Credit Card Issuer Processing: State of the Industry

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This report from Mercator Advisory Group, "Credit Card Issuer Processing: State of the Industry" is a review and discussion of the current state of the credit card processing service bureau industry in the United States. In this study, the major account management service providers to the credit card issuing industry are reviewed, including both traditional service bureaus and agent bank service bureaus. The history of the major players is examined, as are emerging solution providers.

Credit Card Issuer Processing: State of the Industry

This report from Mercator Advisory Group, "Credit Card Issuer Processing: State of the Industry" is a review and discussion of the current state of the credit card processing service bureau industry in the United States. In this study, the major account management service providers to the credit card issuing industry are reviewed, including both traditional service bureaus and agent bank service bureaus. The history of the major players is examined, as are emerging solution providers.

The research indicates that a prolonged period of software development and acquisition is over, signaling a new era of product innovation based on customer-centric products and services. Professional services in the form of strategic product consulting is being used to create increased value from the issuer/processor relationship, as service providers strive to become their clients trusted advisor and confidant in all aspects of portfolio management.

Patricia Hewitt, author of the report, states: "As the largest issuers only get larger, what will the impact be on the next tier issuers? The competition for a larger share of the mid-sized issuer segment will only become fiercer and in turn, these lenders will require more highly competitive products than ever before. In addition, the revenue model changes being forced on the industry by regulators will result in issuers looking for an increased ability to reduce risk, improve profitability, and derive more value out of their existing account base."

Report Highlights:

  • 1. The credit card issuer processing industry in the U.S. is reorganizing itself around a different set of market opportunities as the major issuers move to insource their portfolio processing.
  • 2. The issuing processing market has segmented itself into solutions designed to appeal to financial institutions based on credit card product strategy.
  • 3. Core banking solution providers are emerging as competitive forces in certain markets.
  • 4. Platform development has centered around the ability to decouple mainframe processes from business applications in order to deliver account information and processes on demand through dynamic integration points.
  • 5. Issuing processors are creating strategic business units to productize professional services in response to increasingly sophisticated toolsets, competitive and regulatory pressures on issuers.

This report contains 40 pages and has 13 exhibits.

Members of Mercator Advisory Group have access to this report as well as the upcoming research for the year ahead, presentations, analyst access and other membership benefits.

Please visit us online at http://www.mercatoradvisorygroup.com/.

For more information call Mercator Advisory Group's main line: 781-419-1700

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ROBERT MISASI
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