How Denmark’s most famous product is helping Nordic banks deliver

As consumer expectations of personalised services grow and competition gets tougher, banks throughout the Nordics and across Europe are turning to Denmark’s iconic toymaker for inspiration, says Nikolai Kjærsgaard Andersen, Director of Sales for Denmark at Tieto Banktech. 

Today’s consumers expect the same smooth, rapid service they find when shopping online from their bank – no matter if that’s checking their balance in the digital environment, or when paying with a card in-store. As consumer preferences become increasingly diverse and regulatory demands grow, banks in the Nordics and beyond are finding the answer in a manufacturer of plastic bricks based in Billund.  

Sticking the bits together 

How does a toy manufacturer influence a bank? By showing that it’s possible to put different parts together flexibly to deliver what’s needed as quickly and efficiently as possible. When it comes to payment cards – still preferred by 91% of Danes and used in 67% of transactions1 – banks are adopting a composable, platform-led approach to service design known as Cards as a Service, or CaaS.  

CaaS enables banks to move rapidly with the issurance of new products, since all aspects of issuing – from technical infrastructure to card production, network integration and transaction security – can be outsourced via a single API integration from your card services provider. As well as getting new products to market fast, this arrangement reduces the need for infrastructure and specialist staff, helping banks to control costs and improve efficiency.  

Here’s one we made earlier… 

At Tieto Banktech, we currently work with a Tier 1 Nordic bank to deliver products across nine different card portfolios in multiple markets using one administration tool, a single contract with the bank for all portfolios, and a multi-tenant approach which enables the bank and all of its subsidiaries to issue all kinds of payment product – from commercial cards to Apple Pay – via a single platform and interface.  

There are other advantages to issuing and managing cards using the “as a Service” model over and above these basics, especially when it comes to advanced features and services. Working with an experienced CaaS provider gives banks access to market-leading expertise in transaction security and regulatory guidance. That means your customers are protected and you receive advice on how to stay compliant and keep up with industry standards. 

Building a flexible financial future 

Working with a CaaS provider, banks can customise cards, from sustainable materials to personalised designs or notch cards for the visually impaired while ensuring all cards are consistent with the bank’s brand. All-important new features such as instant/virtual card issuance, BNPL and mobile walletscan also be quickly added to card programmes to keep your bank competitive.  

When it comes to innovation, the CaaS model makes it possible for your bank to partner with third parties to create innovative new products and bring them to market rapidly and with full security. In the employee benefits space, start-ups such as Brex and Ramp have partnered with banks and CaaS providers to create corporate expense cards for their clients, branded with the client’s logo, as part of a broad employee benefits offering.  

Meanwhile, European retail giants from Sainsburys (UK) through to Carrefour (France/Spain) and IKEA (Sweden) have worked with their banks and a CaaS provider to create own-branded BNPL products for use with store cards that are increasingly popular with consumers. When you put it all together, its clear that a modular, platform-based approach to card issuance and management can help you build the kind of bank your customers dream of.