The world is full of once-brilliant innovations that — despite having been supplanted by an even better innovation — continue to have devotees who insist the 1.0 version was actually superior:
Writers who prefer the feel of a typewriter to a computer.
Music aficionados who swear that digital distorts the sound of music.
And there’s the paper check — a 1.0 solution in a world of digital payments that continues to stick around. Checks have a long and frequently complained about history of being both slow and costly — a friction-filled paper-based payments method. Issuing a paper check can cost a company anywhere from three to ten dollars per check, and can consume as much as three weeks of time for printing, mailing, receipt, deposit and clearing.
It’s not because anyone prefers the aesthetic of its feel, sound or look, but when it comes time for a business to pay a consumer, the check is often the go-to option. It may be a three week end-to-end process, but every enterprise is set up to pay by check – and every consumer knows how to cash one.
Ingo Money exists to make digital push payments just as ubiquitous and a whole lot less friction-filled for consumers and businesses.
“The first use case of push payments was ‘Hey let’s try to figure out how to cash a check on the phone and push it to any card,” Drew Edwards, founder and CEO, Ingo Money told Karen Webster of Ingo Money’s first few years.
But as of today, with the announcement of the expansion of their partnership with Visa and the roll-out of Ingo Instant Payments, the scope of their push payments remit has expanded.
“This is more about getting to the root of problem and killing the check. Our partnership with Visa will make it easier for banks and merchants and corporates and governments to push payments to any consumer debit card,” Edwards said.
Fixing An Asymmetry
To kill the paper check, Edwards told Webster, businesses have to have an accessible option that’s better.
Insurance companies — or government agencies — don’t have a fleet of developers and payments experts at the ready, so, as Edwards described, they are “looking for push payments in a box” in much the way business can easily find “out-of-the-box” services when they want to take a payment from a customer as opposed to make one.
“We’ve built that for push payments so that companies can push payments, as opposed to just accepting payments.”
The Visa Partnership
Ingo Money’s network of networks enables corporations — think insurance companies paying claims to its insureds — to push payments to any debit card that any consumer has — and route those payments the fastest and cheapest way possible. With Visa, the network that powers 70 percent of the debit cards in the U.S. market today, Ingo’s turnkey Instant Payments platform will make that happen immediately for any corporation or government wishing to pay any consumer with a Visa-branded debit card instantly via Visa Direct.
And this, Webster noted, is not a trivial amount of money — this is a $9 trillion opportunity that is largely paper-based today. Ingo provides all the necessary conditions for making a push payment — a sponsor bank, velocity controls, settlement resolution.
Moreover, Ingo Instant Payment can provide all that functionality and speed — while providing for customer security.
“This is where our history of taking risks on checks pays off. We have a long history of digital check processing and pushing funds to any card, and making sure that we can authenticate and know exactly who it is that we are cashing the check for and giving money to. So we get to apply that same technology stack to authenticate that consumer when a company says to send money to that person,” Edwards told Webster.
The check does not live on because it is beloved — but because when it comes time to initiate a payment in-house, the check has the merits of being consistent, comprehensible, universally accepted and what everyone knows how to issue and cash. If the alternative requires an expensive technological upgrade and an extensive education in developing payments APIs — businesses without an inherent interest in payments and financial services are going to stick with paper.
But if an easy instant solution is available out of the box?
Ingo and its turnkey Instant Payments platform is set out to make the check’s necessary use cases now considerably smaller.