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Stripe Issuing gets charge card programme

Stripe Issuing gets charge card programme

Stripe is adding a charge card programme to its commercial issuing product, enabling firms to distribute virtual or physical plastic that allow their customers to spend on credit rather than the funds in their accounts.

Since Stripe Issuing launched in 2018, platforms and fintechs have used it to create more than 100 million cards in the US, the UK, and the EU.

But, until now, Stripe-issued cards could only be used to spend money from a prefunded account. The expansion into charge cards allows platforms to offer these same users access to credit, providing them with new revenue streams and allowing them to offer new financing capabilities to their customers.

Stripe cites a recent Goldman Sachs survey which found that 77% of SMBs were concerned about access to financing.

However, despite the demand and the benefits to providers, building a credit offering from the ground up is hard, says Stripe, because platforms would need to things such as collect repayment, handle lending compliance, and navigate licensing requirements.

The charge card programme handles these issues out of the box, providing funds flows, network connections, printing, and integration APIs—and streamlines all the necessary compliance, bank partnerships, and ledgering.

Platforms do not need to fund the transaction immediately, and can instead send funds to Stripe after the settlement date.

Denise Ho, head of product for BaaS, Stripe, says: "Our new charge card allows fintechs and SaaS platforms to provide access to a reliable source of credit for the many small businesses they work with."

The offering is already live in beta in the US and being used by Ramp, Emburse, Karat, and Coast. It will soon be available in the UK and EU.

"Building a charge card program is a daunting task. Stripe provided immense value in planning and launching our program quickly, with a compliance-first design that we’re confident can scale to meet Ramp’s needs,” says Michael Cohen, VP, partnerships, Ramp.

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