#11 - Michael Spelfogel, President & Co-Founder at Cardless

Join us on this week's episode of the Slice of Finance podcast, hosted by Jared S. Taylor! Our Guest: Michael Spelfogel, President & Co-Founder at Cardless.

What you’ll get out of this episode:

Inception of Cardless: Michael Spelfogel explains the inspiration behind Cardless and its vision for a digital-forward credit card landscape.
Cardless for Businesses: Details on how Cardless enables brands like Alibaba to offer tailored credit solutions to small businesses.
Innovative Rewards Programs: Cardless’s approach to custom rewards and loyalty programs designed around specific brand and customer needs.
Future of Co-branded Credit Cards: Spelfogel’s insights into how Cardless is expanding co-branded card offerings beyond traditional bank partnerships.
Memorable Startup Moments: Spelfogel shares a story of determination that helped Cardless secure its first client, Manchester United.

The Cardless Vision: Digital-Forward Credit Cards for Brands and Consumers

Michael Spelfogel, co-founder of Cardless, joins the Slice of Finance Podcast to discuss the inspiration behind Cardless, a fintech company with a vision to simplify and modernize co-branded credit cards. Cardless launched in 2018 with the aim of giving brands, particularly those in travel, retail, and now small business, an efficient way to offer credit cards to their customers without relying on traditional banks.

Despite its name, Cardless does issue physical cards but is preparing for a future where digital payments, mobile wallets, and QR codes redefine how people interact with credit. As Michael shared, “The name Cardless is an homage to the future,” highlighting the company’s commitment to innovation in financial services.

A Platform for Businesses and Consumer Loyalty

Cardless works with high-profile brands such as Qatar Airways, Simon Property Group, and Alibaba to create bespoke credit card programs. These cards go beyond standard offers to provide brands with flexibility in defining how rewards are distributed. According to Spelfogel, Cardless’ approach diverges from the “legacy mindset” of banks, allowing for creative rewards structures such as category bonuses, elite status upgrades, and targeted rewards based on spending milestones.

In the case of Alibaba, Cardless crafted a co-branded card specifically for small businesses (SMBs) in the U.S. that buy from Alibaba. This card offers 60-day payment terms to help businesses manage cash flow and reinvest in their operations before payments are due, which is critical for SMBs that rely on inventory sales to cover purchasing costs.

Expanding the Reach of Co-branded Credit Cards

Spelfogel also elaborates on the specific criteria Cardless uses when choosing partners, namely brands that have strong loyalty programs and high customer engagement. Frequent interaction with customers—think of airlines or marketplaces like Alibaba—helps foster loyalty and makes the credit card more valuable to the user.

While many consumers associate co-branded credit cards with airlines, Cardless sees a broader opportunity to expand credit offerings to brands in various industries, aiming to offer customers rewards programs that fit naturally into their lifestyles. “We believe people and businesses are looking for rewards that are much more bespoke and catered to who they are,” Michael notes.

Navigating Regulatory Changes

Co-branded credit cards, particularly those in the airline industry, could face regulatory challenges from proposals that may cap interchange fees on credit cards. While greater transparency in loyalty programs is seen as beneficial, Spelfogel expresses concern over potential changes to interchange caps, which he believes would reduce rewards availability, as happened with debit cards following previous regulatory interventions.

A Memorable Milestone

Spelfogel also shares an anecdote from the early days of Cardless: securing Manchester United as its first client. The story involved a last-minute flight to London and a bicycle ride through Oregon’s rural areas to meet with the legendary soccer club—an adventure that speaks to the persistence and adaptability at the heart of Cardless’ journey.

What’s Next for Cardless?

With the recent launch of the Alibaba co-branded card for small businesses, Cardless is focusing on expanding its SMB solutions. As Spelfogel envisions, “In the future, brands will build credit cards that customers will want, and consumers are not going to have cards from traditional banks, but from brands they know, trust, and love.” Cardless aims to lead this transition, supporting brands with the tools to build customized financial products that offer meaningful value to customers.

Cardless represents a forward-thinking approach to credit, where the card in your wallet aligns with the brands you trust. Spelfogel’s insights reveal a fintech company set on reshaping the future of co-branded credit cards, making them more accessible, flexible, and tailored to individual consumer and business needs.