Understanding Programmable Payments


New technology helps consumers manage an array of payment choices


Consumers have never had more ways to pay. The number of cards, accounts and apps people prefer to use in various scenarios is growing: debit, credit, person-to-person payments, health savings accounts and now crypto. Plus, microlending options such as buy now, pay later (BNPL) have added a new layer of choice and complexity to payment decisions.

Programmable payment technology can bring intelligence and clarity into the payment process. This modern payment innovation makes it easy to select the best payment option available and automatically route payments to that funding source. At its foundation, a programmable payments platform enables people to present the same card at every point of purchase – either physically or digitally – and yet gives them the option to pay through a variety of accounts and assets.

“Programmable payments is a pragmatic response to the fast-evolving digital payments landscape, helping financial institutions, fintechs and brands bring new value, convenience and choice to the millions of payment cards that consumers carry in their digital and physical wallets today,” said Sunil Sachdev, head of Fintech & Growth at Fiserv.  


How programmable payments work 

Programmable payments enable people to link multiple accounts and payment sources to a single payment card, making it easy for cardholders to track their money and enjoy the benefits of all their accounts without having to remember which funding source is the most ideal option for each transaction.

Accountholders can either designate in advance which funding source they would like to use for certain categories – such as always routing gasoline purchases to a rewards-earning card – or they can select the funding source following the transaction. Artificial intelligence and machine learning can play a role in recommending the ideal way to pay in a particular situation, lifting the decision burden from the cardholder while optimizing their cash flow.

For consumers, this means access to universal payment capabilities that add speed and simplicity to payments, while ensuring they are making smart payment choices. For banks, credit unions and fintechs, a programmable payments experience can add unique value that results in top-of-wallet status for their card. 

Today, Fiserv is working with strategic partners to fuel the adoption of programmable payments. 


IncumbentFI: Multitrack payments

IncumbentFI, a provider of processing services that streamline collaboration between card issuers and fintechs, is looking to shape the future with programmable payments. Fiserv has partnered with IncumbentFI to bring this technology to financial institutions and fintechs who leverage Fiserv card services.


“We tend to think of traditional payments as a single train track, where the payment path is linear, moves through processing one destination at a time and always concludes its journey at a single account,” said Mike Miroslaw, CEO of IncumbentFI. “Our programmable payments offering unlocks the ability to route transactions to any destination and connect in features, such as rewards and discounts that differentiate the card experience.”

Fiserv and IncumbentFI have worked together to create a “switch” in the payment track that redirects payments after authorization but before they have been processed, routing them through a dynamic processing engine that identifies the account selected by the consumer and funnels the payment to that funding source. 


Consumers use one payment card in every payment scenario and have access to a marketplace of unique features and apps that enhance their payment experience. Cardholders can add features such as cash back rewards, points exchange, discounts, budgeting or a crypto account to their card. Many of the add-on features become affiliated with a primary account, which positions the financial institution or fintech issued card as their primary choice for payment.

Bangor Savings Bank (a subsidiary of Bangor Bancorp, MHC), a Maine-based community bank, is currently rolling out a programmable payment offering to its customers. “Our cardholders will benefit from the convenience of having multiple funding options, including rewards points, when paying for everyday items, without the need to change how they pay today,” said Jamey Doughty, SVP and Chief Innovation Officer. “Bangor Savings Bank is proud to partner with IncumbentFI and to serve as the primary sponsor bank supporting fintechs that are launching programmable payment cards through IncumbentFI.”

The next innovation Bangor Savings Bank is looking to introduce would leverage Fiserv technology to provide a microlending option. Cardholders would be able to opt in to a low-cost subscription service that automatically extends a microloan to cover transactions that would otherwise generate an overdraft fee. 


Wedge: Access to assets

Wedge is another business bringing the dynamic or programmable payments concept to life. The first of its kind, Wedge is a smart debit card that lets users pay for everyday purchases with any asset at checkout. Using proprietary real-time financial routing technology, Wedge provides consumers direct access to any of their assets every time they spend with their card, including stocks, ETFs, cash, crypto and rewards. This enables Wedge users to capitalize on market movements in a simplified and streamlined way, enabling their dollars to go further than with traditional debit or credit products. 

“Wedge is on a mission to bring the power of the markets to everyone for everyday spending, and to bring consumers a new spending tool that can help make their dollars go farther. Wedge provides a frictionless payment experience that enables our users to have instant liquidity of any of the assets in their digital wallet – and for the first time-- give them the power to use these assets strategically at checkout,” said Billy Roberts, CEO, Wedge Financial.

“With Wedge, users are able to bring a new level of utility and value-creation to their spending experience, and to benefit from the seamless access to multiple asset types every time they use their card.”

Fiserv has partnered with Wedge to support the movement of funds in and out of consumers’ digital wallets. Soon, Wedge will also offer its services in AppMarket from Fiserv, providing a way for financial institutions to offer these capabilities to their accountholders.


A wide-open future

Programmable payments are a new frontier in payments technology, offering consumers financial advantages and maximum flexibility. Fiserv is helping connect financial institutions and fintechs to enable the new technology. The innovative, differentiated digital experiences that result will help change and support the way people move and manage their money – and shape the future of financial services.