In times of rapidly developing technology and the complex nature of modern financial life, people are increasingly keen to have more independence over their money and their spending.
Allowing customers to choose and implement their own spending controls on their debit cards is one of the many ways businesses can give their customers the increased freedom and control they desire.
But what do spending controls mean in practice and is it easy for businesses to implement these processes?
What are spending controls?
Spending controls are a variety of personalized limits and locks that users of debit cards can impose on their own cards, allowing them to have more command over how they spend their money and how they use their card. When a cardholder tries to spend more money than they’ve allowed themselves with a spending control, the purchase will be declined.
There are a variety of controls that cardholders could use, such as limiting how much the card will allow them to spend in a particular time period, preventing them from using their cards at particular businesses or types of business, or locking their card completely for a temporary period of time.
For example, if a particular cardholder is trying to save money for a new car, but knows that they need to cut back on how much they spend on coffee, the cardholder could opt to put a spending control on all cafés. They could, for example, limit their monthly spending to $30 per month, or completely block the use of their card in any café for a particular period of time.
Often, spending controls on debit cards are possible through banking apps or browsers, which is the most convenient way for cardholders to quickly and easily set the personalized controls that they need. With the possibility to introduce and modify spending controls with the lifting of a finger, controls can be an easy way to take control of one’s spending.
Cardholders can also control and block access to their card if it is ever lost or stolen. Cardholders can lock individual cards from their application as soon as they notice their card has been misplaced. They can unlock the card in the event of finding the card, or keep it locked until they receive a new one.
Why are they important?
Spending controls give customers much more flexibility and command over their money and how they use their debit cards.
In a time where people are required to juggle a variety of bills, income, and different forms of payment, spending controls can allow customers to take charge of their finances in the way that works best for them. Whether cardholders want to save more money, want more personal security over their finances, or want to better understand their spending, the flexibility that comes with spending controls on debit cards allows greater financial responsibility and independence in complex financial times.
For example, spending controls can be useful for people who find budgeting hard, providing sufficient barriers to those who struggle with overspending or with keeping track of expenses.
Spending controls can also allow cardholders to better understand their finances and spending. By setting up spending limits and alerts, they can better understand where they normally spend their money or if they are coming close to going over certain budgets that they have assigned themselves.
For those who need to monitor and restrict the spending of dependents linked to their account, spending controls can provide a great way to oversee spending without outright sacrificing the independence of other cardholders. For example, if a minor under 18 has access to their parent’s bank account through their own card, the parent could impose limits of a certain amount of dollars a month, or block payments to certain merchants that could be unsafe.
And, of course, these controls can play an important part in blocking fraud. The possibility to immediately lock a particular debit card from a device as accessible as one’s phone means that theft of funds can be prevented as soon as a card is misplaced or stolen. Rapid and quick responses are the most effective in preventing fraud and the theft of large sums of money.
Spending controls with Hydrogen
With Hydrogen, you can allow customers who use your debit cards to set their own spending controls, allowing them full flexibility over the use of their card. The use of our no-codes mean that little coding or product development is required, leaving all the difficult and time-consuming work up to us.
Customers have access to features such as controls on spending, withdrawals, merchant types, restricted categories, and more. Immediate locking of cards is also possible.
And these features are provided at no extra cost to you, with all features and third-party costs bundled into one price.
If you are interested in launching your own debit card program with the possibility for spending controls, contact us today.