Change Financial Limited announced an exclusive 6-year direct issuing partnership agreement with Mastercard in Australia and New Zealand (Agreement). Under the Agreement, Change will be able to issue prepaid and debit cards from fourth quarter of 2022. This Agreement follows Change's recent launch of Vertexon, its PaaS offering for Australian and New Zealand clients.

Vertexon seamlessly integrates with a businesses' core systems enabling them to easily deliver physical and digital card solutions to their customers as well as offering other features such as transaction processing and integrated loyalty programmes. Change is currently being onboarded to the Mastercard network with Change able to onboard clients to its PaaS platform from Fourth Quarter fiscal year 2022. The Agreement will see Mastercard provide Change with a cash incentive of USD 1 million (AUD 1.4 million) upon launch of the first direct issuing program which is expected in first half of fiscal year 2023, along with other incentives throughout the term.

The increased collaboration with Mastercard will also provide opportunities to enhance Change's PaaS offering through data, technology and relationships. Change recently announced that it will provide direct issuing services in Australia and New Zealand. Regulatory approval for New Zealand has been granted and the approval process for an Australian Financial Services Licence is underway.

Oceania is a key growth market for Change that already generates 29% of Change's revenue and accounts for 33% of its client base. Change will focus on securing new fintech clients as well as migrating small to medium size banks and credit unions from legacy card platforms. The addition of direct issuing in Australia and New Zealand is expected to drive transactional and processing revenue which will contribute to Change's annual recurring revenue (ARR). Direct issuing enables Change to have a closer relationship with Mastercard and removes the requirement of an issuing bank partnership (as is required in the US).