Instant Card Issuance in an EMV World

Bob Legters
Chief Data Officer of Banking and Payments
Posted on June 9, 2016


Immediate Card Delivery to Satisfy Customer Demand for Instant Gratification

In an increasingly real-time world, a few hours can be a very long time in debit card issuance – certainly long enough to lose a customer. The timelines for delivering the plastic into the hands of the end-customer have been shortening for years: from a few days to overnight. However, increasingly, any gap between signing the contract and delivering/activating the card presents an opportunity to lose the business you have just acquired. Customers now expect faster service levels and so are inclined to look elsewhere for financial institutions that can deliver basic services and products in the timeframe they have come to expect, i.e. immediately.

Straight Through Issuing

With the continued importance of the card, many banks are evaluating cutting to the chase and presenting cards to end-users as quickly as possible. Given consumer demand for instant gratification, the natural next step is to get a card into the hands of the cardholder immediately – this is instant issuance. Many big players have already rolled out instant issuance of cards across their branch networks and more are looking to follow their lead.

Why not allow customers to simply enter the branch to open a checking account, select a debit card of their choice, create a PIN and begin using their card immediately? And if a customer’s card is lost or damaged, why not just give them a new one on the spot? Instant issuance is the ability to produce fully compliant and instantly usable credit, debit or prepaid cards on-demand in the branch. Quite simply, come in to open an account and leave with your activated cards – no fuss, no delays and no chance for the competition to lure them away while you wait for snail-mail delivery.

It all sounds simple enough as the account on-boarding process has resolved any credit/KYC (Know Your Consumer) issues. But by minting cards on the spot, each branch effectively becomes a card production facility, albeit at a very low scale, and so stringent audit and regulatory requirements kick-in: each branch must maintain a vault of new cards with strictly controlled access; new hardware and software needs to be implemented to press and setup the cards; additional staff training is needed; etc. All of which comes with a cost, so it is worth carefully considering how many branches need the capability.

The EMV Factor

With the ongoing migration to EMV, the market has seen renewed interest in instant issuance. EMV has proved to be popular with consumers as it offers improved security and has a strong innovative image with end users. Offering conventional magnetic-stripe card instant issuance is clearly non-trivial. But whether you are transitioning from an established instant issuance program or launching the service for the first time, offering EMV-enabled instant issuance adds further complexity given the need to manage the chip-card itself.

To offer EMV enabled cards, financial institutions need to consider more than just card stocks, vaults and embossing hardware. An expert knowledge of EMV is needed to build the EMV profile parameters, EMV key management, EMV scripting, chip personalization, etc. However, instant issuance under EMV is fast becoming a necessary and a logistical addition to supporting the new chip cards.

The Joy of Instant

Instant issuance certainly plays into customers’ desire for real time, especially as it removes the final blockage to speedy account opening. Account origination is already a relatively quick service; credentials can be validated online and KYC is largely automated. Adding instant issuance is the fruit of all that automation by closing the loop and delivering the plastic immediately.

Cards are where the virtual financial world hits the physical world, and to deliver cards in real time means delivering cards face-to-face, i.e. in the branch. Despite the fact that the banking experience is increasingly online, the branch is still a necessity for some tasks. The instant issuance of cards is an example of how the branch can remain relevant to consumers. Offering an instance issuance service allows banks to uplift their marketing messages and engage meaningfully with customers.

Instant issuance is also a tool for maintaining the banks’ position as the primary financial institutions given the growth in disruptor organizations such as fintechs and traditional retailers offering competing financial services.  For these new entrants and online-only service providers, there is no business rationale for offering instant issuance. Even retailers, with established networks of branches cannot feasibly offer the service given the requirements. It is not just about adding the equipment and card storage vault in a crowded main street store, the regulatory and certification process and PCI compliance procedures are unjustifiable. These new players will necessarily keep to the delayed delivery of cards for the foreseeable future.

In many respects, instant issuance levels the playing field across the banking community. While rolling out the service is relatively complex, it is not prohibitively expensive and is highly scalable; smaller community banks and credit unions can use instant issuance as a strong differentiator as they can offer the same personalized service as the bigger players.

  • Will instant issuance prove to be a strong differentiator for traditional financial institutions?
  • Does the EMV migration complicate the drive for instant issuance?


How will instant issuance change customer perceptions of branch utility?

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Bob Legters
Chief Data Officer of Banking and Payments

For the past two decades, Bob has focused on products and services support for clients. He has spent 17 of those years in a leadership role with groups ranging from 5 to 200 employees. Bob’s unique experience allows him to efficiently operate at a level that exceeds the normal executive role of understanding and recognizing client and consumer needs in the payments space.