While European, American and Chinese markets have largely found their digital banking champions in Revolut, Chime, and WeBank, competition in Southeast Asia’s digital banking remains fierce as regulators continue to roll out digital banking licenses to both neobanks and traditional countinghouses.

The pandemic proved to be a boon for e-wallet growth, and since then some of the region’s largest super apps and e-wallets have taken the leap into becoming licensed digital banks, including GXBank, Bank Jago, and SeaBank, with more to follow across the region.

However, while e-wallets thrived in the contactless era, the post-pandemic shift back to tactile and physical elements in the banking space as well as consumers’ increasing demand for more personalization has brought to the fore premium and metal offerings – as exhibited by neobank, Revolut, and its enticing Metal plans.

Hyper-personalization is the key

Anthony Ginolin, Vice President of Growth, APAC, Payment Services at French multinational tech giant IDEMIA Secure Transactions, believes this trend is already making its way to Southeast Asia, where both traditional brick-and-mortar institutions and challenger banks are constantly finding ways to differentiate themselves from competitors while addressing the needs of an increasingly discerning customer base.

Noting the level of competition in more developed banking markets, Ginolin said, “In North America, some of the biggest fintech issuers release new premium products every six months, and many are finding it challenging to iterate more and more, faster and faster.

“Consumers’ demand for hyper-personalization goes beyond simply owning a metal card; it’s having the possibility to choose from multiple designs and options. It’s a powerful marketing tool that evokes an emotional response, not dissimilar to the highly-anticipated release of a new iPhone every year. Owning such metal card invokes a feel-good factor that becomes associated with the bank.”

He told Fintech News Singapore in an interview recently.

This observation aligns with a recent (2024) consumer survey conducted by the renowned research agency Dentsu Insights. The survey, which examined the latest trends in consumer payment behavior across the globe, found that 72% of consumers consider card design important, while an impressive 81% value the option to customize the artwork on their card.

Could the answer to standing out from the madding crowd really be as simple as getting the Ultimate Metal Art (UMA) card, weighing in at a whopping 22 grams, which IDEMIA launched last year? Physical cards in the digital era, really? Not just for high-net-worth clients, but also for the mass affluent? Yes and yes, say Gen Z and Millennials.

The same study found that 83% of consumers worldwide would be interested in having a metal card, with 57% willing to pay for one. 67% of respondents cited the elegant look and feel as their reason, while nearly half mentioned the feeling of distinction. This number is even higher among GenZ and Millenials, with 88% of those aged between 18-37 years in the Asia Pacific region expressing interest.

It certainly drives spending, with a metal card increasingly rising to ‘top of the wallet’. The perceived higher social status and premium feel of such cards has nearly two-thirds of consumers using their metal card more often. 73% of consumers said that they would have a more positive perception of their bank if it offered a metal card. The premium look and feel contributed to this perception, with 69% of consumers valuing the durability and robustness of the card, and 26% being drawn to its heavy weight.

IDEMIA has been issuing metal cards since 2015. Building on the success of their Smart Metal Art card—the world’s first contactless metal payment card fully certified by Visa, Mastercard, and Amex—they have introduced other metal cards including the Smart Prime card, and now their latest addition, the UMA card. The UMA stands as the heaviest in IDEMIA’s portfolio and likely the heaviest, dual-interface, fully scheme-certified metal card on the market. It features a versatile design with a stainless steel and tungsten core encased in protective layers on both sides to maximize durability and longevity. This innovation not only enables unparalleled double-sided contactless transactions for a metal card but also offers that sensory experience—weight and sound—for those who value a premium experience.

Higher revenue, willingness to spend

For issuers wondering if metal cards are worth the extra production costs, Ginolin has figures to back up IDEMIA’s claims that they generate higher revenue for issuers:

“A major issuer that offers both physical and digital offerings found that once they moved users from their old PVC card to metal – including a digital version of the card – they saw the same user-base spend 15-20% more on average.”

In some cases, issuers that IDEMIA has worked with, found that consumers are happy to pay to personalize their metal cards – and once they have done so, are more likely to use the card for their larger ticket items, and more often.

“The manufacturing of the card itself is more expensive compared to PVC, but the customisation costs are marginal. Some of those customisations can be charged to customers. One of our issuers released a metal card with the option of having your name laser engraved on the card with a special font. It’s a cursive font that’s very sexy, very good looking. They charged US$5 for this – and 80% of the customers willingly paid for this option when signing up for the card. More than just a nice-to-have, it’s also a revenue driver for the banks, because the premium offering encourages people to spend more, and when doing so, using their premium card,”

Ginolin stated.

Make it metal, but green

Why bring up sustainability when discussing metal cards? According to Ginolin, this topic arises systematically during discussions with issuers exploring metal card options. Consumers today are increasingly aware of sustainability issues. In fact, the same survey revealed that 69% of consumers prefer eco-friendly card options. This raises a valid concern: wouldn’t a metal card be less sustainable, especially in a digital-first era? IDEMIA, which previously launched Malaysia’s first recycled PVC card, is bringing that sustainability element to its metal card offerings as well.

“Our metal cards are made mostly of stainless steel, which is a fairly sustainable material. We have also integrated a certain percentage of recycled metal in the core of our metal cards. Everything – including the cards’ recycled or sustainable metal content – is certified through independent labs.

Moreover, our metal cards received validation this year from UL Solutions—a global leader in applied safety sciences offering testing, inspection, and certification services—for our recycled content claim. We are committed to delivering top-notch quality while prioritizing sustainable practices and empowering our customers to do the same when issuing metal cards. Even if metal cards are premium, nothing prevents them from being sustainable,”

Ginolin said.

IDEMIA’s ability to bring about the convergence of the physical and the digital worlds extends to the sustainability space, as it has developed a green API. Via GREENPAY WALLET, IDEMIA is active in sustainability and regenerative action and gives its customers the ability to actively contribute to planet regenerative projects and track their impact over time.

“Now, we can turn a metal card—or any card—into an actual active tool for sustainability with regenerative actions tied to the card program, empowering users to do consistent good through card usage. This is where we want to go beyond the product itself, to create mechanisms and technologies that help the users achieve more than just offsetting emissions or performing a fixed action, per se. Ultimately, the product itself being sustainable is one thing, but more important is how the banks bundle products together with meaningful actions that will make those products, regardless of the material, green, sustainable, and true to the values of a bank, and of course, key business drivers.”

Ginolin added.

With the increasing number of players and offers in the banking and payment space, we are beginning to see a clearer segmentation within the wealthy customer base (aspiring affluent, mass affluent, affluent, etc.), with issuers aiming to capture them before their competitors do.

Personalized premium products, such as metal cards, are an extremely relevant way to attract these segments, especially in a digitized world where you want your physical link with your issuer to be top-tier. This race will likely become one where the goal is to avoid being the last one to act!