Glossary
BIN sponsorship
BIN sponsorship is the arrangement where a licensed scheme member lets you issue cards on their Bank Identification Number, so you can run a card programme without being a principal member yourself.
BIN sponsorship is the arrangement in which a licensed member of a card scheme — Visa or Mastercard, typically — allows another company to issue cards under their Bank Identification Number. The sponsor holds the scheme membership, carries the settlement obligation and answers to the scheme; the sponsored programme manager builds and runs the product.
Why it matters
Becoming a principal member of a card scheme is a long, capital-intensive process involving licensing, scheme certification, settlement arrangements and a compliance function to match. BIN sponsorship is how most card programmes launch without it: you rent access to the rails rather than building your own relationship with them.
The trade is control for speed. Your sponsor's risk appetite constrains your customer base, their scheme relationship governs what programme structures you can run, and their settlement terms determine your working capital needs.
What to establish before signing
- Who is the sponsor and who is the processor? They are often different companies, and an outage or a commercial dispute at either one affects your cards.
- Whose BIN is it, and can you migrate? Moving to your own BIN later usually means reissuing every card. Ask what a migration has looked like for previous clients.
- What is the settlement and collateral arrangement? Pre-funding requirements and collateral held against your programme are real balance-sheet costs.
- Which markets does the sponsorship cover? Scheme licences are territorial. A sponsor covering the EEA may not cover the UK, and almost certainly does not cover the US.
- What are the scheme compliance obligations passed down to you? Programme rules, marketing approvals and reporting obligations flow through the sponsor onto you.
Related terms
A programme manager is the party operating the card product commercially. An issuer processor runs the authorisation and transaction processing. Principal membership is the alternative to sponsorship: joining the scheme directly, which is slower and more expensive but removes the intermediary.
Ask providers about this directly
Put the question to several providers at once in a structured RFP, and compare their answers side by side instead of one call at a time.
Related reading
- Seven reasons BaaS providers reject applicantsRejection from a banking-as-a-service provider is usually a risk decision made early and rarely explained. Here are the seven reasons it happens — and what to change before you apply again.
- Launching a business account inside a SaaS platformWhat a vertical SaaS platform needs to offer its customers a branded business account: the licence question, the stack, the onboarding reality and the sequence to procure in.
- How to choose a BaaS provider in EuropeA practical framework for selecting a banking-as-a-service provider in the EU and UK: licence models, safeguarding, scheme access, integration reality and the questions that actually separate vendors.