Introducing Lithic’s Commercial Charge Card

We’re excited to announce that Lithic is expanding our support of credit programs with our first fullstack credit product – Lithic’s Commercial Charge Card.

Not every charge card program is made equal. At Lithic, we designed Charge Cards to be flexible by combining our best-in-breed Card, Accounts, and ACH platforms but leaving space for customers to mix-and-match. Depending on what you’re building, we can provide an out-of-the-box solution where Lithic brings the sponsor bank as the lender of record (LOR), or you can bring your own.

With Lithic Commercial Charge Card, you can:

• Create and manage the full end-to-end charge card flow via Lithic’s API. Simplify reconciliation by having card spend and repayments all in one place at Lithic.
• Set custom billing timelines, repayment periods, and credit limits for each of your customers. For example, you can have some businesses on a 30-day billing period with 5 day payment terms while other businesses are on a next-day billing period with 3 day payment terms.
• Auto-collect repayment via ACH on the due date. Lithic will adjust the amount collected to account for early one-time payments.
• Generate statements. Retrieve data such as amount due, remaining credit limit, etc. from Lithic’s new Statements API to generate statements for your business clients.

This launch enables customers to extend financing to their clients and add new lines of revenue.

Why Charge Cards?

There are several reasons our customers choose to launch charge cards and why the product makes sense as part of your offering as well.

1. Help customers grow: 70% of small businesses who applied for loans over the last year indicated they have difficulty securing capital and financing. Tech companies have an opportunity to help their customers by underwriting and extending credit based on data they already have (e.g., sales volume, inventory levels). This credit enables their customers to grow.
2. Generate higher interchange revenue: Charge cards often come with additional revenue through fees and higher credit interchange (see Lithic’s guide on Maximizing Interchange).
3. Enter the credit space with less risk and complexity: Unlike revolving credit cards, charge card balances must be paid off in full by the end of the payment period. Balances cannot carry over to the next billing period and cannot earn interest.

Existing customers have built a variety of charge card programs at Lithic including:

• Vertical-specific charge cards for industries such as construction, eCommerce, and ad purchasing
• Expense management or accounts payable software with a commercial charge card used for spend controls
• Purchasing platforms where the platform purchases supplies on behalf of customers and collects repayment later

Our customers have already seen success using Lithic for their charge cards. “Lithic’s API has enabled us to craft a distinct experience for eCommerce brands swiftly,” said Parker’s Co-founder Milan Ray. “We are consistently amazed by Lithic’s adaptability and tailored solutions. Their prompt problem-solving and consistent availability make them one of the most dependable partners we’ve ever collaborated with.”

From startup to enterprise scale, all with Lithic

At Lithic, our design philosophy focuses on building modular, interoperable components—like Lego pieces—that customers can assemble in novel and interesting ways according to their own needs.

Getting a charge card off the ground can involve integrating with separate providers for each step of the flow:

• A payments provider for collections
• An issuer-processor for cards
• A ledger to reconcile between providers and keep track of balances

In certain cases, additional lag of 2-5 business days is introduced as customers have to first collect the funds from end-users and then forward it to their issuer-processor to fund additional card spend.

“For customers that want to launch quickly, the build can feel like a big lift. However, most out-of-the-box solutions then reduce optionality down the road when customers want to swap in best-in-breed solutions and bring key components in house,” said Bo Jiang, CEO of Lithic. “That's why we built Lithic’s Commercial Charge Card, to provide our customers with an insanely fast product experience that preserves flexibility at scale.”

Get started with Lithic’s Commercial Charge Card

We've seen a boom in developer creativity and ingenuity using charge cards, supported by the same interchange revenue as for credit cards that make these models sustainable.

To learn more, visit our guides or read our documentation. These features are now fully available to all customers in Sandbox. If you’d like to integrate them into your product, contact us.