How collaboration between Authorised Dealers and FinTechs can accelerate the issuance & Distribution of forex cards

With the gradual easing of restrictions in many parts of the world, there is a significant pent-up demand for travel, specifically a surge in demand for leisure travel. As per RBI’s Outward Remittance data, in FY 22-23, the outbound travel was USD$9948.42 billion YTD and is projected to hit USD$13 Billion, this is even after the various delay in visa issues that people are facing for countries like the US and some parts of the EU.

With the growth in travel, there is a great opportunity for full-fledged money changers, Authorised Dealers, Small Finance Banks and distributors who are witnessing dramatic recovery and are looking to reinvent their business models to foray into new markets, launch new services and forge technology partnerships with FinTech players to help grow their business. As per regulations, travellers are allowed to carry only USD$3000 in cash and the rest needs to be loaded in a forex/pre-paid card.

This opens up a huge opportunity for Issuers of Forex/multi-currency cards who can own the customer and the full revenue from it along with branding. By collaborating with FinTech companies, the Issuers can leverage Fintech’s technology to simplify and accelerate the issuance of forex cards, making it easier for their travellers to obtain these cards and use them for their international travel needs. They can go to market within a couple of months as against almost a year with legacy players, the partnership is most of the time focused on per transaction cost making it a win-win for both the Issuers and the FinTech players. Furthermore, these FinTech players come with their expertise and domain knowledge and offer highly configurable and feature-rich technology in compliance with the regulatory landscape.

The money changers ecosystem by working closely with the FinTech community will get access to technology systems like a switch with connectivity to Visa or Mastercard (BIN); Multi-Currency Card Management System with all features to onboard customers, issue cards, load / reload FCY in multiple currencies and a Mobile App for ease of transaction for their travellers.

Furthermore, FinTech players can also help with compliance and regulatory aspects prescribed for their license and offer operations services like Recon, Settlement, Customer service, dispute management, reporting etc. This helps bring Authorised Dealers and money changers/distributors a comprehensive one-stop solution to either issue or distribute Forex/Multi-currency cards in both physical and digital models.

Overall the benefits that FinTech collaborations can offer:

Integration with banking systems: FinTech players have integrated their applications with banking systems to facilitate the transfer of funds from the customer’s account to the forex card account. This integration can also enable customers to reload their forex cards using their bank accounts on the fly.

Security features: They incorporate security features such as EMV Chip and encryption to ensure that customer data is secure and protected from fraud.

Online Application Process: Fintech companies in India have simplified the application process for forex cards by offering an online application process. Customers can apply for a forex card online, upload their KYC documents, and get their forex card delivered to their doorstep or across the counter of the bank branches.

Real-time KYC Verification: They use advanced technology to verify customers’ KYC documents in real-time, reducing the time taken to issue a forex card. This helps speed up the issuance process and makes it more convenient for customers.

Digital Verification: They use digital verification methods to validate customer identity and reduce the need for physical documents. This makes the process faster and more efficient.

Customization: They offer customized forex cards that cater to customers’ specific needs, such as destination currency and spending limits. Customers can choose the features they require and get a personalized forex card. Customers have the option to convert the foreign currency to Indian Rupees and use it upon their return from abroad.

Mobile Apps: They offer mobile apps that allow customers to manage their forex cards, check their balances, and view their transaction history. This makes it easier for customers to monitor their spending and manage their forex cards on the go.

Customer support: They offer customer support through their applications, chatbots, or call centres. This support can assist customers in case of issues such as lost or stolen cards, transaction disputes, and account management.

Card management: They provide customers with tools to manage their forex card accounts, such as balance checks, transaction history, and card blocking in case of theft or loss.

Overall, fintech companies in India are leveraging technology to make the issuance of forex cards faster, more efficient, and more convenient for Authorised Dealers, helping travellers with ease of travel. This is helping to promote the use of forex cards among Indians who travel abroad, making it easier for them to manage their finances while travelling.

(The author is Mr. Vineet Saxena, Co-Founder, CARD91, and the views expressed in this article are his own)