And it’s shaping up to be a September to remember for tokenized deposits.

Tokenized deposits exist as digital holdings — not to be confused with stablecoins, a form of cryptocurrency — that are in fact fiat currency (not merely backed by fiat). 

In a spate of recent announcements, a far-flung roster of players — monetary authorities, banking consortiums and, of course, banks — have announced pilots and other programs that are aimed at testing the real world application of those deposits that settle in central bank money.

Citigroup said in a report early this month that 65% of corporate respondents surveyed by the bank plan to use options other than central bank digital currencies (CBDC), including tokenized deposits, to support digital securities settlements by 2026.

And as PYMNTS reported over the summer, “Deposit tokens can also be integrated into banking infrastructure, allowing for smooth interoperability with traditional banking services. This integration ensures that users can see the benefits of blockchain technology without abandoning the familiar framework of their existing financial systems.”

Pilots and Cross-Border Finance

Late last week, the Hong Kong Monetary Authority (HKMA) announced that its second phase of testing had begun for its e-HKD Pilot, where “new forms of digital money,” including tokenized deposits, as 11 groups of firms across a variety of sectors are exploring tokenized assets, programmability and offline payments.  With the launch of the second phase, the efforts of the HKMA are being renamed “Project e-HKD+.” Key lessons are to be shared with the public by the end of next year, the HKMA said.

In a document detailing the pilot program’s phase 2, the HKMA said that Hang Seng Bank, Aptos Lab and Boston Consulting Group (BCG) will test the commercial value of settling a tokenized fund using digital money on a public blockchain; among the other tests, Mastercard, Kasikornbank (Kan) and Airstar Bank will explore the use of digital money “to facilitate both domestic and international trade finance.”

In another September announcement, the Institute of International Finance detailed 41 firms involved with joint public and private tests of Project Agora, in turn working with the Bank of International Settlements (BIS) to explore the tokenization of cross-border payments.  

In a statement, BIS noted, “Challenges for cross-border payments include different legal, regulatory and technical requirements as well as various operating hours and time zones. Also among the challenges is the increased complexity of carrying out financial integrity controls (e.g. customer verification and anti-money laundering). These controls are often repeated several times for the same transaction, depending on the number of intermediaries involved.”

The majority of the 41 name participants from the private sector are banks; the payment networks Visa and Mastercard also are participating, as is Swift.

Also in September, UKFinance reported that the latest phase of experimentation tied to the Regulated Liability Network (RLN), testing of “foundational capabilities” included the settlement of tokenized deposits via simple push payments and interbank settlement of tokenized deposits.

“The tokenization of deposits can be implemented so as to be neutral from a legal and regulatory perspective, as compared with traditional deposits,” wrote UKFinance.

The post September to Remember for Tokenized Deposits? appeared first on PYMNTS.com.

Digital wallets are table stakes for most consumer across five major markets (Brazil, France, Germany, Brazil, the U.K. and the U.S.). In fact, 86% of consumers say they are familiar them. However, some are using them without quite knowing what they are. For example, just 6.5% of Generation Z consumers, for instance, correctly distinguished these wallets from other related apps.

Consumers may not have the correct terminology or know-how to identify digital wallets. When presented with a list of apps, however, they can identify at least one wallet they have used. There is a disconnect between how consumers are using these wallets and their understanding of them. Providers looking to differentiate themselves need to understand how consumers understand these apps to best position their product.

These are just some of the findings detailed in “Digital Wallets Beyond Transactions: How Do Consumers Think About Digital Wallets?,” a PYMNTS Intelligence and Google Wallet collaboration. This report examines consumer perceptions and use of these wallets in the last year across five markets. It considers this technology’s future growth potential. It draws on insights from a survey of 12,229 consumers across five markets conducted from Jan. 11 to Feb. 5.

Inside “Digital Wallets Beyond Transactions”:

• Consumers’ familiarity and understanding of these wallets across five different countries
• The share of consumers who are using them
• Which generations are using and correctly identifying these wallets
• How consumers are confused about the terminology and identification of the wallets
• The popularity of the key players

Among all the countries, consumers in the U.S. and U.K. were the most likely to correctly identify a digital wallet. These countries also have some of the highest rates use. This suggests that education could be key for driving adoption of this technology. Download the report to learn more about global trends in this exciting space.

This report is part of a series exploring how consumers in various major economies are using digital wallets. Check out the archive to learn about how consumers’ awareness and use differ by country.

The post Digital Wallet Providers Face Uphill Battle Defining the Technology appeared first on PYMNTS.com.

The rate of digital acceleration has differed across regions and countries based on technology — in short, whether laptops and mobile devices are readily available. By way of example, contactless payments have been an option for several years in Europe, with widespread adoption. But it was necessary to have the 2014 launch of digital wallets in place to enable that acceleration globally. In other countries, like India, tokenization is pretty much ubiquitous.

As part of the latest “What’s Next in Payments” installment focused on digital engagement, Fincioen said Mastercard is finding it’s an opportune time to launch its Mastercard Payment Passkey service into India as the market is already almost 100% tokenized. In time, Passkeys can also benefit emerging markets by bringing security and frictionless payments together.

Mastercard has been working with client firms, including FinTechs, to get end users more fully engaged in various digital use cases — and data offered by the payments network can help those enterprises gauge how well, and where, their customer engagement has been trending as they introduce new products and services. Mastercard, she added, has visibility into 143 billion transactions annually.

That visibility is being combined with Mastercard’s analytical capabilities, machine learning and a host of different artificial intelligence (AI) methodologies to optimize the performance of its customers. The data is also useful in helping merchants to improve approval rate and checkouts.

“We use data to show them how they are performing versus their peers, the best in class, similar customers in different demographics, different countries around the world … and how they can improve their performance when it comes to payments,” Fincioen said. “Digital solutions offer up the answers to improving performance.”

Mobile Devices Bring Speed to Payments

Across those geographies, said Fincioen, the movement is to use mobile phones and mobile applications for payments. Younger consumers, especially, value speed when it comes to payments. But even older demographics, she said, are feeling more comfortable using digital wallets and solutions for payments.

No matter the payment method or the technology being deployed, security is critical, and Fincioen noted that fraudsters are getting more sophisticated and their schemes are rapidly evolving.

After all, she said, “trust is at the center” of all commerce and at the center of any transaction, especially in the digital age.

Along the way, with trust, streamlined operations and better security in the mix, enterprises using Mastercard’s offerings can boost approval rates or extend a range of payment options to customers.  The collaborative nature of the relationship between Mastercard, FinTechs and end users helps to onboard new digital solutions via Mastercard’s large network of FinTech partners.

In terms of the different roles within the organization that must keep their attention front and center on digital engagement, Fincioen said, “Everybody’s responsible … ranging from the product teams that are enabling digital ways to pay, to the teams teams integrating security protocols and solutions like biometrics.” Services and optimization teams also guide customers to leverage the right digital tools. Merchants, she said, are especially interested in deploying tokens and card-on-file solutions to guarantee the best checkout experience while generating sales to those merchants.

As she told PYMNTS, “The whole world is going through digital transformation, and payments — that enable the commercial interactions behind what’s going on in the world — need to go through that digital transformation as well.”

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For Serena Smith, chief client officer of i2c, it means digital-first customer engagement.

Individuals and companies around the globe demand digitally issued cards and payments choice, and in turn, companies must pivot to serve them across a variety of use cases and markets, she told PYMNTS for the “What’s Next in Payments: How Do You Do Digital?” series.

For her company, which enables client firms to issue credit, debit, prepaid and core banking solutions, a digital-first approach is pervasive. In recent years, artificial intelligence from a customer engagement standpoint has been a boon.

AI has helped enable the platform to look across the entire financial services ecosystem and gain insight into how people use their cards, how they use digital wallets, and how client firms can anticipate what their end customers want across 216 countries and territories — and when, she said.

The shift toward digital channels is palpable, said Smith, who added that even older consumers (her own father included) have been using their devices and platforms to help conduct their daily financial lives. Millennials and Generation Zers are digitally native.

Using digital tools for instant wage and earnings access is proving especially popular, she said, especially with i2c’s clients in North America and Canada.

“Because we’re in so many different countries and territories around the world, not only can we look at a certain segment, but we get to look across the whole broad ecosystem, and we can see what’s happening from different geographies and different perspectives of how they’re using the cards,” Smith said.

Asked by PYMNTS about where there are pockets of growth and low-hanging fruit — geographically speaking and over the near term — Smith said that her firm is seeing activity in Latin America and countries including Peru, where digital banks are gaining ground. The Middle East is also fertile ground.

“That’s not to say that we don’t continue to see activity gaining in places like North America and Canada because those are going to be key centers for us,” Smith said.

Along the way, and with a nod to the mechanics of the platform itself, i2c provides building blocks to its clients, offering them different ways to help them meet market-by-market needs via APIs, she said.

“As we’re working with our customers to do that transition from analog to digital, we can take that in pieces and parts as we help them to do that,” said Smith. “When you think about real-time disbursements, you think about all your mobile-first banking, you think about all the digital processes, and you think about the scalability and the reliability of the platform. All of that’s available as they go through this transition.”

Underpinning it all is data, which Smith said is the gold mine “that our customers sit on top of — and that they may not even realize that they have.”

The platform approach helps them harness that data and use predictive analytics to understand where their end users are headed and how their needs can be met with contextualized offers and products.

Most individuals have relationships in various places. They may do business with multiple banks or have a mortgage in one place, a checking account in another place, and a car loan in yet another place.

“Understanding your customers can help you to pull that customer into your financial institution so you can better service them,” Smith said. “Data helps lead you to better customer engagements as well as cross-sell and upsell to your customers understanding what their behaviors and their needs and wants are.”

The post One Size Fits All Misses the Digital Payments Mark appeared first on PYMNTS.com.

A PYMNTS Intelligence report “Tapping Into the Future of Payments” explored how the rise of digital payments, especially among younger generations, is transforming the traditional banking landscape, presenting both opportunities and challenges for financial institutions and payment providers.

Digital Wallets: The New Norm for Millennials and Gen Z

Cash is losing its dominance as digital wallets become integral to younger consumers’ financial lives. With 85% of Generation Z and 82% of millennials preferring contactless digital payments, the demand for these technologies is reshaping the payments industry. Traditional cash transactions are being replaced, with 24% of U.S. adults now favoring digital alternatives. The shift is not a fleeting trend but a transformation, driven by the convenience of digital payments.

According to the report, 91% of Gen Z consumers are adopting digital-first payments, outpacing other age groups. Millennials and Generation X consumers are also transitioning toward digital wallets. This broad acceptance indicates that businesses must adapt to these evolving preferences to remain relevant in a digital-centric market.

Banks and FinTechs: Redefining Traditional Banking Models

The surge in digital payments is challenging traditional banks to reassess their roles. The competitive pressure from FinTechs and non-traditional financial services is pushing banks to innovate or risk becoming obsolete. Ninety-four percent of banks are planning investments in modern payment technologies to stay competitive.

According to the report, 52% of European consumers aged 25 to 34 are turning to financial services offered by retail brands instead of traditional banks. This trend highlights a shift toward digital and brand-centric financial solutions, prompting banks to rethink their strategies.

In response, banks are adopting new technologies and forming partnerships with FinTechs. For example, pay-by-bank tools and integrated payment systems are gaining traction, illustrating the financial sector’s commitment to adapting to technological advancements.

The Next Frontier: Pay by Bank and Advanced Payment Technologies

Advanced technologies like pay by bank are redefining payment methods. This approach enables direct transfers between bank accounts, bypassing traditional card networks. It not only reduces transaction costs but enhances security by minimizing the sharing of sensitive payment information.

Despite its benefits, pay-by-bank technology is still emerging, with 36% of consumers using it due to low awareness. About 33% of Gen Z and 24% of millennial consumers are unaware of their banks’ pay-by-bank options. Financial institutions need to boost consumer awareness and education about these solutions.

Innovative solutions such as HSBC’s Zing app and the Chase–Mastercard partnership exemplify the industry’s efforts to embrace new technologies, the report said. HSBC’s Zing app challenges traditional banking norms, while the Chase-Mastercard collaboration aims to enhance eCommerce by cutting payment processing costs.

To thrive in the shifting payments landscape, financial institutions must proactively embrace digital literacy, prioritize consumer-focused innovation and use artificial intelligence for tailored payment solutions. Establishing a strong digital payment framework and forming strategic partnerships with FinTechs and retailers are crucial. Adaptability and innovation will be vital as digital payments redefine commerce.

The post 85% Of Gen Z Prefers Digital Payments to Cash appeared first on PYMNTS.com.

They were in development as early as 2008, but what began as a public health measure in mid-2020 has evolved into a transformative force in the payments industry, impacting cards, digital wallets and other tap-to-pay technologies.

As consumers and businesses alike embrace the new post-pandemic life of contactless payments, PYMNTS gathered two executives from the payments industry to explore its new frontier: Visa Senior Vice President and Head of U.S. Merchant Chris Baker and Bank of America Managing Director: Vendor, Third Party and Network Management, Sara Walsh.

“The pandemic certainly increased the use of contactless,” Walsh told PYMNTS. “I think it’s important to remember, though, back to October of 2014, when Apple Pay debuted. That really started contactless adoption. While some issuers had also already enabled contactless plastics, the usage was pretty low.”

One game-changer came with the adoption of contactless payments in public transit systems. Baker pointed out that cities have been driving early adoption, with more than 30 cities in the U.S. having contactless penetration over 60%. This trend is exemplified by New York City’s MTA system, where awareness created through contactless usage by millions of daily riders is contributing to 75% of face-to-face transactions being tapped in New York City. As both executives noted, as consumers become more comfortable with the technology in their daily commute, they’re more likely to use it in other contexts.

As contactless payments have grown, so too has the sophistication of fraud prevention measures. At the forefront of this evolution is tokenization, which not only enhances security but also offers additional benefits such as increased conversion rates for merchants and issuers and the ability for merchants to keep a card number on file.

Baker added that the underlying EMV chip technology, developed originally to combat card-present fraud, combined with NFC for contactless transactions, creates a formidable weapon to fight fraud. The technology also significantly reduces the risk of card skimming. As Walsh pointed out, “There’s no actual contact between the card and the terminal,” eliminating the opportunity for fraudsters to install skimming devices.

The Future: Biometrics and Beyond

As contactless payments continue to evolve, both Walsh and Baker see exciting developments on the horizon. Walsh predicted a convergence between card-based and mobile wallet-based contactless transactions, which are currently heavily skewed toward card usage.

Perhaps the most intriguing development is the integration of biometrics into contactless payment systems. “I love being able to go into Whole Foods for example, and pay for my groceries with my palm,” Walsh said. “I think that that’s low adoption right now, but it’s certainly something that will take off and people will see it, they’ll get how cool it is and want to participate.”

Baker sees the future of contactless payments as “tap to everything,” envisioning a world where NFC technology is applied to a wide range of use cases beyond traditional payments.

As the U.S. market catches up to global leaders in contactless adoption, there’s still significant room for growth. The recent milestone of 50% penetration in the U.S., reached in June, marks just the beginning of what both experts see as an exciting journey toward ubiquitous contactless usage.

“I think in terms of some of the innovations, and where things go from here, this idea that we have this great NFC-enabled, safe, trustworthy, quick-to-use technology that we can now apply to all sorts of different use cases — tap to everything, if you will — that’s where we at Visa are really excited to take things,” he said. “We’re already seeing some things in the market. Others are in development, and there’s lots of other great ideas down the line.”

The post Visa and BofA See Contactless Payments Hit Their Post-Pandemic Stride appeared first on PYMNTS.com.

Consumers in Brazil are embracing their digital wallets for making payments. Almost half of consumers use them for paying bills, for example. Surprisingly, it is the country’s baby boomers and seniors who are the most active digital wallet users when paying bills — and for online shopping. In fact, 31% of baby boomers in Brazil paid for an online purchase using one of these wallet. In contrast just 20% of Generation Z and 25% of millennial consumers in Brazil did the same.

Consumers in Brazil are also exploring how these wallets can be a trusted for non-transactional purposes. In fact, they are doing so at a much higher rate than their peers in other countries. For example, 34% of consumers in Brazil expect to verify their identity using a digital wallet in the next three years. This suggests that the Brazil market is ready to use these wallets to hold IDs and other documents.

These are just some of the findings detailed in “Digital Wallets Beyond Financial Transactions: Brazil Edition,” a PYMNTS Intelligence and Google Wallet collaboration. This report examines consumer perceptions and use of digital wallets in the last year and into the future in the Brazil market. It draws on insights from a survey of 2,101 consumers in Brazil conducted from Jan. 11 to Feb. 5.

Inside “Digital Wallets Beyond Financial Transactions: Brazil Edition”:

• What tasks consumers in Brazil are completing using these wallets
• Which generations are using these wallets the most
• How consumers in Brazil are using these tools for identity verification
• Use cases for events and ID needs
• What share of consumers in Brazil predicts using these wallets for accessing events will become the norm

Once consumers have used a digital wallet to store credentials or show their IDs, most are satisfied with their experience. Download the report to learn more about what’s next for these wallets in Brazil.

This report is part of a series exploring how consumers in various major economies are using digital wallets. Check out the archive to learn about how usage in Brazil compares to other countries.

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“At the end of the day,” Sara Craven, general manager of Visa’s solutions Authorize.net  and Verifi told PYMNTS CEO Karen Webster in the latest PYMNTS SMBTV installment. “The consumer experience has to be flawless. There is no room for error.” 

Even charities aren’t exempt. They are, after all, big businesses on their own, with the Bureau of Labor Statistics’ most recent data putting nonprofits at 10.2% of all employment in the U.S. And just like the for-profit businesses that they transact with, consumers don’t usually care where the payment is being processed, as long as things are secure and predictable — and everyone can see, right alongside the digital receipt of their transaction, including who they’ve purchased from, when and exactly what they are getting.

As Craven noted in a conversation on where tech is taking us on PYMNTS SMB TV program, payments, in general, need to be simple. The rise of mobile wallets suggests that data pop up instantly, and a consumer can initiate a charge, all with a few clicks. Get it wrong, and consumers can vote with their feet.

That’s especially true, said Ronald Pruitt, the president and founder of 4aGoodCause, when it comes to charitable giving. As an online donation platform, 4aGoodCause helps nonprofits by providing the software that enables monthly giving via the subscription model. Donors can automatically give each month to the charity of their choice.

But, “Subscriptions are always a risk,” he told Webster. A donor can choose to cancel their subscription at any time. Sometimes a payment interruption comes when a card expires.

The continuum of enrollment and keeping donors enrolled (and donating) is critical, as most of the charities that work with 4aGoodCause are small nonprofits and are led by their founders or have fewer than 10 employees. They don’t have the resources to handle the complexities of payments, so they’ve partnered with Pruitt’s platform, gaining enterprise-level tools to help keep their nonprofits thriving.  

Embedded Finance for Donors

4aGoodCause, for its part, has worked with Authorize.net to outsource the routing of transaction data and embed flexible payment options for nonprofits to allow donors to pay with their preferred method. 4aGoodCause leverages Authorize.net’s Advanced Fraud Detection Suite to help identify and prevent potentially fraudulent transactions. 

The information collected and recorded by 4aGoodCause includes donor-level data, spanning the payment and card-level insight, that increases the lifetime value of the nonprofit relationship underpinned by the platform. The donor gets a financial record that lets them help manage their recurring subscriptions.

“We have a full subscription dashboard for the nonprofits,” Pruitt said, “where they can see the lifetime value of the donor.”

Keeping Donor Momentum

Mobile wallets, Pruitt said, have reached an inflection point, where more of 4aGoodCause’s eCommerce came from those payment options than via consumers inputting their details manually.

“I’m telling our nonprofits,” he said, “that they’ve got to look at their donation forms and make sure they are taking mobile wallets.” He noted that the joint efforts with Authorize.net’s eCheck, and Account Updater allow the transaction and checkout processes to be more forgiving, help boost conversion rates across the platform, and help to lift nonprofits’ donation volumes. The account updater settings also alert the nonprofit to reach out — before transactions fail.

“The donor [may not have intended] that payment problem,” he said, “so it’s your job to hold their hand and pull them back on track. That keeps the giving going.”

With embedded payments and better security in the mix, said Pruitt and Craven, there’s the opportunity to, as they put it, know your customer — to cater to their payment preferences, to know that they are who they say they are, and to keep the recurring subscription model robust. There’s also the opportunity to “nudge” subscribers to participate in one-time fundraising events or consider an extra one-time gift.

Looking ahead into 2025, Craven noted that AI will be a mainstay as new functionalities and features will lead to what she termed “more intuitive payments,” including voice-activated donations.

“Data and analytics are going to become even more of a key focus … [for the payments industry],” she said.

The post Tech for Good: Boosting Nonprofit Success With Digital Payments and Subscription Models appeared first on PYMNTS.com.

The Deposits integration into the Ingo Payments platform will create a modern, bank-grade, money movement platform that connects “money in and money out” functionality with an embedded, proprietary “money stack.” Ingo Payments now gives bank and non-bank issuers new plug-and-play capabilities to fund and monetize existing account relationships or to establish new virtual ones — by turning payments into new feature-rich accounts.

“This was literally a missing piece in our [platform] that powers the money in and money out [of an account],” Ingo Payments CEO Drew Edwards told PYMNTS CEO Karen Webster in an exclusive interview. “I’ve talked many times about how an account, a bank or a wallet is a place to store money, but in today’s world it must be easily created and funded digitally. It’s also a place to spend money from, and there’s risk associated with it. You have to be really good at risk management. With this combination, we get the part in the middle. That’s what Deposits has built: a modern money stack for ledgering and issuing accounts, now in the middle of the Ingo Payments money mobility platform.”

The “money stack” is relevant for banks as well as corporates that see an opportunity to turn a payment into an account that becomes the basis for a relationship with that customer. The Deposits software simplifies that for issuers because of its low-code or no-code platform, cloud ledgering, APIs and single sign-on systems — all of which simplify how banks and corporates track transactions in and out of those accounts.

“We can deliver all of those capabilities in a complete set of APIs and tools that make it easy to deploy new feature-rich accounts. And that’s what we mean by money stack,” Deposits CEO Joseph Akintolayo said. “We mean all the layers that you need to get to market in an efficient and meaningful way backed by our history, risk management, our know-how capabilities and our compliance. We see this as an awesome path toward the future.”

Edwards said the acquisition will amplify the capabilities Ingo Payments already provides to a diverse set of industries, including banking, FinTech, lending, hospitality, insurance, gaming and trucking.

From Great Idea to Go Live

Edwards used the example of a restaurant to describe the new Ingo Payments platform capabilities.

More than 90% of restaurants still pay out cash tips at the end of a worker’s shift. Consider a restaurant that would like to eliminate the friction associated with cash payouts and pay directly and instantly into a worker’s bank account. Edwards said that with the Deposits acquisition, Ingo Payments will expand the available options to include new instant-issue accounts for workers that open up new revenue streams and opportunities to make it more cost effective for the restaurant and the worker.

He pointed out that Ingo already powers some of the top restaurant operating systems in market today — the cloud ledgering that will now be integrated with inbound and outbound payments, as well as new accounts and complex money flows within this multilayer ecosystem, can be tracked seamlessly.    

In this use case, digital tipping becomes the baseline for a new branded account that simplifies payouts for the restaurant operator, enabling a true cashless experience that is also portable as the worker changes jobs. Edwards emphasized that it also turns what was formerly cash in an envelope into a new relationship with that worker and an ecosystem among the restaurants that becomes the basis for monetizing payments in new ways.

Future-Proofing Money Movement and Money Stacks

The Ingo Payments/Deposits integration creates a proprietary and modern money stack that brings together core and non-core capabilities — such as digital experiences for embedded account creation, ledgering, funding accounts, accessing accounts, risk management and compliance — as part of a money stack that exists inside of the Ingo Payments money mobility platform.

The platform is “processor-agnostic, core-agnostic and open-banking-agnostic,” helping banks and corporates leverage the power of creating new feature-rich, account-based relationships that meet modern consumer expectations. These include receiving money from relevant form factors, including checks, and sending money to relevant destinations including P2P, Me2Me and bill payments.

Edwards and Akintolayo use the term “proprietary” to mean, “ownership,” and with that the reduction in the number of third- and fourth-party integrations and partners that banks and corporates have to manage from a risk perspective. 

“You can’t outsource the core responsibilities of banking,” Edwards said. “Banks are ultimately accountable for compliance, whether they use third parties or not,” adding that the Ingo Payments platform with Deposits minimizes reliance on external partners, reducing the complexity and risks associated with compliance, and allowing banks to maintain tighter control over their operations.

Reducing the number of “layers and players,” and especially those that Edwards and Akintolayo consider core, makes the money movement and the money storage components easier for regulators, easier for banks, easier for even FinTechs to manage and to do it right, he emphasized, something that Ingo has been doing successfully for more than 20 years.

The Modern ‘Core’

Edwards also noted the potential for Ingo to now solve a big problem for banks, which is modernizing legacy infrastructure.

“It’s our point of view that the bank is at the center of the banking side of this,” he told Webster. “One of the things that we see changing is more and more financial institutions adopting a platform like ours for their own use, for their own direct customers, not just their FinTech partnerships. Everything from account creation to managing incoming and outgoing funds can be upgraded.”

Ingo Payments’ new Deposits capabilities reduce the barriers to entry for banks and corporates handling the heavy lifting of compliance, regulatory requirements and technical aspects. The platform offers ready-to-use, customizable components that require minimal to no coding skills, tailored for financial technology applications such as receiving payments, storing money and managing disbursements.

Banks and corporates can quickly launch financial services that are specific to their needs without forcing a one-size-fits-all solution. It focuses on compliance and customization, Akintolayo said, allowing businesses to translate their brand and values into the digital financial world.

“This changes everything for the ‘legacy’ economy,” Akintolayo explained.  “And it will give them the ability to catch up to the modern financial experience revolution. It’s what consumers expect today, and it’s what small businesses expect today in a digital, embedded world.”

The post Ingo Payments Acquires Deposits Inc. to Redefine Money Mobility for Banks and Corporates appeared first on PYMNTS.com.

Outdated payment systems can create cash flow challenges, while digital payments offer streamlined processing, enhanced operational efficiency and improved customer experience.

The PYMNTS Intelligence report “Getting Paid: Digital Payments for Improving Cash Flow and Customer Experience” examined how digital payments are reshaping accounts receivable (AR), offering insights into reducing days sales outstanding (DSO) and building stronger business relationships.

Outdated Payment Methods Hinder AR Efficiency

Despite the growing adoption of digital solutions, many businesses still rely on outdated payment methods, such as paper checks. This dependence continues to create issues for AR management. According to the report, 75% of organizations still use paper checks, despite their high costs and inefficiencies. The manual processing involved with checks results in slower transactions, increased potential for errors and longer DSO, adversely impacting a company’s cash flow and financial stability.

The drawbacks of paper checks are evident in industries like construction, where 76% of subcontractors receive payments through checks. This method led to a staggering $273 billion in losses due to slow payments in 2023. Additionally, costs associated with issuing checks — ranging from $4 to $20 per check — exceed the minimal cost of digital transactions, which is about 30 cents per transaction. This discrepancy highlights an opportunity for businesses to transition from legacy payments to more efficient digital alternatives.

Digital Payments Cut DSO and Enhance Cash Flow

Switching to digital payment channels can streamline the payment process, effectively reducing DSO and improving overall financial health. Consider 83% of firms said adopting fully electronic payment processing is essential. Digital payments not only speed up transaction times but also enhance payment reliability and accuracy.

The growing preference for digital payments among vendors underscores this shift. Approximately 79% of vendors prefer digital payments, such as wire transfers, automated clearing house transactions and virtual cards, due to quicker processing times. Digital payment portals enable suppliers to receive payments easily and securely, offering features like supply chain financing and discounting to encourage timely payments. These advancements contribute to better cash flow management and stronger business relationships.

A study by Citizens Financial Group showed that 97% of middle-market firms that adopted digital treasury processes saw improvements in cash flow processing, with 96% noting better financial visibility and control. This level of efficiency is important, as 94% of treasury departments using checks plan to transition to digital payments within the next five years. Instant payments further improve transaction speed and efficiency, with 77% of mid-sized businesses adopting such methods this year.

Enhancing Customer Experience Through Digital Payments

Digital payments are proving beneficial not just for operational efficiency but also for strengthening customer relationships, the PYMNTS Intelligence report found. In B2B transactions, digital payment options have been shown to boost customer satisfaction and loyalty. Seventy-two percent of business buyers are more loyal to companies that offer their preferred digital payment methods, while 91% of manufacturers deem real-time payments essential for improving supplier relationships.

For small- to medium-sized businesses (SMBs), digital payments are becoming a key competitive advantage. Fifty-four percent of SMB owners would switch banks for same-day ACH payments. Additionally, 90% of SMBs prefer receiving B2B payments electronically, and 78% opt for electronic payroll. The growing use of artificial intelligence in payment systems underscores a broader trend toward digital transformation.

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