Banks and fintechs have the potential to become distributors of payment services to industries across the board using Cards-as-a-Service (CaaS) to unlock new revenue streams and drive the digital economy’s growth. Exploring this in further detail, Paymentoloy, the global issuer processor; audax, the digital banking tech solutions provider backed by Standard Chartered; and Mastercard, the payment tech and network provider, have published a new report.
The report, titled Understanding Cards-as-a-Service (CaaS) and the Power of Strategic Partnerships, reveals how CaaS enables financial institutions to streamline card issuance, enhance operational efficiency, and improve customer experience to stay competitive in the digital era.
The findings from the report come as the global payment processing market is expected to grow from $55trillon in 2024 to $79trillion by 2029, at a compound annual growth rate (CAGR) of seven per cent. Paymentology, audax and Mastercard found that while the Middle East is emerging as a region of significant opportunity, currently the Asia Pacific (APAC) and Latin America regions are leading the way.
Merusha Naidu, global head of partnerships at Paymentology said: “The launch of this report comes at a crucial time for financial institutions looking to stay ahead in the rapidly changing payments landscape. CaaS is not just a new model; it’s a strategic imperative for banks and fintechs aiming to streamline operations, accelerate time-to-market, and create personalised payment solutions.”
Success through partnerships
CaaS is going to play a key role in reshaping the payments market as it will be able to reduce the time-to-revenue by up to 50 per cent compared to traditional methods. In turn, this will mean newer issuers are able to benefit from card programmes much sooner. In addition to the report, Paymentology, audax and Mastercard will also be working together to deliver a comprehensive and secure CaaS platform.
They will provide financial institutions with the tools to simplify and accelerate card issuance, ultimately positioning the firms to act as powerful enablers of digital transformation in payments. This will be achieved by utilising Paymentology’s card processing capabilities, audax’s end-to-end banking solutions for digital card programmes and Mastercard’s global merchant network.
Mike Breen, chief commercial officer at audax added: “CaaS isn’t just about operational efficiency—it’s a strategic pivot that enables banks and fintechs to unlock new revenue streams, meet the expectations of digital-first consumers, and future-proof their payment capabilities. Through our partnership with Paymentology and Mastercard, we’re empowering institutions to deliver seamless, innovative card solutions with agility and scale.”
Driving value: case studies
The report includes case studies showcasing past successful implementations of CaaS by banks, fintechs and platforms. It illustrates how this model has empowered them to adapt to shifting market dynamics and rising customer expectations. These case studies provide tangible examples of how CaaS has driven value, such as:
- Instant issuance and flexibility: CaaS enables businesses to issue and manage payment cards with speed (launching in days instead of weeks), removing the need for costly and time-consuming traditional models.
- Rapid time-to-market: Through cloud-based infrastructure, CaaS solutions reduce the time required to launch card programmes, giving financial institutions a competitive edge.
- Operational efficiency: CaaS offers seamless scalability, allowing institutions to expand their card programmes without the resource-intensive overhead of legacy systems.
- New revenue opportunities: By adopting CaaS, financial institutions can tap into new revenue streams, offering tailored card solutions to a diverse range of industries.
- Enhanced customer experience: Personalisation and convenience are at the heart of CaaS, helping businesses meet evolving customer expectations while maintaining the highest security standards.
Gaurang Shah, executive vice president, product and engineering, EEMEA, Mastercard said: “CaaS represents a game-changing approach to card issuance and payment services, allowing financial institutions to meet the growing demand for flexible, digital-first solutions. By leveraging this model, institutions can focus on customer engagement and innovation, while their CaaS partners handle the operational complexities.”
