Tag: #metalcards

Fintechs e Oportunidades do Cartão Metálico na América Latina

View blog in English here.

As Fintechs espalharam-se globalmente durante a última década, criando raízes nos principais mercados financeiros como o Reino Unido ou os EUA. O mercado latino-americano de fintech ainda se encontrava atrasado em relação a esta tendência mundial; no entanto, é inegável que está hoje em franca expansão. Segundo a CB-Insights Research publicada em fevereiro de 2020, o investimento em fintechs na América Latina cresceu consideravelmente entre 2018 e 2019, e agora a região é o mercado mais quente de fintech. O Brasil lidera sem dúvida a região com o maior número de empresas fintech, seguido pelo México e a Colômbia. Os principais sub-sectores da fintech são pagamentos, bancos digitais (Neo-bancos), empréstimos e financiamento.

O principal impulsionador do notável crescimento na América Latina é a enorme mudança tecnológica: primeiro, pelo aumento da penetração da Internet, que ultrapassou 66% em 2019, em relação à média mundial de 53% de acordo com o Banco Mundial; segundo, pela penetração dos assinantes móveis que, de acordo com a GSMA Latino-Americana, representa quase 67% da população total da América Latina. Quase 80% utilizam os seus dispositivos móveis para aceder à Internet, com previsões estimadas em atingir 87% até 2025. Esta evolução tecnológica ajuda a aceder à enorme população não bancária e sub-bancária, para além das pequenas e médias empresas, cujos produtos e serviços digitais podem ser oferecidos.

Ao mesmo tempo, autoridades e reguladores em muitos destes países latino-americanos promulgaram regulamentos favoráveis à fintech com menores barreiras à entrada no mercado, identificando a fintech e os serviços financeiros digitais como uma forma de proporcionar um acesso financeiro alargado.

Finalmente, de acordo com a Finnovista, uma organização que impulsiona fintechs e startups na América Latina, os investidores internacionais mudaram-se para a região na qualidade de um espaço de investimento atractivo com um pico visto em 2018. Hoje, apesar da COVID-19 e da incerteza política em torno das administrações no Brasil e no México, a indústria fintech latino-americana é muito dinâmica. De acordo com a Latam Fintech Hub, angariou US$ 525M (US$ 249,3M em acções e US$ 275,7M em dívida) em 74 negócios no primeiro semestre de 2020, demonstrando que o investimento continuou apesar das turbulências.

Causar uma impressão com produtos inovadores

À medida que a pandemia continua e o impacto económico pós-COVID-19 continua a ser uma incógnita, muitas empresas fintech na América Latina podem estar sob pressão. No entanto, podem surgir grandes oportunidades para elas, enquanto a necessidade de serviços digitais aumenta repentinamente. As Fintechs poderão aproveitar esta situação única para alavancar os recursos, desafiar e diferenciar-se através de mais inovação e criatividade.

Enquanto o número de fintechs na América Latina está em expansão, as empresas de pesquisa de mercado sustentam que aqueles que causarem impressão quando iniciarem um novo negócio encontrarão o seu caminho através desta tempestade pandémica. Aqueles que serão capazes de atrair novos consumidores e de se ligarem ao seu público criando experiências únicas, se tornarão mais fortes através da adversidade. É aqui que a influência do cartão metálico pode entrar em jogo e fazer a diferença.

Neste contexto, um estudo recente do Aite Group sobre cartões de pagamento de metal da próxima geração mostra como nos EUA e na Europa os cartões de metal têm representado um meio chave para as instituições financeiras, fintechs e bancos digitais comunicarem com os seus clientes digitais, proporcionando uma experiência humana através de produtos premium.

Por exemplo, o México é um mercado favorável a observar em termos da adopção bem sucedida de produtos premium. A idade média no México é de 28 anos, tendo 41% da população entre os 25 e os 54 anos, o que representa uma base proveitosa de consumidores jovens e com conhecimentos tecnológicos. Estes jovens consumidores são atraídos não só pelos serviços digitais dos neo-bancos, mas também pelos seus benefícios globais que visam diferenciar-se, incluindo produtos específicos, tais como o formato legal dos cartões metálicos.

Cartões metálicos para impulsionar o crescimento da fintech

Os cartões de pagamento metálicos não são, de forma alguma, um conceito novo. Eles estão presentes no mercado há quase 20 anos. No entanto, a sua emissão foi originalmente direccionada para os segmentos de nível 1 e limitada aos segmentos de valor ultra-alto (UHNW).

Hoje em dia, o consumidor alvo dos cartões metálicos mudou. Isto é impulsionado por requisitos de segmentação e diferenciação, direccionados para a premiação da base de consumidores afluentes. Estão incluídos neste segmento millenials, um segmento altamente desejável para as fintechs. A Fintechs na Europa e no Reino Unido, entre outros, parecem ter contribuído para impulsionar a emissão de cartões metálicos, como um factor de forma única, integrando as mais recentes tecnologias EMV e contactless para inovar e competir com as ofertas convencionais dos bancos tradicionais.

Os cartões metálicos são atractivos para fintechs por diversas razões. O cartão metálico não só dá o “look and feel” que um cliente procura num produto, como também cria uma ligação emocional elevada onde o cliente tem a sensação de fazer parte de uma comunidade cool premium. O efeito de premiumization associado a benefícios específicos ligados à marca é a chave para uma experiência única do cliente. Os cartões metálicos são uma diferenciação que combina serviços digitais com um produto físico atractivo. Os cartões metálicos ajudam a criar um estatuto de topo de gama. Eles elevam o posicionamento da marca fintechs e a percepção que o cliente tem dela. De acordo com uma análise proprietária da CompoSecure, impulsionam volumes de transacção e gastos mais elevados, aumentam a retenção de clientes e, num círculo virtual, podem ajudar a contribuir para a aquisição de novos clientes. 

Romper o status quo

A América Latina está a seguir o exemplo das fintechs europeias, onde os casos de negócios apontam para a adopção de cartões metálicos como um motor de crescimento de negócios de êxito. As fintechs latino-americanas poderiam definir a sua própria oferta de inovação de produtos, de acordo com as suas especificidades de mercado regionais e locais e ecossistemas. O relatório do Aite Group conclui que os cartões metálicos poderiam ser um factor-chave para quebrar o status quo, especialmente numa região onde o segmento populacional de millenials é elevado, e onde a diferenciação e o “factor cool” são importantes.

Para mais informações sobre as melhores práticas de desafios comuns no âmbito da fintech e uma visão geral da emissão de cartões metálicos, convidamo-lo a descarregar o relatório completo do Aite Group encomendado pela CompoSecure LLC “A Competitive Edge for Fintech Issuers”.

Free Report on Benefits of Metal Payment Cards For Fintechs

Aite Group research report shows how metal cards can attract and retain customers

Somerset, New Jersey – March xx, 2021 –  CompoSecure, L.L.C., a pioneer and category leader in premium financial cards, today released Metal Cards: A Competitive Edge for Fintech Issuers, a report on the benefits of metal cards as part of a robust proposition to attract new cardholders. The report can be downloaded for free and was commissioned by CompoSecure and produced by Aite Group, a global research and advisory firm delivering comprehensive, actionable advice on business, technology and regulatory issues and their impact on the financial services industry.

”Fintech firms see card design and material decisions as critical to success when competing with traditional banks and credit unions worldwide,” said David Shipper, Senior Research Analyst at Aite Group. “These fintech firms attest to the fact that metal cards are well worth the higher price, citing higher revenue generated from new account growth, better activation and usage and increased cardholder retention.” 

The report identifies the key challenges fintech firms face when launching and managing card programs, including building trust, competing for customer attention, developing the right brand and product position, overcoming regulatory hurdles and selling products without a branch network. The report provides the best practices for launching a successful metal debit or credit card product and how it can attract cardholders and support a tiered structure that provides the most benefits to premium customers. 

“With increased competition between financial institutions, companies are looking for ways to stand out and attract new customers,” said Jon Wilk, CEO of CompoSecure. “Companies have an opportunity to build a relationship with their customers by offering a uniquely designed and customized metal card with a variety of material options and enhancements that would create a premium experience for the cardholder.” 

According to consumer research cited in the report, 65% of global consumers would choose a metal card over a plastic card when all benefits and rewards are the same. Key benefits of a metal card include:

Eco-friendly – Metal cards offer several environmental benefits. For instance, metal veneer cards are made with 75% recycled stainless steel.

ROI– There are key expense considerations for a metal card, including per-card cost, card personalization, card delivery or other expenses. However, the return on the investment is high, such as greater account acquisition, increased card activation, improved transaction revenue, heightened cardholder retention, and additional fee income.

Consumer demand– Plastic cards are unlikely to achieve the prestige inherent to a metal card regardless of the design.

• Brand exposure – Issuing a metal card can increase the number of online and social media mentions, providing ongoing benefits to the issuer’s brand and products.

To download the free report, please visit: https://www.composecure.com/competitive-edge-for-fintech-issuers

Fintech and Metal Card Opportunities in Latin America

View blog in Portuguese here.

Fintechs have spread globally over the past decade, taking root in major financial markets like the UK or the US. The Latin American fintech market was still behind compared to this worldwide trend; however, it is undeniably booming today. According to CB-Insights Research published in February 2020, the investment in fintechs in Latin America grew considerably from 2018 to 2019, and now the region is the hottest fintech marketplace. Brazil is without a doubt leading the region with the largest number of fintech companies, followed by Mexico and Colombia. The main sub-sectors in fintech are payments, digital banks (Neo-banks), loans and funding.

The main driver for the remarkable boom in Latin America is the massive technology shift: first, by increased internet penetration, which surpassed 66% in 2019, over the world average of 53% according to the World Bank; second, by the penetration of mobile subscribers which, according to GSMA Latin-American, accounts for nearly 67% of the total Latin American population. Nearly 80% use their mobile devices for the internet, with forecasts estimated to reach 87% by 2025. This technological evolution helps access the massive unbanked and underbanked populations, in addition to the small- to medium-sized businesses, which digital products and services can be offered.

At the same time, authorities and regulators in many of these Latin-American countries have enacted fintech-friendly regulations with lower market entry barriers, identifying fintech and digital financial services as a way to provide widespread financial access.

Finally, according to Finnovista, an organization that propels fintechs and startups in Latin-America, international investors have moved into the region as an attractive investment space with a peak seen in 2018. Today, despite COVID-19 and political uncertainty around administrations in Brazil and Mexico, the Latin-American fintech industry is very dynamic. According to Latam Fintech Hub, it raised US$ 525M (US $ 249.3M in equity and US $ 275.7M in debt) in 74 deals in the first half of 2020, showing that investment has continued despite turbulences. 

Make an impression with innovative products

As the pandemic continues and the post-COVID-19 economic impact remains to be seen, many fintech companies in Latin America may be under stress. However, great opportunities for them may arise while the need for digital services suddenly increases. Fintechs could seize this unique situation to leverage assets, challenge and differentiate themselves through more innovation and creativity. 

While the number of fintechs in Latin America is expanding, market research companies sustain that those who will make an impression when starting a new business will find their way through this pandemic storm. Those who will be able to attract new consumers and connect to their audience by creating unique experiences will grow stronger through the adversity. This is where metal card influence can come into play and make a difference. 

In this context, a recent Aite Group research paper on next-generation metal payment cards shows how in the US and Europe metal cards have represented a key medium for financial institutions, fintechs and digital banks to communicate with their digital customers, delivering a human experience through premium products.

For example, Mexico is a favorable market to watch in terms of the successful adoption of premium products. The average age in Mexico is 28, with 41% of the population being 25 to 54 years old, which represents a fruitful base of young, tech-savvy consumers. These young consumers are attracted not only by neo-banks’ digital services, but also by their overall benefits that aim at differentiating themselves, including specific products such as the cool form factor of metal cards.

Metal cards to drive fintech growth

Metal payment cards are by no means a new concept. They have been present in the marketplace for nearly 20 years. However, their issuance was originally targeted towards tier-one and limited to ultra-high-net-worth (UHNW) segments.

Today, the target consumer for metal cards has changed. This is driven by requirements for segmentation and differentiation, targeting the premiumization of the mass affluent consumer base. Included in this are millennials, a highly desirable segment for fintechs. Fintechs in Europe and the UK, among others, seem to have helped boost the issuance of metal variant card bodies, as a uniqueness form factor, integrating latest EMV and contactless technologies to innovate and compete against traditional incumbent banks offerings.

Metal cards are attractive for fintechs for many reasons. Not only does the metal card the “look and feel” that a customer is looking for in a product, but it also creates an elevated emotional connection where the customer has the feeling of being part of  a cool premium community. The premiumization effect associated with specific brand-connected benefits is key to a unique customer experience. Metal cards are a differentiation that combine digital services with an attractive physical product. Metal cards help create a top-of-wallet status. They elevate the fintechs brand positioning and the customer’s perception of it. According to a CompoSecure proprietary analysis, they drive higher transaction and spending volumes, increase customer retention and, in a virtual circle, can help contribute to new customer acquisition. 

Disrupt the status quo

Latin America is following the example of European fintechs, where business cases point to metal card adoption as a successful business growth driver. Latin American fintechs could define their own product innovation offering, in accordance with their regional and local market specificities and ecosystems. The Aite Group report concludes that metal cards could be a key driver to disrupt the status quo, especially in a region where the population segment of millennials is high, and where differentiation and “cool factor” are important.

For more information on best practices of common fintech challenges and an overview of metal card issuance, we invite you to down-load the full report of Aite Group commissioned by CompoSecure LLC “A Competitive Edge for Fintech Issuers”

Marketing & Customer Service During a Pandemic

We as marketers have faced many challenges over the past months. Where we would like to develop and implement cool and innovative ways to communicate with our audience, we have had to think very differently. In a sense, we have become responders ourselves. Businesses responding to disruption rely on communications to make sure critical partners, such as customers, vendors, employees and other stakeholders, know about changes being made. The messages being delivered need to strike the right balance between sharing relevant information, not divulging proprietary details and not overloading the recipients. In addition, strong and timely communication with customers demonstrates that we are in a “true partnership” versus a typical buyer and supplier relationship. Demonstrating and delivering your core values through communication to clients during a crisis can build a stronger foundation to grow the relationship over time.

Safety First

At CompoSecure, we made a deliberate shift in our internal and external communications to refocus on the safety of our employees, customers and community. The COVID-19 pandemic has taught us all that safety consists of much more than security guards and secure facilities, and a strong record on workplace safety in terms of accidents or lost-time. Safety at its core principle encompasses the health and well-being of our colleagues, customers and the community around us, which has never faced greater challenges in modern times. We have leveraged instant communication tools that deliver messaging across multiple channels (e.g., text, email, phone, video) to deliver updates to employees and customers on critical issues affecting employee health and safety and customer needs in real-time.

The CX (Customer Experience) Factor

The best companies are those that know and understand their customers. Especially now, while customers’ needs and expectations have changed so much and so quickly, we are paying attention to what those changes are.

Our Global Sales team has identified the top 3 challenges our customers and partners from around the world face as they consider launching a new metal card program during the COVID-19 crisis, and how we are addressing them

Challenge #1 – Seeing is Believing

The physical experience –being able to look, touch and feel the unique qualities of a metal card –together with professional interpretation, is critical to understanding the appeal and value of metal cards. The lack of face-to-face interaction makes this more difficult. In addition, creative and design decisions take longer than usual because our popular in-house design sessions are temporarily on hold.

To tackle this challenge, we have created digital relationships with our customers. We are able to keep moving due to simplified metal card samples, videos of a card in action and team video calls. These techniques are proving far more effective than sending traditional photos or PDF art files back and forth.

 

Challenge #2 – Timeline

Supply chain challenges have impacted production timelines for many businesses. For CompoSecure, the timeline impact stemmed largely from design development. To offset any delays, our team came up with innovative solutions that shortened the timeline by using simplified prototype samples. We developed front-only samples, which highlight the design and branding of the customer. This sample type can be turned around much faster and significantly speeds up the overall production schedule, while still providing the customer with a sample that addresses their needs.

Challenge #3 Forecasting Accuracy

Due to high unpredictability, the majority of businesses in today‘s climate are experiencing a big challenge in forecasting accuracy.  We had to adapt quickly and deliver new ways to accommodate last-minute changes in forecasted production quantities. For example, when one of our clients placed their launch order, they had to place an urgent follow-up order because the demand was more than 3X their forecasted quantities. We were better positioned to respond because we implemented shared weekly forecasts as a best practice with key clients that looked at current vault inventory volumes and observed changes in the acquisition, natural reissue and lost/stolen cards. This shared forecasting and outlook for the rest of the year were discussed by the client and CompoSecure teams every week to enable more nimble responses to changing demand.

Today and Tomorrow

Our most critical and challenging “marketing” task ahead will be navigating our business away from crisis communication to business-as-usual, whatever our business-as-usual eventually becomes, while maintaining the best practices highlighted above. Improved communication and data integration across the customer’s touchpoints, together with personalized and relevant content will enable us to be the most successful in delivering the optimized customer experience.