Using BaaS Interchange to Subsidize Subscriptions
Andy Su, co-founder of Pry, on how fintechs choose the right BaaS partners
Card issuing changes the math of an FP&A product from software that charges every customer up front into software that can subsidize itself from payment volume. For Pry, that means a startup paying $50 to $400 per month for planning software could also run vendor spend through virtual cards, letting Pry collect a slice of interchange and use it to lower subscription prices while making the product stickier inside day to day finance workflows.
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The workflow Pry is aiming at is very concrete, set a budget for a vendor, issue a dedicated virtual card for that vendor, then let transactions reconcile back into the plan. That is why free or very cheap virtual cards matter so much, because per card fees can wipe out the thin margin on small and mid sized customers.
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The revenue pool is meaningful in B2B. A typical commercial card transaction can carry about 2.5% interchange across the stack, with the fintech often targeting around 1% or more at scale. Andy Su described an ideal where the customer gets 1.5% cash back, Pry keeps about 0.1%, and the rest goes to the BaaS provider and bank.
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This is the same playbook that helped Brex and Ramp offer free cards and spend software, then expand into bill pay, travel, procurement, and treasury. Ramp now mixes interchange with SaaS and other fintech revenue streams, which shows how a card program can start as a pricing lever and become the center of a broader finance suite.
The next step is more finance software turning cards into both a workflow primitive and a monetization layer. As BaaS tooling keeps shortening launch times, the winners in startup finance will be the products that tie planning, approval, payment, and reconciliation into one loop, then use interchange to underprice pure software competitors.