, capture expense receipts using their mobile phones, and input cash and mileage expenses. Expected Results Studio Bank has established strong relationships with the Nashville community which puts them at a competitive advantage over large banks. Studies show that local businesses, municipalities, and non-profits especially want to get a credit card from their local bank.  Through Corserv’s credit card program, Studio Bank can expect deeper relationships with customers, increased volume and profitability for their bank, and improved card products and service for their customers. About Author: Anil Goyal co-founded Corserv in 2009 and currently provides strategic leadership as the CEO. He has a deep background in risk management, marketing, technology, and portfolio optimization.

Previously, he held senior management roles at top credit card issuers, including Bank of America and Citibank. He provided strategic and analytic consulting services to American Express for consumer cards and student loan portfolios. He managed SunTrust Bank’s credit card program that was launched by First National Bank of Omaha. Anil earned a Ph.D. in Decision Sciences and M.S. in Operations Research from Rensselaer Polytechnic Institute. He earned a B.Tech. (Honors) from the Indian Institute of Technology.


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