Author: Julie Muhn (@julieschicktanz)

Koverly Launches BNPL Solution for FX Payments

Koverly Launches BNPL Solution for FX Payments
By Julie Muhn (@julieschicktanz) Posted on
Categories: Daily news
  • Koverly is launching KoverlyPay, a new B2B BNPL tool.
  • KoverlyPay offers businesses a 30-day extension on FX payments.
  • Clients can use KoverlyPay to extend payments over four, eight, or 12 fixed weekly installments.

B2B payment tool Koverly is jumping on the buy now, pay later (BNPL) trend this week with the launch of its newest tool. The Massachusetts-based company unveiled KoverlyPay, a new B2B BNPL tool that offers a free, 30-day extension on FX payments.

Koverly clients can use KoverlyPay to extend payments over four, eight, or 12 fixed weekly installments. Businesses can apply for the financing using KoverlyPay, which is integrated into the point-of-sale, at checkout and receive a decision within 24 hours. Once a business is approved, they do not have to repay their purchase for the first 30 days. After the initial 30 days, for both FX and local payments, businesses pay as low as 1.5% interest per month.

“Inventory is the lifeblood for importing businesses, and it is directly impacted by cash flow,” said Koverly CEO Igor Ostrovsky. “Our KoverlyPay offering for FX transactions is designed to give businesses enough extra working capital to unlock at least one additional inventory turn per year. For a typical importing business, this can boost annual profitability by 50% to 100%. This is a game changer for global trade.”

As growth in the B2C BNPL space begins to slow, interest in B2B BNPL has seen growth. Melio, Allianz Trade, Yapily, and others have recently launched B2B BNPL tools. Banks have started implementing stricter small business lending practices, and we can expect to see small businesses pursue working capital via alternatives channels such as BNPL expand.

Koverly combines foreign exchange and credit into its invoicing, billpay, and accounting tools. The company, which currently processes $200 million a year in both domestic and international payments, launched global payment capabilities last summer. Today, global payments account for 50% of the company’s volume. 

Since it was founded in 2021, Koverly has received $7.6 million in Seed funding from Vinyl Capital, One Way Ventures, and Accomplice.

Photo by Anna Nekrashevich

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Ramp Raises $300 Million at a $5.8 Billion Valuation

Ramp Raises $300 Million at a $5.8 Billion Valuation
By Julie Muhn (@julieschicktanz) Posted on
Categories: Daily news, Funding
  • Ramp landed $300 million in Series D funding today, bringing its total funding to $1.7 billion.
  • Today’s funds come from new investor Sands Capital, along with existing investors Thrive Capital, General Catalyst, and Founders Fund.
  • At $5.8 billion, the company’s current valuation is 28% lower than its 2022 valuation of $8.1 billion.

Late-stage VC funding has been down in 2023, but business finance automation platform Ramp is bucking that trend today. The New York-based company has announced the closure of a $300 million round of Series D funding.

The investment boosts the company’s total funding to $1.7 billion. With the increase in capital, however, comes a decrease in valuation. The company’s current valuation now sits at $5.8 billion, 28% lower than the company’s $8.1 billion valuation reported last year.

Today’s Series D round comes from new investor Sands Capital, along with existing investors Thrive Capital, General Catalyst, and Founders Fund. Ramp will use the funds to fuel product development and accelerate its expansion into adjacent categories.

“In the last year alone, we’ve expanded Ramp’s offerings to become the only platform in the market that’s designed to save businesses time and money,” said Ramp CEO Eric Glyman. “Our mission is to help our customers build healthier businesses and this funding will help us execute against our goal to continue expanding the Ramp platform to better serve customers. At Ramp, we succeed when our customers can run their business more efficiently.”

Ramp offers its 15,000 clients access to its suite of payment cards, expense management tools, accounts payable offerings, procurement solutions, working capital, and more. Among Ramp’s recent client wins are Anduril, Poshmark, and Virgin Voyages.

Next month, Ramp plans to debut Ramp Plus, a new set of procurement tools to help finance teams with procurement-related tasks. To support this growth, the company also plans to boost its hiring efforts “significantly” and “across all functions.”

Photo by Anna Shvets

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FinovateFall 2023 by the Numbers

FinovateFall 2023 by the Numbers
By Julie Muhn (@julieschicktanz) Posted on
Categories: FinovateFall 2023, Marketing

If you’re in fintech, then you’re most likely a numbers person. You like to see the metrics, the data, and the quantitative side of things. So we’ve assembled the data surrounding this year’s FinovateFall event to offer a numerical picture of what you can expect at the show, which is taking place September 11 through 13 in New York City. Tickets are still available at a discounted rate.

14th 

This year marks the 14th FinovateFall we’ve held in New York City. Time flies when you’re having fun!

15

We’ll offer 15 networking sessions across the three-day event to ensure you have time to mingle and make meaningful connections.

59

Finovate is known for live demos. This year, we’ll feature 59 (and counting) companies demo their technology live on stage.

27

27 of our demoing companies are new-to-Finovate.

177

We’re hosting 177 speakers on stage. Those 177 fintech experts will discuss a wide range of fintech topics in demos, keynote presentations, panels, and more.

37

37 investor organizations are taking part in our Startup Booster Program.

40

40 of the top 50 banks in the U.S. are attending.

350+

More than 350 banks and financial institutions will be represented.

15

The number of miles from JFK International Airport to Marriott Marquis Times Square. We’ll see you there!

78

It only takes 78 seconds to watch a clip highlighting everything you need to succeed at this year’s event:

Photo by Ryoji Iwata on Unsplash

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Dock Taps Feedzai to Expand Fraud Prevention

Dock Taps Feedzai to Expand Fraud Prevention
By Julie Muhn (@julieschicktanz) Posted on
Categories: Alumni News, Daily news, Feedzai
  • Brazil-based Dock selected Feedzai to provide fraud prevention tools for its customers.
  • Dock will primarily leverage Feedzai’s RiskOps Platform, and will also use the company’s AML and behavioral biometrics tools.
  • Dock counts 70 million active accounts and powers over seven billion transactions each year.

Brazil-based payments technology player Dock announced this week it has selected risk management tool provider Feedzai to provide new fraud prevention tools for Dock customers.

Founded in 2014, Dock offers card issuing and core banking services to help organizations bring new card digital payments and banking services to their existing operations. The company’s microservices architecture can be tailored to suit a multitude of rules, and can operate in any country, currency and banking system. The company counts 70 million active accounts and powers over seven billion transactions each year.

By partnering with Feedzai, Dock is giving its clients access to Feedzai’s RiskOps Platform, a tool that helps uncover criminal activity by standardizing processes. Feedzai launched RiskOps in 2021 to tackle fraud, money laundering, compliance, and enhance risk policies. The platform’s Financial Intelligence Network (FIN) database contains over one trillion data points, sessions, and profiles of good and bad actors. Dock also plans to integrate Feedzai’s behavioral biometrics module as well as money laundering prevention tools to offer customers a view of risks in real-time.

“We are providing our customers with another cloud-first technology solution that delivers a personalized approach to cyber threat detection and assessment, based on machine learning models and supported by Dock’s expertise,” said Dock Risk Director Armando Junior. “This partnership is aligned with our Latin American expansion strategy. The new feature makes it possible for us to understand even better the needs of our customers throughout the region.”

Feedzai was founded in 2011. The company offers tools ranging from KYC, AML, watchlist screening, transaction fraud monitoring, and more to help companies fight fraud in more than 190 countries. In 2021, Feedzai was valued at more than one billion dollars after receiving a $200 million funding round that boosted its total funding to $277 million. There is no word on an updated valuation.

Photo by Leigh Patrick

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Micronotes Adds $2 Million Extension to its Series C Round

Micronotes Adds $2 Million Extension to its Series C Round
By Julie Muhn (@julieschicktanz) Posted on
Categories: Alumni News, Funding, Micronotes
  • Micronotes announced a $2 million extension to its $5.5 million Series C funding round.
  • Today’s funds come from BankTech Ventures.
  • The extension brings Micronotes’ total funding to $23.3 million.

In an industry focused on the customer, engagement solutions providers are poised for growth. Perhaps that’s why digital engagement solutions provider Micronotes received a $2 million extension to its Series C round today.

Today’s funds come from BankTech Ventures and add to Micronotes’ $5.5 million investment led by Experian Ventures with participation from existing investors. Closing the Series C round brings The Massachusetts-based company’s total funding to $23.3 million.

“We’re thrilled to partner with BankTech Ventures,” said Micronotes Founder and CEO Devon Kinkead. “This strategic investment will help us accelerate our growth in the community banking sector and help more communities get a lot more out of their banking relationships.”

Micronotes was founded in 2008 and is privately held. The company leverages AI, big data, and machine learning technologies to help financial institutions use their data to better engage their customers, foster involvement, and ultimately build new revenue.

Photo by Soginoto

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Bridge the Advice Gap by Embracing Opportunities in Financial Advisory Technology

Bridge the Advice Gap by Embracing Opportunities in Financial Advisory Technology
By Julie Muhn (@julieschicktanz) Posted on
Categories: Speaker series

In the dynamic realm of financial advisory, the voice of experience is vital in understanding the present landscape. We recently spoke with intelliflo Vice President of Customer Management Lisa Jacobs on the challenges, opportunities, and trends in the advisory space.

Jacobs brings her 15+ years of experience to our conversation that sheds light on how firms can overcome labor shortages, resource constraints, constantly changing technology, and volatile regulations in the financial advice space. She also addresses how advisors can balance and manage the ongoing high-tech vs. high-touch approach.

What are some of the top challenges and opportunities currently facing the financial advisory space?

Lisa Jacobs: We recently surveyed over 400 financial advisors and found that 80% of them believe more people are seeking advice and can’t find or access that help. This is both an enormous challenge and opportunity. Even though more people are seeking professional guidance, advisors across the board are stretched thin, making it nearly impossible to take on new clients without additional support. This prohibits advisors from growing their revenue and supporting more people, leaving many without the help they need. intelliflo was formed to bridge the advice gap; we’re committed to providing the tools and solutions to help advisors widen access to financial advice.

How can technology be leveraged to overcome these challenges and support financial advisors?

Jacobs: Modern technology has the power to help advisors address these resource restraints. In just about every industry, technology yields efficiencies, but the best tech also increases your customer’s satisfaction, too. In our industry, this is becoming known as a hybrid advice strategy – a flexible model in which clients in earlier stages of the financial advice journey are primarily served via digital channels and tools, and technology adds more to the customer experience for top clients with better outcomes.

To effectively embrace more digital tools, advisors are increasingly moving away from stand-along software tools that can’t integrate with other parts of their tech stack to avoid having to learn and log on to multiple systems. Many are seeking an all-in-one advisor experience to increase efficiencies and, in turn, provide a more unified client experience. If approached the right way, technology has the power to enable advisors to accomplish more with existing resources while simultaneously strengthening client relationships.

What advice do you have for financial advisors that are evaluating the many different technology providers out there?

Jacobs: Technology can only be effective if it is easy to use and manage. Otherwise, it might act as more of a hindrance than a benefit. That same survey of advisors underpinned this idea, revealing that the top three biggest barriers to adopting new technology for advisors are integration challenges (57%), time to install (41%), and employee time and resources to manage the technology (38%).

When vetting the many providers and solutions available in the market, advisors should consider these common areas of friction, prioritizing technology that is open and easily integrated, is flexible (which often means cloud-based), and has proven, responsive service and support teams.

Changing regulation seems to be a pressing topic this year for the fintech industry at large. What is the best way for wealth management companies to stay ahead?

A strong way to stay on top of changing regulations and compliance mandates is to collaborate with resources such as peer groups, associations, and technology partners to discuss these issues and what needs to be altered in response. We also increasingly see firms rely on partnership models with third party vendors, looking to outsource key functions and support such as compliance. However, advisors must be sure their partners are thoroughly vetted and monitored on an ongoing basis; not all partners are created equal.

What are the top trends in the advisory space to watch for the second half of the year?

Jacobs: In addition to the continued rise of the hybrid advice model, the evolving role of the advisor is an important trend to watch. A wider skill set is increasingly expected from advisors, including the ability to provide comprehensive guidance around critical life events and situations that fall outside of the traditional financial advisory relationship. For instance, clients are more frequently asking which insurance plans and options are best for their unique scenarios. And as their parents age, Millennials are seeking guidance from advisors on long-term care and arrangement options. These conversations can be emotionally charged, and empathy will become a key trait for the modern advisor. This is another reason why advisors must determine how to strategically leverage technology to make time for higher-value conversations and plans.

Photo by Amy Hirschi on Unsplash

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Agora Data Services Lands $160 Million for Used Car Financing

Agora Data Services Lands $160 Million for Used Car Financing
By Julie Muhn (@julieschicktanz) Posted on
Categories: Daily news, Funding
  • Agora Data has landed $160 million in privately placed term financing.
  • The investment marks Agora Data’s fourth privately placed term financing round.
  • While there is no word on total funding, today’s financing adds to the $100 million revolving credit line Agora Data received from Credit Suisse in September 2022.

Agora Data, a company that helps buy here pay here (BHPH) car dealers offer in-house financing, secured $160 million in privately placed term financing this month. The round represents the fourth privately placed term financing the company has received since it was founded in 2017.

“Fueling Agora’s mission to enable any car dealer to be a finance company, this $160 million private term financing provides additional funding capacity and reiterates our commitment to our customers’ future growth,” said company CEO Steve Burke.

While there is no data on the amounts of the company’s previous three privately placed term financing rounds, Agora Data said that each of them performed better than projected. Today’s financing adds to the $100 million revolving credit facility the company received from Credit Suisse last September.

Founded in 2017, Agora Data’s Agora Capital helps car dealerships lend to non-prime customers. Lending to unattractive borrowers ultimately helps dealers sell more cars. To provide a competitive interest rate on these sub-prime loans, the company leverages AI to analyze over $350 billion in loan data. Agora Data also offers Agora Trade, a product that allows investors to buy a portfolio of seasoned auto loans at a lower rate of default.

Texas-based Agora Data targets the underbanked community and its strategy will likely fair well as the cost of living crisis, combined with a high interest rate environment, continues. Competitors in the auto financing space include CreditIQ, Creditas, Caribou (formerly known as MotoRefi), and others.

Photo by Jeerayut Rianwed

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Splitit Lands $50 Million, Plans to Delist from the Australian Stock Exchange

Splitit Lands $50 Million, Plans to Delist from the Australian Stock Exchange
By Julie Muhn (@julieschicktanz) Posted on
Categories: Alumni News, Funding, SplitIt
  • Splitit is set to receive $50 million from Motive Partners.
  • The funding will be issued in two $25 million installments.
  • Motive Partners stipulates that Splitit must delist from the Australian Stock Exchange and meet certain performance milestones in order to receive the funds.

There is something poetic about a BNPL company receiving private equity funding in installments. One of the first BNPL players in the market, Splitit, has landed a $50 million investment from private equity firm Motive Partners. The funds, which will boost Splitit’s total funding to $325 million, will be paid out in two tranches.

For Splitit, which is a publicly traded company listed on the Australian Stock Exchange (ASX) under the ticker SPT and also trades on the US OTCQX under tickers SPTTY and STTTF, today’s investment isn’t a straightforward transaction.

Splitit will receive the funds in two $25 million installments in exchange for the issuance of new preference shares. According to the release, Splitit will receive the first installment after two conditions have been met– first, when shareholders approve the company delisting from the ASX and second, after the company moves its incorporation site from Israel to the Cayman Islands. Splitit will receive the second $25 million after achieving certain performance milestones.

Splitit’s board opted to agree to Motive Partners’ transaction terms for five reasons:

  1. The funds offer growth capital in the midst of a difficult fundraising environment.
  2. The partnership with Motive Partners was especially attractive, given the firm’s resources, network, and talent.
  3. The ASX undervalues Splitit’s business and doesn’t appreciate the company’s “differentiated value proposition and prospects.”
  4. The move to become a private, Cayman Islands-based company will offer Splitit more flexibility and less administrative costs.
  5. The move from the ASX will offer existing shareholders the option to choose to retain ownership in Splitit as a private company or to decrease their ownership in the run-up to the delisting.

“Attracting a strategic investor of this calibre is a testament to the quality of our team and our unique, innovative offering– especially given difficult market conditions for raising capital,” said Splitit Managing Director and CEO Nandan Sheth. “This level of investment significantly strengthens our balance sheet, allowing the team to focus on our white-label product strategy, innovation, and our Tier One global distribution partners.”

Splitit was founded in 2012 under the name PayItSimple. The company’s Installments-as-a-Service offering allows merchants to add a white-labeled BNPL option embedded into their checkout flow. Splitit also offers a BNPL tool that works at the physical point-of-sale by pre-qualifying consumers with available credit on their credit card for the value of that available credit.

Earlier this year, Splitit partnered with Atlantic-Pacific Processing Systems to offer BNPL services to their merchants. The company also partnered with Visa to embed a BNPL solution within merchants’ existing credit card processes. Splitit also holds partnerships with Stripe, Shopify, and Alipay to act as an Installments-as-a-Service option for their merchant clients.

Photo by Karolina Grabowska

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Say Hello to Finovate Newcomers

Say Hello to Finovate Newcomers
By Julie Muhn (@julieschicktanz) Posted on
Categories: FinovateSpring 2023

We are less than one month out from FinovateFall. In true Finovate fashion, we are hosting 52 companies to demo their technology live on stage. Most impressively, this year, 27 of the demoing companies are new to Finovate.

Because more than half of the FinovateFall demo companies are new to us, we figured they might be new to you, as well so we decided to make a formal introduction. You can check out all 27 companies below.

Agtools
Agtools offers supply chain market data and analytics for farmers and agriculture workers.

Alto Solutions
Alto Solutions provides an alternative asset investment platform.

Bits of Stock
Bits of Stock is a consumer rewards platform that drives loyalty through Stock Rewards.

Cashy
Cashy provides gamified consumer engagement for credit unions.

CD Valet
CD Valet is a nationwide marketplace connecting consumers with financial institutions to shop, compare, and open certificates of deposits.

Chimney
Chimney helps banks and credit unions launch modern financial tools that provide personalized answers to customers while generating more loans and deposits.

ClimateTrade
ClimateTrade is a climate-tech company that leverages blockchain technology to facilitate large-scale decarbonization efforts.

DataVisor
DataVisor delivers the world’s most sophisticated AI-powered solutions to keep companies and their customers safe from fraud and abuse.

Effectiv
Effectiv offers a fraud and compliance automation risk management platform for fintechs and community financial institutions.

EQUE
EQUE’s digital security helps banks and card issuers eliminate e-commerce fraud.

eself.ai
eSelf is creating the next generation of client-financial institution interaction, enabling human-like conversations and efficient personalization.

HappyNest
HappyNest is a mobile application for real estate investment.

Inscribe
Inscribe helps clients leverage automated manual document reviews to reduce fraud rates and credit losses while increasing customer win rates.

Jaid
Jaid is an AI-powered platform built to enable the intelligent automation of business communications getting to the right answer faster.

Kard
Kard offers rewards infrastructure for card issuers.

MacroMicro
MacroMicro offers macroeconomic investment information to help investors understand economic trends.

Mahalo Banking
Mahalo Banking provides secure, user-driven, digital banking and analytical solutions.

Regulo
Regulo offers face screening for effective compliance and fraud prevention.

SRM Key Moments
SRM Key Moments help financial institutions who are motivated to build more loyal customers and own the payment moment.

SupraFin
SupraFin is a pioneer in crypto investment and risk intelligence products, which help organizations assess risk and invest confidently in crypto.

Telesign
Telesign provides continuous trust to leading global enterprises by connecting, protecting, and defending their digital identities.

True Digital Group
True Digital Group offers products that serve as conduits in strengthening the relationships FIs have with technology, vendors, and each other.

Trustworthy
Trustworthy is an operating system that secures and organizes all family tasks in one place.

Union Credit
Union Credit’s marketplace for credit unions delivers firm credit approval and one-click loan activation to new members, embedded within their daily lives.

Uprise
Uprise provides AI-powered financial advisory for third party platforms.

Viffy
Viffy ties creator influence through to physical brick-and-mortar sales.

Zerobank Design Factory
Zerobank Design Factory develops and operates digital banking systems.

Be sure to keep an eye out for demo updates leading up to the event, which takes place September 11 through 13 in New York. Don’t miss your chance to register!

Photo by Omar López

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Roger Launches to Help New Military Recruits Enlist in a Modern Banking Experience

Roger Launches to Help New Military Recruits Enlist in a Modern Banking Experience
By Julie Muhn (@julieschicktanz) Posted on
Categories: Daily news, NYMBUS
  • Citizens Bank of Edmond is launching Roger, a new digital bank.
  • Roger is geared to serve military service members and their families.
  • Nymbus is powering the new digital bank.

Citizens Bank of Edmond is launching its new digital bank today. Roger, the new digital-first bank, aims to offer tailored banking services to meet the needs of military service members, their families, and their supporters.

“Our vision is crystal clear,” the bank announced on LinkedIn, “to mobilize financial resources that lay the foundation for unshakeable financial strength and future prosperity for every newly enlisted service member.”

Citizens Bank of Edmond CEO Jill Castilla launched Roger because, as a new military recruit 30 years ago, she couldn’t find a bank designed to meet her needs. “When I enlisted at 19, I had little access to my bank accounts and financial tools,” she explained. Castilla went on to lead Citizens Bank of Edmond, a bank founded in 1901 that now boasts $375 million in assets.

To suit its niche set of users, Roger offers a military-friendly direct deposit form and enables recruits to access their earned funds up to two days faster. Additionally, the Visa debit card is accepted at Armed Forces Financial Network terminals located at U.S. military bases worldwide. Users can also set up savings plans and round-up their transactions to contribute to accounts.

In a unique twist on the round-up savings feature, Roger will match users’ savings. For the first 90 days after opening their account, Roger will match 100% of round-ups, up to $100. After that period, Roger will match 15% of round-ups, up to $20 per month. The round up matching feature restarts every 30 days.

In addition to Citizens Bank of Edmond, which is behind the launch of Roger, the bank is leveraging banking technology provider Nymbus to power the digital banking experience. “We’re extremely proud to partner with Citizens Bank of Edmond on this essential niche bank for the military community,” said Nymbus Chairman and CEO Jeffery Kendall. “With Jill’s leadership and vision, we aim to deliver special-purpose products to help military service members succeed.”

Photo by Pixabay

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PayPal Gets a New CEO

PayPal Gets a New CEO
By Julie Muhn (@julieschicktanz) Posted on
Categories: Alumni News, Daily news, PayPal
  • PayPal has appointed Alex Chriss as its new CEO.
  • Chriss, who will replace current CEO Dan Schulman, will begin his role on September 27.
  • Chriss comes to PayPal after a 19-year tenure at Intuit.

Fintech pioneer PayPal is back in the headlines today. After unveiling the launch of its stablecoin last week, the California-based company announced it has appointed Alex Chriss as new CEO.

Chriss will replace Dan Schulman on September 27 of this year. This comes after, earlier this year, Schulman declared his intention to retire. “I’m at a point in my life where I want to devote more time to my passions outside the workplace,” Schulman said in February. He will remain on the company’s Board until May 2024.

After Schulman’s statement, PayPal’s Board of Directors began a six-month long search for a new CEO who could not only drive growth, but also had extensive global payments, product, and technology experience. After an “extensive engagement and evaluation,” PayPal’s Board unanimously agreed on Chriss to lead the company.

“With his depth of experience in product development, his passion for serving customers and his longstanding commitment to empowering and enabling small businesses, and his proven track record of developing and inspiring his team, Alex is the perfect leader to take PayPal forward and accelerate the company’s growth opportunities,” said Chair of the PayPal Board of Directors John Donahoe. “The Board search committee worked diligently and thoroughly to find the right candidate to take PayPal into its next stage of growth and expansion, and we are confident Alex is that person.”

Chriss will join PayPal and its Board from Intuit, where he served as Executive Vice President and General Manager of the company’s Small Business and Self-Employed Group. He has been with Intuit for more than 19 years after starting out as a Group Manager of Business Development and Channel Sales of the Quickbase business unit.

During his tenure at Intuit, Chriss grew the Small Business segment’s customers at a 20% CAGR and its revenues at a 23% CAGR. In 2021, he led Intuit’s successful $12 billion acquisition of Mailchimp.

“PayPal is an extraordinary company that plays a critical role in the lives of consumers and merchants all over the world,” said Chriss. “Throughout my career, I have championed small and medium businesses and entrepreneurs, who are the backbone of every economy in the world. I am proud to take the baton from Dan and thrilled to have the opportunity to work with PayPal’s talented and committed team to build on PayPal’s remarkable history and draw on its unique capabilities to deliver outstanding products and services to businesses and consumers.”

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Sila Ships New Tool to Offer Access to ACH Debits in Real Time

Sila Ships New Tool to Offer Access to ACH Debits in Real Time
By Julie Muhn (@julieschicktanz) Posted on
Categories: Daily news
  • Sila launched Instant Settlement this week.
  • The new tool offers customers real-time access to ACH debits made on the Sila platform.
  • Instant Settlement works with all ACH transactions on the Sila platform and doesn’t require banks to adopt a particular payment rail.

Banking and payment infrastructure-as-a-service company Sila is launching a new product called Instant Settlement this week. The solution offers customers real-time access to ACH debits made with the Sila platform.

As its name suggests, Sila’s new tool offers companies access to funds instantly, without needing to wait the traditional two-to-five day time period of the ACH settlement to clear. Without the need to wait for funds to clear, companies no longer need to pre-fund transactions or rely on their own capital.

With Instant Settlement, Sila pre-funds the consumer’s digital wallet within a matter of seconds. The company’s approach works with all ACH transactions on the Sila platform because it doesn’t rely on any particular payment rail.

“With Instant Settlement, we are revolutionizing the way businesses and individuals access and manage their funds,” said Sila Co-Founder & Chief Strategy Officer Shamir Karkal. “We understand the importance of transaction speed in today’s fast-paced business landscape, and by offering Instant Settlement, we are providing our customers with a competitive advantage that sets them apart in their respective industries.”

Sila notes that Instant Settlement works best in situations such as payroll processing, back-office money movements, B2B transactions, and physical cash transactions where ACH is preferred, but return risks are low. That’s because it requires customers to maintain sufficient funds in a reserve wallet to cover potential return risks.

The timing of today’s release is notable as it comes shortly after the launch of the U.S. Federal Reserve’s launch of FedNow real-time payments system. Sila differentiates itself from FedNow and other real-time payments companies such as RTP because it doesn’t require banks to adopt a specific rail. “While everyone is rushing to RTP (65% coverage) and FedNow both of those instant payment systems are limited by the number of banks that adopt a particular instant payment rail while Sila’s Instant Settlement doesn’t rely on banks to adopt anything and instead, it is applicable to 100% of ACH transactions on its platform,” the company explained.

Sila was founded in 2018 by Karkal, who was one of the entrepreneurs who co-founded challenger bank Simple in 2009. The Oregon-based company has gone on to raise $20.7 million.

Photo by Ivan Samkov

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