Swift Prepaid Solutions serves markets that undergo regular disruption and any time a client changes, so must its cards.
To save on operations and get cards to market faster, the corporate incentive program manager works with Arroweye for on-demand card marketing and delivery.
"The industry has evolved and cards have become more customized; it became a requirement to find a partner who could do a lot of creative things using technology," said Brian Levin, chief financial officer at Swift.
Swift provides clients with a payment vehicle to incentivize consumers, distributors and employees. For example, if a consumer buys a product in store that comes with a rebate, Swift would send that rebate on a Visa card.
Swift started using Arroweye about five years ago. Arroweye designs card products with customized images and allows its clients to order small batches of cards to keep pace with demand.
Last year, the city of Oakland, Calif. used Arroweye's on-demand offering for a dual-purpose identification and payment card.
Before partnering with Arroweye, Swift was spending hundreds of thousands of dollars on pre-manufacturing its inventory, said Levin. Because Swift gets paid only when its client's customers use a card, Swift would sometimes wait up to 18 months to recover all the revenue on large orders of up to 50,000 cards, he said.
Plus, if a client wanted to redesign its card image and marketing material, some of the product would be destroyed and wasted.
"There's been a fundamental shift away from pre-manufacturing; it's become, 'Here's what I need today and that might change tomorrow or next month,'" Levin said.
For example, Swift works with several companies in the timeshare industry. These companies offer consumers cash incentives, primarily in the form of a Visa prepaid card, for listening to their two-hour sales pitch.
Several years ago, the industry saw a lot of consolidation, prompting companies to repeatedly rebrand, and then repackage their cards, said Levin. Instead of using a sunset image on the card, a company might decide to use an image of the inside of one of its properties, he said.
"We're constantly re-imaging cards or changing the branding to fit what our client wants," Levin said. Now, Swift can order 250 cards on demand, instead of thousands at a time.
Arroweye can get cards to clients in a few days, whereas pre-manufacturing large numbers of cards takes between six and eight weeks. "There is some cost savings but a ton of resource, capital savings by not throwing money at plastics and stocking," said Levin.
And this on-demand ordering is especially important as the U.S. migrates to EMV chip-cards. Arroweye launched EMV On-Demand, a customization platform for chip-cards, in October 2013.
"It's going to cost you ten times what it costs [for traditional mag-stripe cards] so those cards sitting around get expensive," said Render Dahiya, CEO of Arroweye.
Dahiya said Arroweye's solution could be beneficial for mid-tier banks transitioning small card portfolios to EMV for testing purposes. Banks that are issuing EMV cards as their mag-stripe cards expire could also benefit from Arroweye's on-demand services, he said.
"There's risk with all this payments change," said Dahiya. Most of Arroweye's clients are converting their entire portfolios but don't have to worry about spoilage, he said.
Arroweye also provides physical and electronic gift cards and greeting cards for retailers. "Nearly 50% of consumers buy a greeting card after they buy a gift card so now they can buy it all in one place," Dahiya said. "And consumers spend 20% more on our platform."
While the company's eGifting product started out as a consumer offering, it's become more of a business-to-business marketing application, Dahiya said.
Many businesses are using eGifts in their incentive programs for employees. Business-to-business rewards startup Kiind also serves this market, offering a platform where senders don't pay for the gift until the recipient uses it.