Visa Reveals Strategies Credit Card Issuers Can Implement to Increase Customer Lifetime Value

Credit card issuers face competition on a number of fronts when they try to attract new customers. Not only must they contend with new cards on the market that offer attractive benefits and previously unheard of introductory 0% APR periods, but new types of payment providers also vie for consumers’ attention.

Buy now, pay later (BNPL) solutions are growing in popularity. The worldwide value of the BNPL market exceeded $37 billion in 2024, representing an increase of nearly $7 billion over 2023 figures, and it’s estimated to have a value of more than $167 billion by 2032.

And, of course, financial institutions continue to offer payment products like debit cards that allow consumers to enjoy the convenience of completing transactions without using cash or accessing credit. With so much competition in the payments market, it’s imperative that credit card issuers implement strategies that help them retain profitable customers. 

Customer lifetime value is a metric that businesses can use to assess how valuable a customer will be over the course of their entire relationship with a company. We caught up with Todd Pollak, Chief Revenue Officer at Marqeta, to hear his opinions on how credit card issuers can grow customer lifetime value.

“The most successful issuers recognize that maximizing customer lifetime value isn’t about extracting more from customers but rather increasing the value exchange — providing services that customers genuinely value while generating sustainable revenue streams,” Pollak told us.

Visa recently released a report, in collaboration with PYMNTS Intelligence, that details strategies issuers can follow to drive customer lifetime value through innovation. For the purposes of the report, Visa defines customer lifetime value as “the measure of the total revenue a cardholder generates over their lifelong relationship with an issuer.”

The Visa and PYMNTS Intelligence report draws from a survey of 451 payments executives in the U.S. and includes respondents from both bank and nonbank credit card issuers. The report aims to help card issuers “maximize revenue, enhance customer relationships and achieve a competitive edge.”

The report examines critical factors that drive high customer lifetime value, defined as a value of more than $2,500. These factors include:

Diversifying Revenue Streams: The Visa and PYMNTS Intelligence report reveals that high customer lifetime value issuers use an average of 7.5 strategies to monetize their platforms. 

These methods can include offering co-branded cards and embedded financial products. Value-added services, including subscriptions for fraud protection programs, can also boost revenue. 

Forging Strategic Partnerships: The report found that 62% of banks or credit unions with high customer lifetime values use co-branded partnerships. Credit card issuers can partner with airlines or prominent retailers to enhance their visibility. 

“This strategic approach allows card issuers to leverage the established reputation and loyal customer base of partner brands, creating a mutually beneficial relationship,” the report said.

We caught up with Mark Jackson, Managing Director, Product at Valuedynamx, to learn about other ways that partnerships can benefit credit card issuers and their customers. He told us that knowing a customer’s favorite brands or spending categories can help issuers anticipate which rewards offerings are most likely to drive card spending.

“This intel provides opportunities to surprise and delight cardholders with relevant offers and rewards for transactions, or behaviors, with spending categories and brands they love and use most often,” Jackson told us. 

“These sorts of personalized experiences will go a long way in nurturing long-term relationships and boosting customer lifetime value through frequent, meaningful interactions,” he said.

Visa and PYMNTS Intelligence survey participants said that providing customers with a personalized experience is of utmost importance when it comes to being a best-in-class issuer. Issuers can provide a personalized experience by:

Modernizing the Customer Experience: The report details that card issuers consider both advanced customization and data analytics to be key drivers of customer engagement. Advanced customization options include offering portals that empower customers to manage card settings and review their transaction history.

The Visa and PYMNTS Intelligence report reveals that data analytics can help issuers identify opportunities to cross-sell products. Data analytics can also allow for real-time tracking of cardholder activity that yields insights into customer behaviors and purchasing patterns. 

Data analytics programs can enable issuers to bring more value to cardholders.

Pollak told us that tailoring benefits to align with spending patterns can help an issuer motivate cardholders to use their cards more often. 

“Analyzing transaction data can help identify opportunities to offer relevant benefits that cardholders actually value,” Pollak said.

Following these strategies can help credit card issuers grow customer loyalty and lifetime value, but they aren’t foolproof. Pollak told us that customer loyalty is fragile. Even the most satisfied customers may be on the lookout for the next best product. But engaging with customers throughout their relationship with a company can aid customer retention.

“Implementing strategic touchpoints throughout the customer journey from acquisition to maturity is key,” Pollak said. “This may include targeted upgrade opportunities, anniversary benefits, and retention offers based on usage patterns and life stage.”