Next-Gen Capabilities That Will Help Credit Unions and Banks Build Cards of the Future
As American cardholders demand greater control and flexibility in their credit cards, digital-first disruptors and early adopter Credit Unions and Banks are changing the competitive landscape of card experiences. From on-card BNPL to digital wallets that link seamlessly with debit and credit products, fintechs or big techs with no dependence on legacy systems are already touching 4 out of 10 US customers.
Rising concerns about the competitiveness of their cards is pushing credit unions to prioritize modernizing their issuer processing cores. An important aspect of this is defining the capabilities they need to build.
Next-generation card technology is inherently connected, scalable, and composable, allowing credit unions to deliver a unified experience to their members across product types (debit, credit, prepaid or BNPL) and touch points (transactions, services, distribution, etc.)
Image 1: The issuer processing stack of the future
Let’s look at the key capabilities that differentiate next-gen processing and help issuers overcome shortcomings of legacy systems to achieve this vision.
- Microservices-driven headless architecture with API-first, extensible object models
- Cloud-native infrastructure with near-infinite scalability
- Omnistack for asset and liability products enabling the construction of both asset and liability products on the same platform
- Config-as-code through web-based interfaces and modern intuitive UX for real-time changes via configuration and not code, unleashing significant speed in product creation
- Extreme integrability using APIs, events, webhooks, interceptors
- Real-time transaction processing and settlement with almost no downtime
- Flexible data models supporting supporting one-to-many, many-to-many, and many-to-one relationships between entities
- Rich and multi-modal data access to enable real-time analytics that improve decision making, embed contextual nudges in cardholder journeys, and build segmented offerings
- True ‘segment-of-one’ product construction using hyper-personalized pricing (fee and interest) at program, member, account or transaction level
With these foundations, a truly next-gen issuer processing stack extends a credit union’s or a bank’s ability to build a vibrant ecosystem to deliver seamless, omnichannel digital experiences for members.
Let’s look at some of the innovative use cases in the cards market today, which can be enabled by next-gen processing:
● Seamless provisioning of digital cards into digital wallets for easy online and offline transactions
● Enriched transaction statements with real merchant names, additional merchant details, and the ability to add personal notes for more meaningful spend insights
● Digital cards with enhanced controls to allow members to set location controls, spend limits, and even merchant-level controls
● Aggregated visibility and control across related accounts and products level (for example, a family hub that allows primary cardholders to control features and access for dependent cardholders)
● One-time or limited validity virtual cards for enhanced security for online transactions, one-time payments, or to avoid accidental recurring charges on subscriptions.
● Enhanced card security features, such as support for multiple methods of authentication, including PINs, OTPs, device tokens, etc.
In the near term, we also see a significant case for AI-driven use cases, whether for alternative credit risk assessment or as tools/virtual coaches for members who want to build up their credit scores.
Accenture’s modeling of global profitability data shows that incremental improvements in digital operational maturity can lead to a 17% improvement in in EBITDA profits, while leapfrogging stages to become future-ready can enhance profits by 48%. As banks and credit unions undertake the expense and risk of modernizing their issuer processor cores, they need to ensure that the strategy goes deeper than lift-and-shift to the cloud or adopting digital solutions in individual functions.
Fundamentally, the adoption of a next-gen issuer processing platform is about changing the way a bank or a credit union runs its cards business, reimagines business models, and launches products for the future. This is not possible with approaches like hollowing out legacy cores or layering on top of legacy technology.
A bold new future awaits credit unions and banks that are able to make this transformative leap, building on the right set of next-gen capabilities.
At Zeta, Gary is responsible for the company's North American business, including go-to market, operations, growth and overall financial performance.
Prior to Zeta, Gary was the Chief Revenue Officer at Ondot Systems (acquired by Fiserv in 2021), a leading digital experience platform for financial institutions in use by over 4,500 banks and credit units globally. Gary's team led the digitization of card and transaction services at large banks such as HSBC, Citi, BMO, NFCU, Barclays U.S. and managed the business and technical partnerships at all major core banking and payment processors, including Fiserv, First Data (pre-merger), FIS, Worldpay (premerger), Bread Financial, COOP, PSCU and ELAN's payment processing unit (prior to acquisition by Fiserv). His team also managed the relationship and technical integrations at major mobile banking partners such as NCR, Kony/Temenos, 02, Alkami and each of the respective processors (Fiserv, FIS, PSCU) mobile banking divisions.
A 20+ year silicon valley industry veteran, Gary has had the good fortune to build and work at companies that transformed their respective industries. In the past, he held executive level positions at Obopay (pioneered p2p payments in the US), Nokia Financials Services (pioneered banking on mobile in emerging markets for under/unbanked populations) and Aruba Networks (Pioneered Wifi in enterprise and higher education markets). He has over a decade of experience at Zebra (through multiple acquisitions - Motorola Solutions enterprise division & Symbol technologies), where he helped pioneer the market to automate and digitize supply-chain operations.
Gary lives in the Bay Area, California, holds multiple patents in the mobile and wireless industry and graduated with a bachelor's degree from Punjab University, India.
Connect with Gary: Linkedin
1 McKinsey, The great divergence - McKinsey Global Banking Annual Review 2021 | December 2021
 EBITDA: Earnings Before Interest, Tax, Depreciation and Amortization
 Accenture, Elevate Decisions: Future Ready Banking Operations | April 2021