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Data breaches are nothing new, but their frequency seems to be increasing every year. From Target to Home Depot, to a waiter stealing your credit card number, it’s getting harder to protect bank accounts.
Final’s founding team members know this all too well. During a trip in January, three of Final’s employees were in Europe when their credit card was deactivated without warning. That very same day, another colleague in San Jose had his credit card deactivated as well. It was due to the Target breach.
Suddenly, their getaway to Europe was interrupted by phone calls to credit card companies, updating information with all their subscription services and figuring out how to get a new card across the pond. If you’ve ever had to get a new bankcard while travelling overseas, you’ll understand their frustration.
A Better Way
That pain point hit a nerve with the team. “The idea that credit cards having this static 16 digit card number felt very archaic and unnecessary,” said Final’s director of marketing Ben Apel. No one else was improving the issue for consumers, so they decided to tackle it.
It started with a simple idea: If a garage door uses a different number each time you hit that button, certainly it seems like our payment technology should be a little more dynamic as well,” said Apel.
Their card, yet to be released, issues a new unique number for each vendor. That means each place you shop will get its own unique number for your card. If one merchant, say your local baker, has a data breach, Final shuts down only that number, leaving your card and all your other purchases safe. For the consumer, it means not having to deal with deactivated cards, or worrying that a hacker in Russia is buying electronic toys on your dime.
For the buttoned-up financial industry, which is associated more with swindling Main Street than it’s consumer-friendly innovation, Final is trying to shake things up. They aim to make the system more transparent, give consumers better control over their cards, and make credit cards more secure in the process.
Tall Barriers
“There’s a reason startups don’t go after credit innovation, that’s because it's really really difficult. The amount of regulation, the amount of hurdles to jump over is not something designed for a small team or a small budget,” said Apel. Still, the company started in January and has made notable strides.
Dealing with the regulatory barriers has been one of the most challenging parts of the process.
In Your Wallet in 2015
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The team hasn’t issued its first credit card yet. They are still working to find the best bank to partner with for the services. Apel says it’s not just a matter of the terms of the deal, but finding a bank that understands their mission and matches their culture.
Still, Apel is confident they’ll launch a card in 2015.
“The difficult thing about financial technology… there is no such thing as a minimal viable product, because you can’t just build 30 percent of a product, push it out live and hope that people will use it if it has to do with money,” said Apel.
From Millennial to Baby Boomers
Final is targeting millennials as its first demographic for the launch, but says the product has wide appeal for different age groups.
Parents like it because of the control it gives them over their child’s spending; Apel calls it the world’s first family-friendly credit card. Parents can give their kids access to a card that is only good at certain pre-approved stores, and for a pre-approved amount. That means mom and dad won’t be surprised at the end of the month by a huge bill from iTunes.
For millennials (which is what the team identifies as), the control and transparency aspect resonate. “We want competitive services, we want them to be cheap, we want them to be easy to use and we want them to be transparent not only in their business dealings but how we interact them,” said Apel.
For the 40-60 year old range, the security features have been the most attractive feature. That group likes the idea that they can shut down a number with one merchant if there’s been a security breach, without having to deal with the mess of changing all their information and issuing a new card.
Apel points out that he has 16 subscription services that are charged on a monthly basis – things like cable and cell phone bills, Pandora subscriptions and online publications. I think we can all relate to that.
