Non-bank lending businesses face a multitude of challenges that can hinder their growth and success. Lingering inefficiencies in traditional loan disbursement. A need to adapt to changing customer behaviors. And growing competition from digital lenders. This trio of challenges has combined to create an adapt-or-die operating environment for many non-bank lenders.

Common Frustrations Of Traditional Loan Disbursement

Issuing-as-a-Service (IaaS) offers a promising solution to each of these challenges, bringing innovation and efficiency to non-bank lending businesses. But before we look at the impact of IaaS, let's delve into the current pain points faced by non-bank lenders. Many are still operating in an environment characterized by:

• Legacy credit methods: Non-bank lenders in Thailand have traditionally delivered credit facilities to their consumer and business customers by issuing physical ATM cards. In such cases, borrowers often find themselves having to visit an ATM to withdraw cash, which can be cumbersome and inconvenient. The process limits how and where they can use their loan funds. Even for more modern non-bank lenders, the solution has been to offer virtual ATM cards integrated into mobile applications.

• Poor end-user experience: However, this approach still leaves users with the need to physically withdraw cash from ATMs, albeit through the app, limiting the flexibility and ‘spendability’ of the loan funds. These traditional methods have posed challenges regarding user experience and have not fully harnessed the potential for enhancing customer financial management.

• Limited transaction insights: Traditional cash card-based loan disbursement methods miss out on valuable opportunities to gain insights into customer spending habits. Understanding how borrowers use their funds can help lenders tailor their services, enhance the customer experience, and reduce risks associated with the misuse of funds.

• Intense competition: The lending industry is experiencing increased competition from new entrants and alternative financing options like Buy Now, Pay Later (BNPL) services. To remain competitive and meet the evolving needs of customers, non-bank lenders must innovate and adapt their offerings.

IaaS can provide a transformative solution that eases all of these pressures.

Talk to Opn today to start your IaaS journey.

How IaaS Can Help

A flexible issuing-as-a-service partner can support non-bank lenders to tap into:

• Virtual card issuance: IaaS introduces the concept of virtual card issuance, which can significantly improve the customer experience. Instead of waiting for a physical card to arrive, borrowers can receive a virtual card containing their loan amount instantly. This expedites the process and provides borrowers with immediate access to their funds.

• Spending insights: Virtual card issuing empowers lenders with the ability to gain valuable insights into how borrowers spend their loan amounts. By tracking spending patterns, lenders can tailor their services to better meet the financial needs of their customers and reduce risks associated with funds misuse.

• Flexible integration: IaaS provides lenders with the flexibility to create distinctive card programs through Application Programming Interfaces (APIs). This flexibility enables non-bank lenders to stand out in the competitive market by offering unique and tailored financial products and services.

• Program affordability: IaaS significantly reduces operational costs and time-to-market compared to in-house card program development. Instead of investing heavily in technology and compliance, non-bank lenders can rely on IaaS providers like Opn to handle these aspects, enabling cost savings and efficient program deployment.

Why Issuing Efforts May Have Failed Before

Many non-bank lenders know both these problems — and the ideal state they want to achieve. But their pursuit of a solution may have been frustrated by:

• Knowledge gaps: Gaps in in-house expertise may open up between scoping out issuing needs, roadmapping a start to the preferred program, and the technology, operational, and compliance needs.

• High maintenance costs: Unaffordability is common too. High maintenance costs may occur after non-bank lenders have committees significant funds and resources to run issuing themselves.

• Traditional issuing partners: Others have outsourced early only to be burned by the experience. Some legacy IaaS players do not have the flexible technology to offer a solution that snugly fits lenders’ existing stack and business model.

Why Should You Issue Cards to Borrowers with Opn?

Opn, a leading provider of IaaS, offers a range of compelling advantages for non-bank lending businesses looking to launch innovative card programs:

• Faster time-to-market: Opn's IaaS expedites the time-to-market for non-bank lenders. By leveraging Opn's expertise and technology, lenders can quickly deploy virtual card programs, ensuring that customers have swift access to their funds.

• Flexible ops and licensing: Opn's IaaS offers flexible operational and licensing models. Businesses can choose to operate with their own license or rely on Opn to manage the regulatory requirements. This flexibility enables lenders to adapt their operations to their unique needs and preferences.

• Expert localized support: Opn provides expert localized support to non-bank lenders, ensuring that they receive the guidance and assistance necessary for the successful launch and management of card programs. With Opn's support, lenders can navigate the complexities of the financial industry with confidence.

Non-bank lending businesses undergo a transformative period where innovation and efficiency are paramount. IaaS offers a solution that modernizes the lending landscape by providing virtual card capabilities, insights into borrower spending, flexible API integration, and cost-efficiency.

Opn stands as a strategic partner for non-bank lenders, offering faster time-to-market, flexible operational models, and expert localized support. With IaaS and Opn's guidance, non-bank lenders can revolutionize their businesses, offering tailored financial products that meet the evolving needs of their customers and stay competitive in a dynamic financial landscape.