On-demand access requires more card choices

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It’s no secret why consumers flocked to delivery services during the months of quarantine. On-demand access to food and essential items provided a lifeline to people who needed to avoid risky public interactions.

But there is more to the growth of on-demand delivery companies like Instacart and DoorDash than the global health crisis. What is happening behind the scenes is a fundamental shift in how people pay for not only food or grocery delivery — but for everything.

It’s easy to dismiss payment cards as an old technology. On the surface the 16-digit cards are little changed from the Diners Club charge card first issued in 1950. But payment cards have always been about more than their PANs, or primary account numbers. What has defined payment cards for more than the last half century is the infrastructure behind the cards. And that infrastructure has changed dramatically.

The modern card issuing platforms that enable online delivery giants like Instacart, DoorDash and Postmates to dispatch armies of drivers, shoppers, and couriers are unique in their customizability. They empower companies to create their own bespoke payment instruments while allowing for fast, secure and flexible transactions at scale.

A digital world requires digital payments, so it’s no surprise that the first step in the modernization of the payment industry was the issuance of virtual cards. These new payment instruments abstracted debit cards, credit cards and prepaid gift and incentive cards down to their essence.

They offered the advantage of speed — they could be programmatically issued in an instant — and simplicity. Developers could easily understand how to integrate virtual payments into their applications using open payment APIs. Instead of being a point of friction, payments became part of broader digital experiences and workflows.

Virtual cards made it possible to manage payments with much more control. Like physical cards created on a modern card-issuing platform, virtual cards could be embedded with spend controls that defined when, where and how a card could be used. Moreover, virtual cards could be created for a single authorized use, eliminating opportunities for fraudulent charges to be added to a card later. For the first time, it was not only possible but feasible to issue a custom card for every transaction.

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