In the fast-moving world of digital payments, launching a card programme, whether virtual or physical, requires more than just an idea. Businesses looking to issue debit, credit, prepaid, or virtual cards have several routes to enter the market. The right approach depends on regulatory requirements, business model, and desired level of control.
The main card issuance methods available on the market today, include:
The most common cases are direct issuing payment cards and BIN sponsorships, which allow businesses to issue various types of payment cards.
We have previously written a detailed blog post about direct card issuing, covering its benefits, challenges, and how businesses can become direct issuers with Visa, Mastercard, or other networks.
Let’s focus on BIN sponsorship in this article, its definition, requirements, benefits, and challenges.
A Bank Identification Number (BIN), also known as a Banking Identification Number, is the first 6-8 digits of a payment card number, used to identify the issuing institution. BIN sponsorship is a model where an established financial institution with a principal membership from card networks (such as Visa, Mastercard, or American Express) allows a third party — typically a FinTech or payment company to issue cards under its umbrella.
Instead of becoming a direct card issuer, which requires regulatory approvals and extensive financial infrastructure, businesses can partner with a BIN sponsor to access the necessary capabilities while focusing on product development and customer acquisition.
While both card issuing and BIN sponsorship are essential in the payment ecosystem, they serve distinct roles in enabling businesses to issue and manage payment cards.
| Feature | Card Issuing | BIN Sponsorship |
|---|---|---|
| Definition | The process of issuing debit, credit, or prepaid cards directly to customers. The entity responsible for card issuing is typically a financial institution. | A partnership model where a licensed financial institution allows a fintech or payment provider to use its BIN to issue cards without becoming a direct issuer. |
| Who Does It? | Licensed banks or financial institutions with direct membership in card networks like Visa, Mastercard, or American Express. | Banks or financial institutions acting as BIN sponsors for third-party fintechs, neobanks, and payment companies. |
| Regulatory Status | Requires a principal membership with a card network and compliance with financial regulations. | The fintech company does not need direct regulatory approval but must follow compliance rules set by the BIN sponsor. |
| Compliance Responsibility | The issuer handles KYC, AML, fraud monitoring, and risk management. | The BIN sponsor ensures compliance, while the FinTech partner focuses on branding, customer experience, and product features. |
| Time to Market | Long (can take years to obtain direct issuing licences and set up infrastructure). | Shorter (months), since the fintech leverages an existing BIN sponsor’s regulatory approvals. |
| Cost & Investment | High (licensing, compliance, infrastructure, and risk management costs). | Lower cost, as the fintech does not need to become a direct issuer. Revenue is shared with the BIN sponsor. |
| Control & Customisation | Full control over pricing, card features, and transaction approvals. | Limited control, as the BIN sponsor dictates compliance, settlement processes, and sometimes pricing. |
| Common Users | Banks, digital banks, and large-scale fintech companies that can afford full compliance and regulatory approval. | Startups, fintechs, neobanks, and embedded finance providers looking for a fast and cost-effective way to issue cards. |
Direct card issuing refers to the process of directly issuing payment cards as a licensed financial institution with all necessary regulatory approvals.
In contrast, BIN sponsorship provides an alternative pathway where FinTechs can offer card products by leveraging a sponsor’s existing regulatory approvals and financial infrastructure without becoming direct issuers themselves. This arrangement is particularly attractive to FinTechs seeking to accelerate their market entry, as it allows them to focus on their core technology and customer experience while relying on an established banking partner to handle compliance requirements and provide network access. BIN sponsorship creates a symbiotic relationship that enables innovation while maintaining regulatory standards through partnership with experienced financial institutions.
BIN sponsorship offers multiple benefits, making it an attractive option for fintech companies looking to enter the card issuance market quickly.
Becoming a direct card issuer requires extensive regulatory approval, compliance frameworks, and financial reserves. BIN sponsorship allows fintechs to bypass these barriers and launch products in months rather than years.
Payment regulations vary by region and are often complex. A BIN sponsor ensures adherence to Know Your Customer (KYC), Anti-Money Laundering (AML), and transaction monitoring rules, reducing the fintech’s compliance burden.
Direct issuer licences can be expensive to maintain. BIN sponsorship provides a cost-effective route for startups by leveraging the sponsor’s infrastructure and network relationships.
A principal membership with Visa or Mastercard requires rigorous vetting and high transaction volumes. With a BIN sponsor, fintechs can access worldwide card networks without needing to secure direct approval.
Card fraud and chargeback handling are critical components of payment processing. A BIN sponsor provides risk management frameworks, helping fintechs operate securely without the need to build fraud prevention tools from scratch.
BIN sponsorship enables fintechs, neobanks, and payment service providers to issue cards without obtaining a direct issuing license. However, financial institutions acting as BIN sponsors set strict requirements to ensure regulatory compliance and risk management.
While BIN sponsorship offers many advantages, fintechs must be aware of the challenges and limitations that come with it.
By avoiding direct scheme membership, fintech businesses can reduce costs and simplify the complexities of launching payment solutions.
The sponsoring institution holds final authority over compliance, risk management, and transaction approvals. This may limit a fintech’s ability to introduce innovative features or customise the user experience fully.
Since the BIN sponsor provides key services, fintechs typically share a portion of the revenue generated from card transactions, interchange fees, and account maintenance.
Any operational changes, regulatory issues, or policy shifts on the sponsor’s side can directly impact the fintech’s card programme. Choosing a reliable and transparent sponsor is crucial.
Selecting the right BIN sponsor can define the success of a fintech’s card programme. Partnering with BIN sponsors allows businesses to leverage the established payment processing infrastructure of major card networks like Visa and Mastercard. Here are key factors to consider:
Ensure the sponsor has partnerships with major card schemes like Visa, Mastercard, or the relevant networks needed for your business.
A good BIN sponsor should have a strong track record in compliance, ensuring seamless adherence to local and international financial regulations.
Consider whether the sponsor provides cross-border issuance and supports multiple currencies if your business operates globally.
Understand the costs involved, including setup fees, transaction fees, and revenue-sharing models.
For fintechs building custom digital experiences, the BIN sponsor should offer robust APIs that integrate seamlessly with existing platforms.
Several financial institutions and service providers offer BIN sponsorship to help fintech companies and businesses issue payment cards without obtaining a direct issuing license. Here are some notable BIN sponsors:
BIN sponsorship fees vary based on the sponsoring bank, card network (Visa, Mastercard, etc.), region, and service scope. These fees generally cover compliance, licensing, card issuance, transaction processing, and regulatory oversight. They also include costs related to payment processing, which simplifies and streamlines transactions by improving speed, accuracy, and providing access to extensive payment networks and infrastructure.
The cost structure typically includes the following:
| Fee Type | Description | Estimated range |
|---|---|---|
| Setup fee | One-time cost to onboard the fintech, set up BINs, and integrate with card networks. | $10,000 – $50,000 |
| Monthly BIN maintenance fee | Ongoing fee for maintaining BIN allocation and compliance support. | $2,000 – $10,000/month |
| Per card issuance fee | Cost for issuing physical or virtual cards, including manufacturing and delivery. | $2 – $10 per card |
| Transaction fees | Processing costs per transaction (including interchange, network, and issuer fees). | 0.1% – 2% of transaction value |
| Revenue share | Some BIN sponsors take a percentage of interchange revenue. | 10% – 50% of interchange fees |
| Chargeback handling fee | Fees for handling disputes and chargebacks. | $15 – $50 per dispute |
| Compliance & KYC fees | Regulatory checks, fraud prevention, and anti-money laundering (AML) monitoring. | Varies ($0.10 – $1 per KYC check) |
Here are some real-world scenarios where BIN sponsorship plays a crucial role:
Example: A digital-only bank like Revolut or Monzo
Use Case:
Outcome: The neobank quickly enters the market with branded cards and compliance handled by the BIN sponsor.
Example: Brex, Ramp, or Pleo
Use Case:
Outcome: Businesses automate expense management while ensuring compliance through the BIN sponsor.
Example: Uber, Shopify Balance, or AirBnB payouts
Use Case:
Outcome: The company enhances customer loyalty and monetizes financial transactions without needing a banking license.
Example: Wise (formerly TransferWise) or Revolut travel cards
Use Case:
Outcome: Travelers enjoy seamless payments worldwide, while the fintech leverages BIN sponsorship to scale internationally.
Example: Stripe, Square, or Adyen
Outcome: Small businesses can accept card payments via the fintech’s platform without needing direct acquirer status.
Example: Crypto.com, Binance Card, or Coinbase Card
Outcome: Users can spend cryptocurrency globally while ensuring regulatory compliance through the BIN sponsor.
Example: Klarna, Affirm, or Afterpay
Outcome: Consumers enjoy seamless deferred payments while merchants benefit from increased conversions.
BIN sponsorship allows FinTechs and businesses to issue payment cards, process transactions, and scale financial services without heavy regulatory burdens. Whether for neobanks, embedded finance, travel FinTechs, crypto payments, or BNPL solutions, BIN sponsorship remains a strategic enabler for innovation in digital finance.
Launching a card issuing program can be complex, requiring regulatory approvals, compliance with payment networks, and technical integration. SDK.finance simplifies this process by providing a ready-to-go solution with pre-integrated BIN sponsors like Marqeta, allowing businesses to issue payment cards quickly and efficiently.
With SDK.finance, you don’t need to worry about compliance, technical complexity, or regulatory approvals. Our pre-built BIN sponsor integrations make card issuance simpler, faster, and more accessible for fintech innovators.
Ready to launch your own payment card program? Contact us today to get started!
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