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The API-based issuer-processor, which enables clients including Affirm, DoorDash, and Kabbage to issue their own physical and virtual payment cards, announced that it will issue its 140 millionth card in December.
The company also noted that if it were counted as a singular card issuer it would be one of the 25 biggest payment card issuers in the US. Marqeta’s performance has continued to surge, with its revenue doubling in 2019 — the fourth straight year it’s done so — and payments volume through its platform tripling.
The issuer-processor is positioned to grow its business even further after raising funding and expanding internationally in 2019.
Marqeta closed a Series E funding round worth $260 million in 2019 at a valuation of almost $2 billion. The round was reportedly oversubscribed, leading the firm to be selective about its partners, and the funding was earmarked for expansion to new regions and launching new cards. These efforts could propel Marqeta’s performance to new heights as they should help it reach new companies and issue more cards than its current total of around 140 million.
The company has been aggressively growing its presence in new markets, opening itself up to new business. Marqeta introduced a new product in Europe to enable clients to develop digital banking solutions, partnered with a company that can help it expand its reach in Europe by simplifying the process for starting a card program, and signed up new clients in the region.
Meanwhile, Marqeta also announced a partnership with Visa that will see the firms offer tools to help firms develop payment applications in Asia Pacific (APAC). Targeting both of these regions should help Marqeta attract new clients and business, and as it extends to even more markets its number of cards and volume should rise even further.
Marqeta will need to prepare for increased competition in order to thrive going forward because more firms are adding comparable issuing products. Adyen recently introduced Adyen Issuing, which lets clients issue virtual and physical cards, and payments technology provider Galileo debuted a new service that enables firms to instantly issue Mastercard-branded debit cards.
Both of these services should compete with Marqeta’s business, and because Adyen and Galileo have clients that work with them for other products, they may have the inside track on capturing their issuing business. To combat this, it’s important that Marqeta consider developing more offerings so its clients can rely on it for more services, which could stop them from looking for other issuing options. This may be particularly necessary because we predict that at least one major processor will move further into issuing in 2020, adding more serious competition for Marqeta.
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