Synchology is in the business of issuing partner branded debit cards that earn rewards. Think of it as being very similar to the cobranded credit market except based around debit and prepaid. PaymentEye speaks to the company’s President and Co-Founder Doug Bobenhouse.
How would you sum up 2012 for synchology?
2012 for Synchology was all about developing Jump and The Branded Payments Platform. As a result, it was a relatively quiet year for us as we stayed out of sight building. However, 2013 will be a banner year for us with the unveiling of Jump and a number of programme developments also in the pipeline.
How does Synchology differ from its competitors?
We built The Branded Payments Platform to offer consumers solid money management tools, loyalty and reward features — things you would usually find in higher end market solutions, not in prepaid. We believe customers deserve a high-end opportunity to engage with their money. With banks slow to reinvent themselves in the face of technological changes, this is certainly an area where we can work to offer better options.
What would you say is the hottest trends in payments right now?
There is certainly a lot of white space available for user experience evolution. The large institutions within the industry have been slow to innovate on the interface front, which has left the door open for smaller firms like us to capitalise. Also, since the Durbin amendment limited the revenue large banks could make on debit interchange, many of them reduced or eliminated their debit reward programmes last year. We issue with a smaller bank unaffected by Durbin and can continue to fund reward value from interchange.
Mobile payments and QR codes are certainly trending at the moment. But if we look at the payment methods and initiatives adopted by companies such as Starbucks for example, the ultimate payment ends up as a traditional card or ACH transaction.
Tell me more about Jump
We have our own product called The Jump Card. It is a consumer direct Visa debit card with money management tools. The product offering is twofold – it is a direct to consumer solution. But it’s also a showcase of our white label ready platform for brands to adopt.
The Jump Card allows users to earn rewards for every dollar spent. It also provides them with a host of money management tools such as budget management; spend tracking and the ability to classify transactions. We don’t do account aggregation at the moment, so the focus is only on the one account.
We have a very transparent fee schedule. While most prepaid cards come with lengthy fee schedules, The Jump Card has one fee – $5(USD) monthly or $50(USD) annually. The measure of customer service calls has greatly diminished which is a testament to the great self-service aspect of Jump. Talks with prospective clients for the white label platform are currently underway.
I read a report by the UK payments council which suggests that payment trends may move away from debit and credit cards towards mobile focussed solutions in the future – do you see this happening?
I think it’s really all about access points in the transaction process. Debit and credit cards are access points mobile devices can be access points as well. In the US it seems the underlying accounts will be with banks for the foreseeable future.
What is your strategic focus going forward?
2013 is a big year for Synchology. We are partnering with loyalty and reward agencies to provide their clients with new customer touch points and a new reward earning vehicle. We’re also deeply integrated with a company called Cardlytics to provide targeted deals and offers back to the cardholder.
We’ll also be launching a mobile version of our platform which will provide customers with location based offers. There isn’t really anybody out there doing a white label reward debit product. Given what’s happening in the credit market today, I think this represents a great space for us to expand and go forward!
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