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Ask HN: How to create my own debit card?

3 points by pastaking ↗ HN
I mean how to create a card that acts as a debit card that I can distribute to other people? It's like those student cards university use for on campus food, shops, and internal services. Students would deposit money in, and spend money from the card at participating locations.

7 comments

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olefoo
You will need the following three advisors; a lawyer to tell you how to structure it, an insurance broker to help you manage your risk, and a tax accountant to make sure that you are keeping track of the money in a way that the IRS deems acceptable.

Depending on the state you are operating in, you may need to file for a money transmitter license. And yo and your advisors will need to go through http://www.fincen.gov/financial_institutions/msb/index.html and determine which, if any of the declarations you need to file and what compliance policies your organization needs to put in place.

You'll also need to ensure that you have enough working capital to cover potential withdrawals, and remember that you will have to keep the funds segregated from the rest of your organizations business.

Oh, and your insurance broker will have to figure out how best to insure you against all the normal risks that face a bank.

georgemcbay
There are companies set up to offer white label debit cards. Using one of them may be your best option but it depends quite a lot on exactly why you're doing this which your original post doesn't cover in nearly enough detail.
tait
Wow, totally orthogonal answers, both of which answer an interpretation of the question you were asking. Were you asking (a) how to set up your own debit card that works with the current system, or (b) how to MAKE your own card, from scratch?

(I'm a guessin "(a)").

eduardordm
This is how you do it: (I built exactly what you want)

- Build a bank

- Become a visa/mastercard issuer or create your own payment stack (which will have 0 merchants)

How to build a bank (checking, no savings):

- go to central bank website, you should be able to find the offices where you can apply for that license, call them and ask for law firms that already do that

- it costs a few hundred thousand of dollars - fees and lawyer expenses

Now the hard part: To become a bank (the type you want) you need a lot of money. 4 years ago it would take around 24mi to do that in the US. That money is usually retained by the central bank. After having that retained you need to retain at least 15% of all checking money in the central bank account, which makes it even harder to get started.

Summarizing: get 30 million, call CB, the lawyer.

Now, the Pro-Tip: A lot of banks can act like a proxy. You create your firm and reach an agreement with an existing bank to operate under it's license and structure. simple.com is just that :D

[dead] underdesign
You'll need _millions_ of dollars to form the bank corporation. You'll need to hire overpaid white-hairs to be on your board to make it look legit, and then you can start printing money.