Help Divorced Parents Manage Their Financial Obligations WHAT's INSIDE FEATURE STORY NEWS & TRENDS

Feature Story What happens when marriages end but financial collaboration doesn’t – p. 6

News & Trends Saudi Payments partners with Vocalink on real-time transfers – p. 10

Deep Dive Digging into the growing demand for faster payments in the gig economy – p. 14

JUNE 2019

HOW MOBILE TECHNOLOGY CAN Help Divorced Parents Manage Their Financial Obligations WHAT'S INSIDE FEATURE STORY NEWS & TRENDS

The Reserve Bank of Australia Laura MacMahon, Family Recent headlines from around struggles with slow NPP Plan’s co-founder, on the faster payments space, adoption while Vocalink helps designing an app that helps including RT1’s expansion develop instant payments in divorced parents quickly and into Finland and Avidia’s move Saudi Arabia conveniently split childcare to join The Clearing House’s expenses Real Time Payments platform 03 06 10

DEEP DIVE SCORECARD ABOUT

A look at both the issues The results are in. See the Information on PYMNTS.com hindering gig economy top scorers and a provider and Fiserv payment speeds and limiting directory featuring 47 players growth, as well as the in the space, including three numerous efforts being made additions. to combat such problems 14 16 40

Table of CONTENTS The Faster Payments Tracker is powered by Fiserv, and PYMNTS is grateful for the company’s support and insight. PYMNTS.com retains full editorial control over the following findings, methodology and data analysis.

Well-functioning subway systems require far more than payment system. This move brings coverage to nearly tracks with trains that can quickly shuttle passengers all of Finland, the company stated. between stops. They also need the right amount of sta- The faster payments space is growing quickly, too, tions, otherwise riders will not find the system useful. and the global real-time payments market is expect-

ed to reach a compound annual growth rate (CAGR) The case is the same for faster payment rails. If too of 30.6 percent between 2018 and 2025. Maintaining few banks implement a new payment system, that this growth will require not only developing instant service has a much-reduced chance at ubiquity. Very payment systems, but also devising ways to facilitate few consumers and businesses would be able to use and encourage adoption. the rail, potentially causing them to stick with legacy methods to ensure that recipients are able to accept AROUND THE FASTER PAYMENTS transferred funds. WORLD The Reserve Bank of Australia (RBA) is currently fac- Payments system testing solutions provider Iliad is ing these problems with its New Payments Platform working to promote uptake of The Clearing House (NPP). The service has delivered limited utility be- (TCH)’s Real-Time Payments (RTP) network. The for- cause its major bank participants have largely failed mer recently released a virtual testing platform to help to offer full functionality, leaving customers less in- FIs and gateway service providers design products for terested in the service as a result. The RBA has RTP by allowing them to trial scenarios, system capa- proposed sanctioning those that do not support the bilities and more. system’s core capabilities as well as loosening restric- Brazil has been developing a faster payments system tions, thereby enabling entities without authorized of its own, and its central bank has announced it has deposit-taking institution (ADI) licenses to participate moved its launch date up a year. The rail was expected in the network. to be released in 2021 but will now be completed next Having major banks’ cooperation is important for fi- year. The Central Bank of Brazil also released a QR nancial institutions (FIs) like RBA, as such entities code that can be used to facilitate real-time payments. have larger customer and subsidiary bases. This Saudi Arabia is working toward faster payments as allows payment rails to quickly reach numerous cus- well, with the Saudi Arabian Monetary Authority’s tomers, which drives adoption. EBA CLEARING has (SAMA) fully owned subsidiary, Saudi Payments, re- been far more successful at partnering with major FIs, cently partnering with instant payment systems recently adding six Finnish banks to its RT1 instant company Vocalink to support the project. Real-time

© 2019 PYMNTS.com All Rights Reserved | 3 electronic payment solutions provider ACI Worldwide is planning to help FIs onboard once the system Executive launches. For more on these stories and other faster payments INSIGHT headlines, check out the Tracker’s News and Trends section (p. 10).

HOW PAYMENT APPS HELP What are some of the challenges that come DIVORCED PARENTS AVOID with enabling real-time payments in the BUDGETING TENSIONS gig economy? Splitting childcare costs can be tricky for divorced “While real-time payments may be facilitated easily in some parents who have to send support payments to each geographies, there is not a standard way to make these other in a timely manner while still managing their rela- payments within the U.S. And, while there are real-time op- tionships’ emotional complications. Laura MacMahon, tions available, they each have some drawbacks. co-founder of Family Plan, a childcare expense shar- Visa and Mastercard provide real-time payments to almost ing app for divorced parents, believes the right mobile all financial institutions in the U.S. using ‘push to debit’ solution can help. For this month’s Feature Story (p. technology — Visa Direct and MoneySend, respectively. However, the interchange-based pricing model associat- 6), MacMahon discusses what it takes to design an ed with this technology may not be viable for some gig app that reduces tensions between divorced parents, economy companies. Uber and Lyft, for example, recent- enabling them to quickly reimburse each other, track ly announced options to allow drivers to be paid right after owed payments and keep the focus on their children. a trip is complete. With 5 million to 7 million trips completed on a daily basis, the cost of paying drivers after each INSIDE WHAT'S ride via an interchange-based model quickly becomes DEEP DIVE: THE GIG ECONOMY’S prohibitive. Instead, the companies have announced their CASE FOR FASTER PAYMENTS decision to launch their own private label debit cards, onto Most American workers are expected to work in free- which drivers’ [wages] can be deposited. lance roles by 2027, but gig economy activity could Pushing payments to a prepaid debit card presents its own grow much faster if payments picked up their pace. set of challenges. If the card’s [bank identification number] is not enabled to receive real-time payments by the issu- Many gig workers say they would do more work if they er or processor, payments may not get delivered in real were compensated faster. This month’s Deep Dive time. Many private label wage cards are impacted by the (p. 14) examines the issues arising from delayed gig same issue.

disbursements and how solution providers and em- The Clearing House has launched real-time payments via ployers are working to streamline payments. the RTP Network … [but] many smaller to mid-size institutions are not [members]. … It will still be a few years before JUNE UPDATES this network reaches ubiquity. NACHA’s Same Day ACH scheme enables faster, yet not real-time, payments. Same The June Faster Payments Tracker profiles 47 play- Day ACH payments settle the same business day. ers in the space, including three additions: Buckzy, … Finally, delivering faster payments requires a robust Checkbook and Volante Technologies. compliance and risk management program to ensure all federal and state money transmission regulations are met, … [and that there are] adequate fraud and risk mitigation controls to prevent losses.”

DEVA ANNAMALAI

senior director of payments strategy and solution WHAT'S INSIDE WHAT'S consulting at Fiserv

24% 82% Year-over-year increase in Share of businesses that WHAT'S INSIDE WHAT'S Same Day ACH payment said real-time payments volume between Q1 2018 resolve current payment and Q1 2019 challenges

20M $13B Estimated number of Value of payments transactions processed processed on by RT1 between Australia’s NPP November 2017 in April 2019 and May 2019

HOW MOBILE TECHNOLOGY Can Help Divorced Parents Manage Their Financial Obligations

Children and childcare expenses can often force di- “If parents are given an easy, businesslike way to take vorced parents to stay in communication with each care of the most high-conflict area of divorce — which other when they rather wouldn’t be, sometimes result- usually ends up being money — then that creates ing in uncomfortable exchanges and disputes over space for them to … focus more on the happiness and who owes what. The complications involved in tally- health of the whole family,” she said. “[That entails] ing and balancing receipts add yet another tense layer making sure you can make payments quickly without to the dissolution of a marriage. fuss, avoiding the emotional turmoil of having to meet up in a parking lot to hand over cash, because those Child-related expenses must be addressed despite face-to-face interactions are really when the conflict former partners’ communication barriers, howev- can come to a head. … Being able to make payments er. Parents need to make a variety of purchases for and requests quickly and have it all happen in a busi- their children — such as new clothes, braces, sum- nesslike format minimizes that conflict.” mer camp and more — but handling these budgeting matters is difficult, even among partners who have di- Family Plan, which also supports scheduling and vorced amicably. Such matters become even more communications — two other key areas that affect complex as parents remarry and bring additional divorced parents — was inspired by MacMahon’s per- caregivers into their children’s lives. sonal experience of marrying a man who shares four children with an ex-partner. It was for this reason that Laura MacMahon co-founded Family Plan, an app that facilitates ex- “Trying to track the schedules, expenses and commu- pense sharing between divorcees. MacMahon, who nications that are required to run a family that has is also the president of the company, stated that the gone from one household to two households is real- app’s design keeps payment services swift, stream- ly chaotic,” she explained. “There’s too many moving lined and professional. parts to keep track of it manually.”

TAKING FRICTIONS OUT OF used, but the bank transfer option is quicker, more af- FINANCES fordable and therefore more popular, she explained.

Former spouses must handle recurring alimony and “When one parent is wondering when the next pay- child support payments, as well as sudden expenses ment will come through from the other, it inherently like medical bills. Apps like Family Plan can reduce causes tension and potential conflict,” MacMahon the stress involved in negotiating payments and bill said. “[We focus on] making data entry very easy and splitting by providing features that automate recur- seamless … and the fact that something can happen ring expenses, track qualifying in-the-moment costs almost immediately — a request comes through and and provide purchasing visibility, MacMahon said — you’re able to pay it, and the other parent receives including into which elements have been reimbursed that payment in a really timely manner — that reduc- and which are still due. es all of that friction. We also wanted to have the most Family Plan offers quick money transfers within its cost-effective solution on the market for co-parents app, too, with funds delivered directly to users’ bank on a tight budget.” accounts via a Fiserv integration. PayPal can also be FEATURE STORY FEATURE FEATURE STORY FEATURE

8 | © 2019 PYMNTS.com All Rights Reserved It was important for Family Plan to enable custody cal- endar tracking and agreements, she added. Parents who use the app are also more secure should they become involved in a dispute that warrants judicial Under The intervention, as Family Plan keeps a comprehensive record of users’ messages, payments and other infor- HOOD mation — all of which are admissible in court.

EXPANSION PLANS Family Plan is currently only available in Canada and the United States, but it plans to take its product glob- How does Family Plan keep payments and al. MacMahon believes this will not require much user data secure from fraudsters? adjustment as the app is designed to work alongside local regulations in multiple jurisdictions, while also accommodating partnership agreements between “These days, security is more important than parents and their lawyers. ever, and it’s getting more and more difficult “People are getting divorced all over world,” she said. to do that. Family Plan incorporates multi- “People are people no matter the language they speak. ple security measures to protect user data. They’re all having the same issues.” Our mobile app utilizes secure connections

FEATURE STORY FEATURE STORY FEATURE from the user’s device to the server where MacMahon added that Family Plan’s expansion isn’t sensitive data is encrypted. Forging strate- just geographical. The app has also seen strong de- gic partnerships with companies like Fiserv mand from former partners who share pets, a group — which have industry-standard security that needs to similarly coordinate custody schedules measures — allows Family Plan to focus on and handle payments like vet bills. the core family feature of the app while we let Divorcees can find communicating over finances to our FinTech experts really focus on handling be a tense experience, and that is true regardless of the security of transactions. [This] enables whether they are paying for pets or children. Solutions us to deliver risk protection against financial that ensure each party is quickly and fairly com- crimes, including check and electronic pay- pensated can help ex-partners heal and focus on ment fraud, money laundering, sanctions, their families. violations and tax evasion.”

LAURA MACMAHON, president and co-founder of Family Plan FEATURE STORY FEATURE STORY FEATURE

Instant systems company, Vocalink, to upgrade the country’s payments infrastructure and enable instant system debuts account-to-account (A2A) transfers. The platform and developments will support instant credit transfers, eBilling, eInvoic- ing, remittances and bulk payments, and consumers BRAZIL TO LAUNCH REAL-TIME will be able to make real-time person-to-person (P2P) PAYMENTS BY 2020 transfers via their smartphones — without having to Roberto Campos Neto, the president of the Central identify recipients by their bank account details. Ziad Bank of Brazil, has announced that the timeline for Bin Bandar Al-Yousef, Saudi Payments’ managing di- the country’s instant payments system has been ac- rector, believes this will help Saudi Arabia become celerated. The central bank originally anticipated a cashless and produce long-term benefits for busi- 2021 launch date, but now expects the service to be nesses and consumers. operational by 2020. The new rail will ensure that payments and bank account transfers arrive and clear TCS FACILITATES CANADIAN within 20 seconds. QR codes that can facilitate in- PAYMENT MODERNIZATION stant payments will accompany the system, providing Tata Consultancy Services (TCS), an IT, consulting, small businesses with a low-cost way to accept trans- digital solutions and technology company, is seeking fers and preventing them from shelling out funds on to help FIs upgrade their solutions to align with the expensive card readers and fixed point-of-sale (POS) goals of Payments Canada’s payments moderniza- terminals. tion program. The former is also looking to support real-time payments implementation and provide pay- SAUDI PAYMENTS PARTNERS ment overlay services in Canada with its core banking WITH VOCALINK ON INSTANT software suite, TCS BaNCS for Payments. The solu- PAY INFRASTRUCTURE tion is certified for use with SWIFT global payments Saudi Arabia is also working toward a real-time sys- innovation (gpi) and includes features such as uni- tem. Saudi Payments, a fully owned subsidiary of fied operations monitoring, anti-money laundering the Saudi Arabian Monetary Authority (SAMA), re- (AML) and fraud monitoring and payment analytics, cently partnered with Mastercard’s instant payment among others. NEWS & TRENDS NEWS

10 | © 2019 PYMNTS.com All Rights Reserved Real-time participation EBA CLEARING EXPANDS IN FINLAND Bank-owned pan-European payment infrastructure provider EBA CLEARING recently announced that its RT1 real-time euro payment platform has expanded its coverage with the recent addition of six Finnish banks. These FIs — which include Bonum Bank, the Central Bank of Savings Banks Finland, Danske Bank A/S Finland Branch, Nordea Bank, OP Corporate Bank and Svenska Handelsbanken — have strong presenc- es in the local retail payments market. Other RT1 participants include banking communities in Austria, Estonia, Germany, Italy, Latvia, Lithuania and Spain. The scheme has more than 2,300 participants in total.

ACI WORLDWIDE PARTNERS TO SUPPORT PAYMENT RAIL ONBOARDING IN SAUDI ARABIA ACI Worldwide, a real-time electronic payment solutions provider, is helping Saudi Arabian banks adopt real-time payments via a strategic global partnership with Vocalink. This arrangement will allow ACI to as- sist Saudi banks with quick and secure onboarding to the kingdom’s forthcoming instant payments system.

The partnership will utilize ACI’s UP Real-Time Payments solution and Vocalink’s Immediate Payments Solution (IPS) to help banks join the network. ACI has previously facilitated real-time payments in Australia, Malaysia, Singapore and Thailand.

RESERVE BANK OF AUSTRALIA URGES NPP ADOPTION Uptake of Australia’s real-time payment system, the New Payments Platform (NPP), has been painful- ly slow due to banks’ sluggish implementation. The country’s four major banks are NPP participants, but NAB is the only one offering the solution across all of NEWS & TRENDS NEWS & TRENDS NEWS

© 2019 PYMNTS.com All Rights Reserved | 11 its digital channels. Westpac enables its main-brand and strategy at TCH, noted that other small banks and customers to use NPP, but has not offered the service credit unions are also slated to join RTP. to its subsidiaries’ customers. ANZ Banking Group The Federal Reserve announced last October that it does not offer the product through its app, and the was considering the creation of a real-time system, Commonwealth Bank of Australia has been rolling the and the subsequent debate revealed that many small- solution out across its platforms in stages. Assistant er banks believe it would be more likely to serve its Governor Michele Bullock of the Reserve Bank of own interests than TCH, which is owned by large FIs. Australia recently stated that limited adoption has re- RTP participation by smaller players could alleviate duced the NPP’s utility and made it more difficult to such concerns, enabling TCH to fend off competition encourage usage among consumers. from the government.

ILIAD PREPARES RTP TESTING The Clearing SOLUTION House’s RTP Payment systems testing solutions provider Iliad COMMUNITY BANK AVIDIA Solutions recently released a software-as-a-service JOINS RTP (SaaS) offering to help FIs and gateway service providers develop and adopt offerings that use RTP. The Massachusetts-based Avidia Bank, which holds $1.6 new platform enables virtual testing by modeling net- billion in total assets, recently announced it will give work elements, setting up test scenarios based on its customers access to The Clearing House’s (TCH) NEWS & TRENDS NEWS providers’ environmental demands and quickly trial- & TRENDS NEWS & TRENDS NEWS Real Time Payments (RTP) network. RTP will provide ing system changes. the mutual community bank’s customers with immediate payment transmittal, clearance and settlement, Iliad CEO Anthony Walton said the product en- and Steve Ledford, senior vice president of product ables members to quickly assess their RTP-related

12 | © 2019 PYMNTS.com All Rights Reserved capabilities. Such testing can reduce associated Focus on treasurers costs and complexities while ensuring that FIs and gateway service providers meet all necessary require- KYRIBA PROVIDES RTP ments before seeking RTP certification. INTEGRATION WITH JPMORGAN API Cloud treasury and finance solutions provider Kyriba is Cross-border seeking to connect its clients with a broader array of payments transaction options by enabling real-time payments. The company collaborated with FI JPMorgan Chase RIA JOINS RIPPLENET on a service that leverages the latter’s application No matter how fast domestic payments become, programming interface (API), enabling clients of both businesses and consumers will not be satisfied un- companies to use RTP. til international payments move at the same pace. Sairam Rangachari, JPMorgan’s global head of open Payment service provider Ria Money Transfer, a banking, stated in a press release that payments will Euronet Worldwide subsidiary, sought to support its be processed and confirmed within seconds. The clients’ faster cross-border payment needs by joining release also noted that Kyriba is the first treasury plat- RippleNet’s network of 200 FI members. Ria hopes its form to offer real-time payments to corporate clients participation will provide customers with quicker and through JPMorgan. more transparent international transfers. RippleNet

NEWS & TRENDS NEWS & TRENDS NEWS also supports end-to-end tracking, fee visibility, de- CITI RELEASES ID VERIFICATION, livery time estimates and status information, and its AUTHENTICATION SOLUTION customers will now be able to access Ria’s interna- Verification processes need to become faster as pay- tional FinTech ecosystem. ment speeds increase, an issue that Citi’s Treasury and Trade Solutions (TTS) division is tackling with its ECB PARTNERS TO OFFER SWIFT GPI WITH TIPS new Citi Verify identity and account verification solution for corporate treasurers. The product enables The European Central Bank (ECB) and SWIFT U.S.-based companies to use authentication solu- are collaborating to provide Europe with instant tions provider GIACT’s real-time identity verification cross-border payments, enabling SWIFT’s gpi to work and authentication platform to validate their domes- with the TARGET Instant Payment Settlement (TIPS) tic customers prior to transacting. This spares firms system and its 24/7 access to funds. The service will the expense of misdirected payments and gives them be trialed by a group of European banks, including confirmation that their transactions have successfully Banque Internationale à Luxembourg, BBVA, Deutsche processed, according to Alberto Casas, North America Bank, Natixis, Santander and UniCredit. SWIFT can payments and receivables head at Citi TTS. Citi Verify enable rapid payments across borders, but cannot also provides identity verification and authentication guarantee that payments will settle quickly upon ar- capabilities such as customer intelligence. riving at recipients’ domestic clearing systems. This issue is resolved through the partnership with ECB and TIPS access. NEWS & TRENDS NEWS

The growing demand for faster payments in the gig economy

THE GIG ECONOMY’S CASE FOR payout options as well as the efforts being made to FASTER PAYMENTS prevent such problems. The gig economy is rapidly expanding, with PYMNTS’ research finding freelancers comprised 32.6 per- PAYMENT PAINS LIMIT GROWTH cent of the U.S. workforce in Q4 2018 — a number A PYMNTS survey found that freelancers ranked sav- that’s expected to claim the majority share by 2027. ing for major life events, paying daily bills, acquiring Workers are often drawn to gig work for its flexibili- funds for discretionary purposes and supporting hob- ty and often remote options. Some freelancers string bies were the second- through fifth-most important together short-term jobs as primary revenue sources, reasons for taking on gig work, respectively. Job flex- while others turn to gig work to supplement full-time ibility took the number one spot, but it remains clear employment. These workers are also beneficial for that funds are a major motivator for those in the businesses looking to lower costs, fill skill and knowl- gig economy. edge gaps and manage intermittent needs, such as A separate PYMNTS survey found that these workers seasonal demands and those for one-off projects. often have to wait to receive their wages, with only 51 Both sides of the coin are interested in the gig econ- percent of respondents being paid within a week of omy, but the space’s growth is hampered by slow, completing a job. Additional research found that just inconvenient payment methods. This month’s Deep 17 percent of freelancing platforms offered real-time Dive explores the barriers constraining the industry’s payments, and that 29 percent of gig workers did not

14 | © 2019 PYMNTS.com All Rights Reserved © 2019 PYMNTS.com All Rights Reserved | 14 receive compensation for their work, while 27 percent PAYMENT METHOD APPROACHES had been paid late. Employers that do not use fast, modern payment Delays such as these deter workers from participating methods risk losing workers to competitors. Paper in the sector. A PYMNTS report found that 85 percent checks can often be viewed as unfavorable because of freelancers would work more if they were compen- they take quite a while to make their way through the sated quickly. A related Tipalti report found that 73.7 mail. Recent research has found that 29.2 percent of percent of surveyed gig workers would leave free- gig workers who found jobs on digital marketplaces lance marketplaces over payment issues. and 46 percent of those who found work outside of such platforms received at least some of their wages PROVIDING BETTER PAYMENT in this way in Q3 2018, however. PROCESSING Digital payment methods can remove these delays Legacy invoice processing methods can extend how while also sparing employers the costs and work long freelancers must wait for compensation. Those associated with manual, paper-based processing. seeking to build positive relationships with work- Companies that hire the same freelancers regularly ers they frequently hire and improve their abilities may find direct deposits useful, but this method falls to recruit temporary talent would be wise to consid- short when it comes to unbanked workers. Money er automated accounts payable solutions, according transfer services like PayPal can fill this gap and pro- to current research. Gig workers could then automat- vide expedited services, though there are some fees ically deduct payments from repeat clients’ accounts associated with such platforms. Another approach is with recurring ACH payments or capabilities provided to disburse funds directly to prepaid payroll cards. by third parties. Businesses that rely heavily on contractors or free- Many businesses operate on two-week pay periods, lancers often build out their own instant payment a factor which may not meet freelancers’ needs or services. Rideshare companies Uber and Lyft utilize expectations. Several third-party providers (TPPs) custom payment platforms that provide drivers with want to trim this timeline with instant access to earn- instant access to earnings for a fee. Lyft’s Express ings. Those that utilize such payment services enable Pay service, which enables drivers to receive their workers to use apps to disburse earned funds directly earnings up to five times per day, provided 58 per- to payment cards or into their bank accounts. cent of the company’s payouts from January through Contractor-focused mobile platform Thor, which October 2018. recently closed its doors, believed that identity veri- Businesses and payment service providers are adopt- fication and available balance confirmation are major ing a variety of strategies to tackle payment pains in hurdles hampering transaction speeds. It also noted the gig economy. This means it is likely that new inno- that per transaction costs can further slow payouts by vations and approaches will continue to be discovered encouraging employers to bundle and issue payments as companies explore ways to better appeal to their together, which is cheaper than paying each contrac- increasingly important freelance talent bases. tor separately. Thor sought to solve these issues by using blockchain to accelerate cryptocurrency payment verficiation. DEEP DIVE DEEP

If you would like your company to be considered for inclusion in this Tracker’s provider directory, or if you would like to have an existing listing reconsidered for an update, visit our profile submission/update page.

Companies are organized in alphabetical order.

American Express Serve offers prepaid debit card accounts, with money management capabilities and cash load features. Its mobile app supports sending and receiving payments between Serve accounts, check capture, online bill payment and early direct deposit.

American Express Serve VERTICALS