“Cyrpto” is a term applied to a broad range of products and services from digital currencies, to blockchains, to new forms of contracts and art called Non-Fungible Tokens, or NFTs.
Payments professionals know that they need to understand these products, but they are very technical, and it can be hard to study up while also doing one’s day job. Still, when clients, customers, and management start asking about what the company’s crypto plans are, we need to understand the question.
In this episode we talk with long time crypto-journalist Bailey Reutzel about how all of these things work and where they fit into the world of payments.
We talk about the history of bitcoin and whether or not it will ever become a true currency. We cover whether or not blockchains are as useful as they seem, and we look at what NFTs are and how they can be used.
We then cover where a payments company might begin exploring the crypto space. While many avenues are available, there may be a few that are better places to start.
You can find the podcast here, or wherever you get your podcasts. Make sure subscribe and leave us a review to help others find the information.
If this make you want to learn more, the IPA also hosted a Summer of Learning Session with K & L Gates about the legal ins and outs of NFTs. You can find a recording of that webinar here: (40) Summer of Learning: NFTs - A “flash in the pan”? Or a true “game-changer”? - YouTube
Its Fintwist product aims to help employers recruit and retain workers
The way companies pay workers has fallen out of step with their financial needs, and Comdata is looking to fix that with its Fintwist Payroll product.
In the latest episode of the IPA Payments Pod, we talk with Brian Radin, the president of Comdata’s prepaid business about how the company has adapted its payroll business to meet the changes brought on by long-term trends and the acute problems that some companies are facing in the wake of the COVID19 Pandemic.
Recognizing the companies are having a hard time recruiting and retaining, Comdata wanted to provide them with a product that would appeal to employees having a tough time managing their finances. By offering earned wage access and financial information in conjunction with a no fee account, they hope to make payroll a way for the companies to stand out in recruitment.
You can listen to the podcast on your favorite podcast app or at our site.
Make sure to subscribe and leave us a review.
To learn more about Fintwist, visit its Web site at Fintwist - Superior Workforce Payment Solutions (fintwistsolutions.com)
Summer may be winding down, but with the return of Congress, the regulatory season will soon be in full swing. With agency heads to be appointed and confirms, lawsuits making their way through the courts, and talk of reopening regulations like those created for the Durbin Amendment, things will get busy in Washington and beyond.
In this episode, the IPA’s CEO Brian Tate breaks down some of the currents that will drive all of this activity. We talk about the possible new agency heads for the Consumer Financial Protection Bureau and the Office of the Comptroller of the Currency, the PayPal v. CFPB lawsuit, and possible changes to transaction routing for online merchants.
Subscribe and listen to the podcast through your favorite app or on the IPA Web site here: Podcast - Innovative Payments Association (ipa.org). Make sure to leave us a review if you find the content helpful!
Hackers, regulators, and customers can all turn gathering data into a liability for financial services companies. The risks grow with the volume, variety, and velocity of data – all of which are increasing in our digitized society.
The big challenge with all this data is how can it help businesses solve problems? Adwait Joshi founded DataSeers to build tools to answer this question for banks and Fintechs.
In the latest episode of the IPA Payments Pod, we discuss the promise and peril of data and how the flows of data will affect the future of regulation and the industry itself in the years to come. You can listen here, or wherever you get your podcasts.
To learn more about DataSeers, you can visit their Web site at: An AI Solution for Banking and Payments - FinanSeer® (dataseers.ai).
ILex consulting sees opportunities for innovative and old school players in the new world by Teaching Banks and Fintechs to Work Together
In the brave new world financial services, there are opportunities for both innovative companies and traditional banks, but they need to understand one another if they want to thrive, says Joyce Mehlman, the founder of iLex Consulting Group.
In the latest episode of the IPA Payment Pod, we talk about why Fintechs need to understand the difference and relative value of Banking as a Service versus a direct issuer model of working with banks. We also discuss how traditional banks need to understand where Fintechs offer more in terms opportunities than competition.
In addition, she explained how the latest group of Fintechs and their founders are different in that they are more focused on building a business long-term than they are in building up a company that can be sold.
Listen to the new episode now.
Banks and Fintechs may need to re-evaluate their relationships depending on what advice the regulators decide to give them. Looking to keep up with the times, on July 13 the federal bank regulatory agencies (FDIC, Federal Reserve, and OCC) requested public comment on proposed guidance designed to help banking organizations manage risks associated with third-party relationships such as Fintechs.
In the latest episode of our podcast, we talk with Brian Tate, the IPA’s CEO, Grant Hannah, the government relations director, and Eli Rosenberg from Baird Holm, about what the changes might mean, how the industry can respond, and where this fits into the big picture of regulation.
You can find the proposed guidance here. You can find the episode here.
Good Financial Data Goes Beyond Bank Statements: Payroll data is an important part of a person’s financial picture.
When we think of consumer financial data, the first thing that comes to mind is usually banking data, but that is an incomplete picture.
This was borne out in a recent executive order, in which the Biden Administration encouraged the Consumer Financial Protection Bureau (CFPB) to issue rules allowing customers to download their banking data and take it with them.
Increasingly portability of banking data can help consumers, but a more robust picture can be painted by making sure consumers have easy access to their own payroll data as well, says Lindsay, Davis, the head of markets for Atomic Financial.
In the latest episode of the IPA Payments Pod, we discuss the importance of payroll data and how better access to it can improve the lives of consumers and make things easier for businesses and financial services companies. You can listen to the episode here.
You can find the fact sheet on the executive order here. The full text of the order can be found here. You can learn more about Atomic here.
Capitol Hill has been taking an active interest in the payments industry. Overdraft, buy now pay later products, and even a possible computer chip shortage have all drawn lawmakers’ attention.
On top of all that, the Durbin Amendment has resurfaced as a topic of conversation, and there are rumors that it may be extended to other types of payments.
We cover all of this and more in our latest podcast episode with the IPA’s CEO, Brian Tate, and our Government Relations Director, Grant Hannah.
To learn more about the forces shaping the payments industry, we encourage our listeners to join the IPA for its Summer of Learning Webinar series, where we talk with regulators, industry leaders, and analysts about what they see coming in the world of payments innovation. Learn more and register at www.ipa.org.
How a pandemic led to a new vertical for the company
The pandemic created problems for individuals, governments, and businesses, but as the old saying goes, every problem brings new opportunities.
For Blackhawk Network, that opportunity began when it channeled its payments expertise into helping distribute relief money for governments and nonprofits. It used both closed-loop and open-loop prepaid cards as a way to deliver aid. The plastic and virtual cards were used to replace checks so that people could get access to funds quickly and inexpensively.
As the pandemic begins to subside, Blackhawk plans to continue working to deliver funds to vulnerable populations. The company has created a new vertical that it calls Payments for Good to work with governments and nonprofits who need new ways to disburse money.
In this episode, we talk with Tyler Gentry, the director of Payments for Good, about the work that led to its creation and the company’s future plans.
What is your company’s role in the payments industry (program manager, issuer, processor, service provider, etc.)?
Lindsay Davis, Head of Markets, Atomic:
Atomic is a digital services provider. Our payroll integrations are the payments infrastructure to securely connect end consumers to financial data and automate setting up and updating direct deposits.
Atomic is the market leading provider of payroll APIs, trusted by 10 of the largest fintech firms, including digital-first neobanks, alternative lenders, and digital brokerages. We are also the destination for direct deposit acquisition and enable features such as early paycheck and fractional payments, for banks, credit unions, and financial services partners.
What kinds of payments do you support?
Direct deposits account for our largest volume of payments and we also support ACH credits. A few use cases we support include payments by state unemployment systems and non-standard direct deposits from payroll providers such as fractional disbursements and non-recurring payments.
For market sizing context, in 2020, direct deposit accounted for 12% of ACH volume, representing 8 billion payments for salaries, wages, benefits, and assistance from employers to individuals, according to NACHA.
Atomic is also working with partners to digitize physical payments and reduce payroll fraud. While 94% of workers receive their pay electronically by direct deposit, checks capture off-cycle payments, such as real-time payouts and wages for non-W2 workers. The Federal Reserve collected 940 million paper checks worth $2.14 trillion in Q3’20.
What kinds of special features do your products and services offer?
Atomic simplifies complicated payroll integrations with a single API that covers over 165 unique payroll connections. Including incumbent payroll providers, bespoke enterprise solutions, modern HR tech providers, gig-economy platforms and government systems, Atomic’s payroll APIs cover approximately 65% of the U.S. workforce with a combined reach of 95 million workers. Combining those elements gives us a stronger conversion benchmark to traditional players.
Put simply, Atomic’s payroll APIs connect consumers to their paycheck and financial data trapped in payroll systems.
This solves two problems for our customers and their end users. The first is accelerating payday for consumers through a streamlined portal to set up or change direct deposits. For neobanks and brick-and-mortar banks we work with, this improves direct deposit acquisition and creates a better user experience.
The second problem we solve is qualifying users for financial services – for instance, loans or credit – that are contingent on income and employment data (VOI & VOE). The data behind the paycheck, such as gross earnings, earnings net of taxes, employment type and status, among other insights, are all accessible to consumers digitally.
As the surface area for digital payments expands, so do the threats for fraud. Further, fraudsters are only getting more sophisticated. By reducing the circulation of paper checks and use of pictures and screen shots, we have been able to prevent payroll fraud for customers and blacklist scammers across Atomic’s customers. We have also obtained our SOC II certification and are in compliance with consumer data protection regulations including CCPA and GDPR to ensure consumers know their data is secure and they are always in control of who has permissioned access to their financial records.
What kinds of companies are you looking to partner with?
We are looking for partners that share our vision to build more on-ramps to financial services for consumers and ways to collaborate to achieve our shared goal of democratizing payments while mitigating fraud.
Payroll APIs is a nascent category we are actively bringing to market with our customers, partners, and peers in the industry. We have had positive momentum however, only made a dent in our mission. We welcome opportunities to increase industry acceptance, adoption, and bring new applications for payroll APIs to market with members of the IPA, regulators, payroll providers, fintech firms, and financial intuitions.
What do you think the future of payments holds in the next five years?
The future is bankless accounts enabled by APIs, akin to Henry Ford’s horseless carriage, and it’s here now. In 2020 branches were rendered irrelevant and despite adapting to the “innovate or die” philosophy of fintech, banks are debating the past and fast following fintech playbooks. It might take longer than five years, however, in time we’ll evolve entirely from the branch-based model to mobile-first, as it’s already happening now, something we shared further insights on in our Atomic Intelligence newsletter here.
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