ICBA Payments and Mastercard will offer upgraded and optimised card and payment services for 1,400 community banks.
ICBA Payments, the payments arm of the Independent Community Bankers of America (ICBA), has partnered with Mastercard to improve card and payment services for community banks.
This partnership will bring new features to community bank services to modernize card programs and enhance customer experiences. Besides, the partnership with Mastercard will provide secure, cost-effective solutions to help member banks grow and support their neighbourhoods. This will contribute to stronger local economies and better customer retention.
ICBA Payments will upgrade its card programs to Mastercard at no extra cost, offering contactless cards, tokenization for digital wallets, and improved business BIN optimization. Mastercard will handle all cardholder communications and marketing during the transition, delivering customized marketing materials to boost cardholder activity.
ICBA Payments offers various card programs, including credit and debit card solutions, to support community banks. Their credit card program, in partnership with FIS, allows banks to issue tailored credit cards, providing flexibility and potential profitability. Similarly, the institution’s debit card solutions aim to help banks effectively leverage this important payment channel.
Upgrading these card programs is essential to keep pace with evolving consumer payment behaviours and technological advancements. For instance, one of the Federal Reserve’s recent surveys highlighted a notable shift towards increased card usage, with credit card payments growing at an annual rate of 9.9%. Besides, debit card issuers, including community banks, should prepare for the possible reduced fee cap for debit card interchange fees, which might take effect in June. If finalized, the amendments to Federal Reserve’s Regulation II would result in a nearly 30% decrease in the fee cap for average transactions. It challenges banks and credit unions to find alternative revenue sources or adjust their business models to maintain profitability.
ICBA serves around 1,400 community banks. Its client banks collectively represent over $43 billion in credit and debit sales. With 10 million cards issued, they rank as the 10th largest debit card issuer and 29th largest credit card issuer in the U.S.
ICBA Payments CEO Jacob Eisen explained that the latest joint initiative with Mastercard is not just about upgrading payments, but rather about investing in local communities. Marie Elizabeth Aloisi from Mastercard agreed that local communities are key to economic progress. Therefore, together, the firms are determined to help community banks drive financial empowerment and growth in the communities they serve.
