The issuer processing market continues to show a clear divergence in performance between fintech-oriented and bank-oriented issuer processors. Fintech-focused processors are still achieving strong, double-digit revenue growth, while bank-oriented processors are experiencing more modest, low single-digit increases. However, growth across both segments has slowed compared to their five-year CAGRs, reflecting a broader normalization in the market.

1. Issuer Processing 2024 Revenue

(2024, in $ millions)

2. 2023 - 2024 Revenue Growth                              3. 2019 - 2024 Revenue CAGR

General Commentary & Highlights 

• Fintech-oriented issuer processors continue to report strong, double-digit growth, whereas bank-oriented processors posted low single-digit growth rates. 
• 2023 – 2024 growth rates down across the board vs. 5-year CAGR.
  

4. Issuer Processors 2024 EBIT Margin

(% of 2024 revenue)

4. Issuer Processors Revenue vs. Profitability Growth

(2023-2024)

General Commentary & Highlights 

• Bank-oriented issuer processors exhibit attractive, double-digit EBIT margins.
• Many Fintech-oriented issuer processors are loss-making, illustrating the challenges of scaling in the fintech segment of the market, which is small relative to the bank market.
• Thredd and Marqeta made significant strides to improve profitability, with EBIT growth  significantly exceeding revenue growth.

Please do not hesitate to contact Erik Howell at Erik@FlagshipAP.com with comments and questions.