Checks are persistent. Businesses and governments keep using them for payroll, a wide range of disbursements, benefits, tax payments and payments for services rendered to microbusinesses.
Beyond that, 29% of the payments that small- to medium-sized businesses (SMBs) receive are still made via check, according to the “Money Mobility Playbook,” a PYMNTS and Ingo Money collaboration.
Get the report: Money Mobility Playbook
Given that fact, FinTechs face a key challenge: enabling customers to use any number of payment methods — including checks — to move money across any number of different endpoints.
Supporting a Range of Payment Methods
Things can get complicated quickly, Ingo Money CEO Drew Edwards told PYMNTS in a March interview.
Once customers get a taste of the payment methods on offer, it becomes a rapidly linking chain of add-ons, Edwards said, adding that FinTechs often start out thinking about automated clearing house (ACH) and push to card, then find out quickly that they need to add PayPal, Venmo, RTP, cash payouts, checks and more.
“It becomes, literally, a never-ending evolution,” Edwards said.
The ability to move money into checking accounts — from digital and nondigital sources — and out of those accounts to any person or business — instantly and securely — is customers’ new baseline.
This “money mobility” is foundational to the future of the digital economy — and to any financial services stakeholder who wants to remain relevant with an increasingly digital-first consumer.
Partnering With Money Mobility Platforms
A money mobility network orchestrates a complex web of accounts, payment methods and third parties to streamline the flow of money for account holders —securely and at scale. It lets FinTechs and other financial-services providers create account utility and ubiquity by supporting instant access to flows into an account from any payment method, including by check or cash.
A money mobility network also supports instant payments out to anyone, including to accounts a consumer has or may want to establish with other banks and nonbank entities.
Fundamental to the role of any effective network is access to rich historical data on fraud and bad actors, particularly for enabling instant access to check and cash deposits as well as instant digital transfers. Access to a deep pool of data reduces the fraud risk associated with supporting traditional and nontraditional payment methods — without the need to limit access to a small fraction of the customer base over fraud-related fears.
For FinTechs to achieve parity with incumbent financial services providers, it requires alignment with a money mobility platform that delivers risk managed consumer-driven ubiquity: how money moves in and out of their accounts to anyone, from anyone, from any payment method.
By doing so, FinTechs can unlock new sources of value that they can use to create a more loyal customer base — and stronger sales and profits, as well.