Marqeta is making it easier for payment card issuers to instantly provision a virtual payment card within a digital wallet through a new tokenization service.
The Oakland, Calif.-based startup’s Marqeta Tokenization-as-a-Service enables banks or fintechs to instantly add credit, debit or prepaid cards to a digital wallet by directly managing tokens instead of going through a third party, Marqeta announced on Tuesday.
The move marks the first time tokenization has been marketed as an a la carte service, according to Kevin Doerr, Marqeta’s chief product officer.
“We saw a clear gap in the market, where our tokenization technology could sit on top of a legacy platform and tokenize virtual cards that we didn’t directly issue,” Doerr said.
Marqeta in recent years has provided similar capabilities to a couple of issuers—JPMorgan Chase for virtual cards and Square Inc.’s Cash App—but it’s now developed a set of APIs that any financial services provider can access without going through a processor, Doerr said.
Recently coronavirus has spurred the need for immediate provisioning of mobile wallets so consumers can start spending without waiting for a physical card, and Marqeta responded to that demand by making tokenization a separate service.
“Customers will access Marqeta’s APIs directly to manage tokens, and the tokenization will sit between the issuer and the card networks to allow consumers to make tokenized payments,” Doerr explained.
Marqeta already has extensions to the card network certifications, so tokenization service users may add Apple Pay, Google Pay and Samsung Pay to wallets via tokens, he said.
Issuers can provision a payment card within a digital wallet in seconds through Marqeta’s new service, according to Doerr.
Issuers may also use Marqeta’s APIs to issue new tokens on demand, and when a device with a token is lost or stolen, issuers can disable the token but the physical card will still work, he said.
Marqeta expects to see its tokenization service used by banks expanding digital wallets, along with fintechs and others for expense management, POS lending and incentives and loyalty, according to Doerr.
Marqeta also it has expanded its existing Apple Pay and Google Pay integrations to Canada, Europe and Australia.
