Issuers Race to Win Spending Before the Card Arrives
Waiting for a physical card to arrive is becoming less relevant to the moment when an issuer can start competing for a cardholder’s spending. PYMNTS Intelligence’s “Issuer Engagement Playbook,” produced in collaboration with Visa DPS, finds that 59% of U.S. card issuers now offer automated or real-time card issuance to digital wallets, up from 32% […] The post Issuers Race to Win Spending Before…
The rapid rise of issuers offering instant card issuance to digital wallets is reshaping the relationship between card issuers and their processors. A PYMNTS Intelligence survey of 500 U.S. card issuer executives found that 59% now provide automated or real-time card issuance, up from 32% a year prior. This shift is already influencing the issuer-processor relationship, with two-thirds of issuers citing instant issuance as a key factor in selecting a processor, just ahead of dynamic CVV and digital-wallet integration capabilities.
Among high-value issuers, real-time wallet issuance usage jumped from 40% to 66% in a year, while medium and low-CLTV issuers saw increases from 35% to 68% and 26% to 50%, respectively. The spread of instant issuance across performance tiers is reducing processors' ability to treat it as a premium feature.
Once a card is provisioned immediately, other processor capabilities like wallet integration, transaction notifications, and security features become crucial. Issuers investing in these areas see a 56% focus on improving approval and onboarding to boost customer lifetime value (CLTV), followed by 54% on enhancing mobile and app experiences, and 51% on fraud prevention to reduce cardholder friction.
High-CLTV issuers use early-lifecycle interventions like welcome nudges, first-transaction prompts, and early-spend bonuses at a 40% rate, compared to 24% for low-CLTV issuers. They also rely on churn-prediction analytics more frequently, at 51% versus 35%. Instant issuance enables these strategies to begin immediately after activation, eliminating the wait for a physical card.
For processors, this trend means a broader set of interconnected capabilities defines their relationship with issuers. The report notes that issuers may switch processors if they cannot deliver real-time wallet issuance, making it a baseline capability rather than a differentiator. Processors must now focus on how well they support issuers' post-activation strategies to maintain their competitive edge.
Written by urgent.news from PYMNTS's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
