Secure your future: 6 reasons to modernize your credit card technology
Looking to stand out in the credit card market? Complacency isn’t an option. In an industry that’s crowded with incumbent powerhouses and fintech disruptors, it’s not enough to use the same outdated technology as everyone else.
While legacy technology helped power the initial growth and popularity of credit cards, it also led to a lack of differentiation in the market. Since most financial institutions (FIs) built their products using the same handful of legacy providers, many credit cards ended up with unremarkable propositions: many cards have the same limitations, the same unexciting features, and the same operational challenges.
There’s one way to break out of the sea of sameness and secure your organization’s future. Leave legacy behind and build your next credit card product on a modern platform.
The meaning of modern
This begs a natural question. What is a “modern” platform for credit card issuance and processing, and what makes it different from a legacy system? Simply put, it’s one that’s built for today’s customers using today’s technology.
Legacy platforms stand out for their rigidity and inflexibility. Many of them were designed well before the Internet age, built with outdated servers and mainframes that need to be run in on-site facilities and maintained using languages like COBOL. There’s plenty to admire about legacy technology’s foundational role in the payments industry—but the market needs new solutions, and outdated systems aren’t getting any younger.
Meanwhile, a modern issuance and processing platform is built for change. It’s designed to support unlimited modularity, so that you can pick and choose the functionality you need without having to support dozens of unnecessary features. Actions and updates are performed in real time, so you can respond to market trends and needs as they arise.
These capabilities are made possible through 21st-century innovations like application programming interfaces (APIs) and cloud-based infrastructure. APIs empower you to simplify implementation by only coding against the APIs for the features they want; meanwhile, cloud technology allows you to enjoy the benefits of robust payments technology with extra security, scalability, and resiliency. These digital-first characteristics give these platforms a distinct edge.
Key reasons to modernize
Wondering whether it’s worth sticking with your legacy credit card technology provider, or if it’s time to make a change? Here are a few key reasons to make the switch to a modern platform.
1. Accelerate speed to market
When you’re developing against a legacy system, you have to think like engineers from decades ago. It requires working with outdated code and rigid infrastructure. If you’ve come up with an idea for a cutting-edge credit card, you might need to devote months on your roadmap just to figuring out how to map it against your old technology.
By design, a modern platform can support modern use cases. Cloud-native and API-based configurability means that your platform will be able to accommodate new features as needed. This built-in flexibility can empower you to accelerate your development timeline, allowing you to introduce new products while supercharging your speed to market.
2. Gain a competitive edge
There’s no two ways about: credit card issuing and processing isn’t a simple job. It requires total configurability over a range of credit features: credit limits, repayment processes, interest forgiveness eligibility, rewards distribution, and so much more. Maintaining control over these many moving parts is critical for success. While legacy platforms offer rigid and difficult-to-use tools to accomplish these tasks, cloud-based systems make it seamless to manage every aspect of your platform through a single interface.
By leveraging adaptable APIs and configurable infrastructure, you’re empowered to build the exact product you want—no compromises required. With these capabilities in your arsenal, you can deliver a product that can not only compete, but lead the market.
3. Lower risk
While they might sound secure on paper, legacy systems actually pose serious risks. After all, outdated technologies may not have the same level of support or data protection provided by newer hardware and software. Additionally, when old technology goes out of service, it’s easier for cyber threats and criminals to gain access.
Meanwhile, modern platforms feature security protocols designed to address today’s unique challenges. Cloud-based architecture ensures that data is always available when, where, and how you need it, while features like encryption services and role-based access restrictions certify that only authorized personnel can access your sensitive information. With safety measures like these in place, you can mitigate costly data breaches and protect your customers’ information.
4. Reduce expenses
Running a credit card program can be expensive. However, many of those expenses can be avoided. Legacy platforms introduce billions of dollars of expense for global FIs every year: IDC research found that FI spending on legacy payments technology will increase to $57.1 billion in 2028, up from $36.7 billion in 2022, with an average growth rate of 7.8%.
By shifting to a cloud-native platform, you’re cutting those expenses right out of the equation. You’re freeing up thousands, if not millions of dollars that would’ve gone to legacy technology maintenance. These funds are then able to be used instead for new product development, transformational change, and other process improvements.
5. Grow customers and revenue
These efficiencies add up. By accelerating your product roadmap, reducing expenses, maximizing efficiencies, and lowering risk, you’re setting yourself up for explosive growth.
The data backs up this claim: IDC finds that banks that adopt new technology can increase their annual revenue by 42%. It’s simple. Modernized credit cards are a ticket to institutional improvement and long-term growth for your organization.
6. Simplify data integration and access
Data plays a vital part in running a credit card program. Not only will you need to access information from external sources, such as fraud decisioning partners, but you’ll also need to collect and expose data for features such as statements and credit bureau reporting. Outdated systems tend to be highly siloed—information exists solely within the system’s architecture, or it doesn’t exist at all. Building integrations with these siloes can require challenging long-term development cycles, limiting your planned roadmap.
Digital-first systems are designed to enable interoperability and integration with any platform or data source. In this way, you’re given free rein to access and connect to the data you need to run your product. Gone are tedious integration cycles; instead, your platform facilitates the necessary connections right out of the box. Simplified integrations can free your development resources to focus on what matters: supporting and expanding your product, on your schedule.
Secure your future. Today.
Ensure your credit card product is ready for the future, today. If you’re ready to get started with modernization, there’s no need to go it alone.
At E6, we have a proven track record of supporting FIs with modern credit card issuing and processing solutions. Our solutions can be decoupled from your existing core, allowing you to reap the benefits of a 21st-century tech stack without disrupting ongoing operations.
Ready to kickstart your modernization journey? Contact us now.