In tough competition, how co-branded credit cards can create an army of brand evangelists

Hyperface is one of the pioneering brands offering contextual banking solutions in India, empowering brands, fintechs, and banks. It enables businesses to provide customized banking products that resonate with their consumers on a deeper level, particularly focusing on making the credit card experience smoother. It has led to the introduction of a one-of-a-kind ‘Definitive Credit Card Innovation’ platform, that has brought in a revolution in the way brands, banks, and fintech platforms approach card solutions. It has garnered seed funding of around $10.9 million, spearheaded by 3one4 Capital with the participation of investors such as Better Capital, Global Founders Capital, and newer investors such as Rebalance Angel Community, Groww, and Flipkart Ventures. At the NASSCOM India Fintech Awards in 2023, Hyperface was awarded the top spot in the retail banking category and is committed to offering exceptional services in the modernized digital-first credit card space. It has received recognition at the Global Fintech Fest 2023 and has been selected to be a member of the NPCI Partner Program.

In India’s diversified market, customer loyalty plays an important role in the success of a brand. Loyalty programs which were once limited to hotels and airlines, now have an impact on shopping and daily life. Business growth, programs that have millions of members is a common phenomenon and several brands intend to reach or surpass these crucial membership numbers. To make this process smoother and easier, financial products are tailored by Hyperface to enhance brand loyalty and customer engagement, thereby shaping the financial landscape. The banking sector is led by Hyperface with its ‘Credit-Cards-as-a-Service’ platform, enabling the swift deployment of co-branded credit card programs.

The launch of the ixigo- AU Bank Co-branded Credit Card has been facilitated by the company recently, redefining the credit card experience in India. Hyperface has also collaborated with Visa for co-branded credit card programs. The objective of Hyperface is to speed up credit card inclusion in India, with its dedication to the concept of embedded finance. Besides Hyperface has also entered into collaborations with Fab Money and Zaggle as technology partners. It has earned the VISA Business Excellence Award for its trailblazing approach.

In conversation with Adgully, Aishwarya Jaishankar, COO & Co-Founder, Hyperface, delves into the concept of a co-branded credit card, some of the USPs offered by these cards to both customers and partnering brands, how co-branded credit cards augment the customer experience surrounding benefits and rewards in comparison to traditional credit cards, how Hyperface approaches customization of co-branded credit cards for aligning with the branding and customer base of differing partners, and more.

What is a co-branded credit card? What are some of the USPs that these cards offer to both consumers and the partnering brands?

In the most simplistic sense, a co-branded credit card is a partnership between a bank and a brand, where the card bears both entities’ branding. Think of it as a personalized handshake between you and your favorite brands – targeted rewards, exclusive perks, and elevated experiences. It’s all about making your credit card experience not just transactional, but truly memorable and rewarding. Co-branded credit cards, when done right, can be a ‘win-win-win’ for all parties involved: as a customer, you enjoy tailored rewards and discounts specific to your preferred brand. For partnering brands, they are the perfect tool to deepen customer engagement, enhance brand visibility, and foster stronger brand affinity and loyalty. For the bank partner, it helps increase spending on the card, and ideally, emerge as the card of choice in the customer’s wallet.

How do co-branded credit cards enhance the customer experience regarding rewards and benefits compared to traditional credit cards?

Think of it as plain vanilla ice cream versus a sundae drizzled with your favorite toppings! Standard, predictable, and lacking that extra excitement versus an indulgent feast crafted just for you.

Does a frequent shopper on Myntra crave the same rewards as a frequent traveler on Vistara?

Unlikely. Co-branded credit cards go beyond the cookie-cutter one-size-fits-all approach of traditional cards – they understand that your shopping habits, travel preferences, and lifestyle are unique. That’s why they offer tailored rewards and benefits that speak directly to your interests and spending choices.

How does Hyperface approach the customization of co-branded credit cards to align with the branding and customer base of different partners?

Launching a co-branded credit card in India is tough, and managing it is even tougher! Consider this – If you are a brand wanting to launch your co-branded credit card, you need to find the right bank partner, work your way through the maze of regulations, bring in various partners to offer rewards, integrate the technology, and build a compelling customer proposition. The entire process can take 12-18 months.

At Hyperface, we crunch this into mere weeks! We hand-hold our brand partners through this entire process – we help them partner with the right banks, comply with banking, infosec, and data security regulations, and seamlessly integrate with banks through plug-and-play APIs, alongside a ready product suite with ready-to-go back-end integrations and great CX for a seamless, in-app card experience.

We helped launch the ixigo AU Credit Card – a co-branded credit card between ixigo, India’s leading travel platform, and AU Small Finance Bank, in just 10 weeks! And we have quite a few projects in the pipeline.

Could you share your success stories or case studies of co-branded credit cards that have significantly boosted customer engagement and loyalty?

One of the biggest success stories in India is the Amazon – ICICI Bank Credit Card. It’s an extremely simple yet powerful proposition of cashback on everything you spend, and its success lies in the huge customer base it has amassed.

Internationally, let’s consider Target, the leading US retailer, and its RedCard program. Target reveals that RedCard holders are among their most engaged guests, having saved over $9.7 billion over 12 years. These customers accounted for 18.3% of total sales, generating incremental sales of $4.6 billion for the 3 months ending October 2023.

The Delta SkyMiles American Express Card (U.S.) targets the loyal customers of Delta Airlines and is tailored to enrich their travel experiences while earning rewards. Delta revealed in June 2023 that spending on Delta co-branded credit cards was nearing 1% of U.S. GDP! These staggering numbers reflect the deep engagement and repeat patronage that is possible by building meaningful card experiences.

I am personally quite in favour of the co-branded credit cards of your favourite IPL team! Cricket in India is a religion, and the IPL has taken it to new heights. Imagine a co-branded credit card that allows your everyday spending to translate into free match tickets, team merchandise, or even better, a meeting with your favourite player! It could be a game-changer to deepen fan engagement - I hope Shah Rukh Khan is listening!

What impact do you foresee the rise of digital wallets and payment apps having on the future of co-branded credit cards?

While digital wallets and payment apps offer convenience, co-branded credit cards will continue to be relevant due to their distinct advantages in terms of brand loyalty and engagement. I bet that as our economy grows, new brands proliferate, and competition between brands for wallet share gets pronounced, co-branded credit cards will become powerful tools in a brand’s armory, creating an army of brand evangelists.

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