Sitting in a meeting in New York City, Clay Wilkes put his company’s latest innovation to the test. “We onboarded a company, funded the master funding account, created an individual account, and moved funds from the master funding account, and bought a gift card on Amazon,” he recalls. “Someone in the meeting received the card and went out and bought something.”
All that, Wilkes recalls, took two to three minutes. That’s “compared to nine to 18 months to get all of what I just said done,” he adds, with conventional methods.
The fast rise of non-traditional industries and services is pressuring the payments industry to invent new and swifter funding channels, and the founder and chief executive of Salt Lake City, Utah-based Galileo Financial Technologies Inc., says his company is ready. Galileo announced last week it is launching Instant Issuing, a service that allows developers to use a portal called Galileo Dashboard to access the company’s application programming interfaces to create instant debit cards.
Though Galileo only went public with the dashboard a few days ago, fintechs, challenger banks, gig-economy service providers, and others are already showing interest in using the APIs to pay workers with Mastercard-branded debit cards. “The demand is extremely high for this type of product,” says Wilkes. So far, he says, nearly 20 companies have contacted Galileo about the service.
“Companies that do shipping, logistics, or even cruise lines could issue a digital card as part of creating an account for someone and provide pay or petty cash to remote workers or to gig workers who want instant access to wages,” notes Ben Jackson, who follows the market as chief operating officer at the Washington, D.C.-based Innovative Payments Association.
Speed of funding is also key. Payments companies ranging from Mastercard to Fiserv to Ingo Money and Zestful have seen a need to bring faster funding to workers who otherwise don’t have access to cards or even conventional bank accounts. Now, Wilkes says, companies that want to meet that need have a do-it-yourself tool that lets them get products into market swiftly. “We think there’s a tremendous market opportunity,” he says. “It’s easily accessible in a time-to-market kind of way for companies. The applicability of that is very large.”
Emerging card issuers, too, can harness the dashboard to create branded card programs. “The developer community is front and center for this product,” Wilkes says.
Physical cards can also be churned out fast, Wilkes adds, because of the company’s arrangements with a pair of card printers that he prefers not to name. These cards can be delivered to users within two to four days, though customization may extend that time.
But for some observers, the big potential lies with the immediacy of the digital cards. “If the cards can be provisioned into digital wallets that allow for point-of-sale transactions or cardless ATM withdrawals, then the instant-issue card can provide immediate access to most functions offered by a plastic card,” says the IPA’s Jackson.
Wilkes won’t discuss details of the revenue arrangements behind the new service, but the clear advantage to developers and other clients is faster access to interchange income. “We’re providing a revenue share that’s volume-based,” he says. “A percentage of interchange revenue will be paid out to clients.”
That arrangement could become more attractive if the new portal makes instant debit cards with instant funding a commonplace option for employers, merchants, and promotional companies. “I think Galileo’s approach to let developers link in with its platform via APIs potentially makes it easier for companies to build instant issuances into their product suite,” says Jackson. “So, it could make instant issuance a standard option rather than a special request.”