For millions of Americans, low credit scores create a vicious cycle. A low credit score can close off valuable opportunities and increase the interest due on loans. And in turn, that makes it harder to get a better credit score.
This is where Sparrow comes in to help. The company offers its credit card to non-prime customers and teaches those customers how to improve their credit scores. As cardholders make consistent bill payments, Sparrow rewards them with increased credit limits.
The Challenge: Non-prime credit poses unique challenges for Sparrow
Sparrow knew from the start that it needed two things to resonate with non-prime customers: trust and reliability. Sparrow built trust with its educational materials and rewards for on-time payments, but reliability depended on choosing the right payment processor:
- Given that Sparrow’s customers needed to improve their credit, a single missed payment could jeopardize that. Sparrow needed a payment system that would function with uptime as close to 100% as possible.
- Since Sparrow’s customers paid their bills through a wide variety of payment methods— including both debit cards and pre-paid cards — it was critical to support the broadest range of payment methods possible.
- And to ensure that Sparrow could quickly resolve any issues that occurred, the company needed a payment processor that was extremely communicative and responsive.
While initial reception to the card program was positive, Sparrow faced an early hurdle. Their payment services experienced frequent outages, taking payment services offline up to 5% of the time. This was unacceptable, given that Sparrow customers urgently needed to make payments on time or else risk damaging their credit further.
The Path Forward: TabaPay helps Sparrow delight customers with reliability
Sparrow was first introduced to TabaPay through a third-party. Many companies connect to TabaPay through third-parties and enjoy high reliability. But in this instance, given Sparrow’s challenges with one of its providers, it made sense for Sparrow to connect directly to TabaPay to improve uptime. With TabaPay’s high reliability, Sparrow could offer its customers the freedom to pay when it is most convenient for them.
“We’re now seeing uptime at or above 99.999%, so our customers can pay their bills at any time and consistently build their credit,” says Lisa Sturm, Co-Founder of Sparrow.
TabaPay empowered Sparrow to support every payment rail their customers might call on — including Real-Time Payments, debit cards, and pre-paid cards. TabaPay supports a wide range of BINs (bank identification numbers) compared to other processors, which helped Sparrow become more accessible to more customers.
“We initially saw a lot of failures associated with payments from key government-benefit Social Security cards,” says Amelia Hesse, Senior Director of Product for Sparrow. “Once we integrated directly with TabaPay, payments from those cards have come through much more consistently — jumping from an 11% approval rate to a 94% approval rate.”
Behind-The-Scenes: Sparrow gains reliable access to expert knowledge with TabaPay
On top of TabaPay’s customer-facing benefits, Sparrow found that things ran better behind-the-scenes as well. If Sparrow had questions, it could cross-reference easy-to-read TabaPay documentation or reach out to knowledgeable TabaPay representatives at any time.
“We’ve worked with other types of technology providers where your point of contact doesn’t know anything about the technical side of things,” said Sturm, “but at TabaPay, our contacts have always given direct, helpful answers, so we trust the decisions they make.”
The Results: Sparrow builds extraordinary trust with customers
In the time since its founding, Sparrow’s thoughtful credit-building tools and reliable payment systems have strongly resonated with the American public:
- Uptime has increased to 99.999% or greater for bill repayment.
- Performance has improved greatly, as timeouts & API error responses have decreased by more than 90%.
- Thanks to TabaPay’s support for a range of cards, the acceptance rate for a critical group of government-issued Social Security cards has increased from 11% to 94%.
Since the card’s creation in late 2023 Sparrow has become one of the fastest-growing cards launched in the last decade. Sparrow’s credit-card app is one of the highest-rated apps of its kind on both the Google Play and Apple App Stores, and one of the best-reviewed cards on both Credit Karma and Experian. Sparrow also received Tearsheet’s Best Banking Card Product Award in 2024 (and found itself in good company — TabaPay received the Most Innovative Payments Award from Tearsheet in 2023!).
Conclusion: Sparrow has the flexibility to dream big
Sparrow’s successful partnership with TabaPay is just getting started. Thanks to TabaPay’s unified API and support for a wide array of use cases, Sparrow knows that it can confidently make exciting plans for its future. And TabaPay is excited to support Sparrow as it continues to give hardworking Americans a path to better credit.
Ready to transform your business with instant payments? Contact TabaPay today to learn more.
