Scaling Requires Modular Card Issuing
Bo Jiang, co-founder and CEO of Lithic, on the key primitives in card issuing
This is the moment when card issuing stops being a launch shortcut and becomes core infrastructure. Early on, an all in one BaaS can get a debit card live fast with preset compliance and bank workflows. As a fintech grows, it wants to add products like charge or credit, swap in a different ledger or credit core, and tune exactly how users are screened and monitored. That is where modular issuers like Lithic start to matter most.
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Fine tuning AML and KYC means changing the actual onboarding rules, data sources, and review logic. A company may want lighter checks for low risk users, stricter checks for certain industries, or a separate vendor for identity and fraud. All in one stacks often hard code more of that flow, while modular stacks are built to plug into outside compliance tools.
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Launching a second product is usually where the pain becomes obvious. A team that started with debit may next want charge cards, credit, bespoke physical card controls, or a specialized payout flow. Lithic is positioned as the card processing layer that stays constant while the customer changes the ledger, underwriting, or compliance systems around it.
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The bank relationship also changes at scale. Smaller fintechs often want the platform to hide the sponsor bank and handle operations for speed. Larger programs want direct access because the bank wants visibility into who it is sponsoring, and the fintech wants more say over compliance, economics, and roadmap. That shift naturally favors point solutions over packaged BaaS.
The category is moving toward a split market. Smaller teams will keep buying packaged speed to market, while scaled fintechs and enterprise programs will keep unbundling into specialist layers for issuing, compliance, ledgering, and bank connectivity. That shift gives modular issuers room to expand from card processing into the broader money movement stack around their largest customers.