Transcript
Speaker 1 – Lou Carlozo
From PayPal to Venmo, to Zelle and beyond, the Payments Revolution is full steam ahead. Yet traditionally banks have been somewhat behind the curve instead of on top of it or ahead of it. What will it take to move into the next generation of payments in a way that financial institutions can embrace?
To tell us more about it, we have Eric Dotson of Aptys here on Bankadelic. From the studios of Karma Productions worldwide in Chicago, this is Lou Carlozo’s Bankadelic, the colorful side of finance where we supply expert views, riff on the news, innovate and investigate actionable insights, unscripted banking for the caffeine kick.
I’m your host, Lou Carlozo so inviting you to sit back, grab a cup of joe, kick up your feet. Here we go. If you’re looking to grow your digital banking business, check out lemonade LXP, the digital growth platform for financial institutions and fintechs. Lemonade LXP has both ingredients you need to drive digital growth, a learning experience platform that uses daily micro learning to give staff the knowledge. The confidence they need to promote and support your digital capabilities and a digital adoption platform that supports your digital capabilities. With technology walkthroughs that you can offer in just minutes.
So, if you’re rolling out new technology, merging with or acquiring another FI or just looking to drive digital banking growth, you gotta drink the lemonade. For more information, check out lemonade LXP at www.lemonadelxp.com. Thanks for tuning in to another episode of Bankadelic, and if you can believe. Leave it 2022 means we are in our second year rolling along, bringing you the best in financial services.
And Speaking of the best. We have Eric Dotson today, Eric is the executive vice president, sales and co-founder of Aptys Solutions. That’s the leading fintech company of cloud-based, multi-channel and real time and mobile payments. Eric has more than three decades of combined experience in the payments industry in the US and internationally. He’s also currently responsible for business development, client relations and marketing for Aptys. He is also returning after one of our rousing Bankadelic holiday episodes. I’m so grateful to have you back, Eric. Thanks for being on Bankadelic.
Speaker 2 – Eric Dotson
Lou, thanks for inviting me. This is great. I’m so excited to be talking with you today.
Speaker 1 – Lou Carlozo
And speaking of excitement, right, Venmo, my son, goes out for a haircut the other day, and I get this flash on my screen. Exciting for him. Maybe not for me because he wants 60 bucks for the haircut. And what does that say? It’s remarkable. This revolution in P2P payments we take for granted, my son takes it for granted, but it didn’t exist a generation ago. From your perch, you’ve got such a direct view into the trends that are lighting up the industry. Maybe you can run us through some of those and why you think they’re important to pay attention.
Speaker 2 – Eric Dotson
Yeah, I’d love to. And if you remember, the old saying, may you live in interesting times, boy, don’t we?
Speaker 1 – Lou Carlozo
Ohh yeah.
Speaker 2 – Eric Dotson
Whether it’s technology or social events or political uprisings, financially, I mean. There’s just so much going on. That’s the same thing in the financial industry these days. We are in interesting times. Change is happening and certainly in all my years in the industry really, I’ve never seen such a rapid change taking place as it is today.
Used to be, in the financial industry, being cautious, right? Being conservative, slow to change that was, I think kind of a badge of honor for the history, right? That it was their job to take care of the money and nobody liked to see a lot of change cause you never knew what would happen. So they moved slowly. However, now we’re seeing a change in the last 20 years. We’ve entered this new information technological revolution. And it’s really upending things, and especially in the financial industry, you mentioned Venmo. At least from our age whose kids haven’t pulled them into Venmo or to some app that they’re trying to get them to use. And my kids are no different. And they got me signed up on Venmo.
I will tell you a funny story. It was around Christmas time, we’re sitting with family and somebody asked me, what are you doing at Aptys? And I talked to them about some of these changes that are taking place. P2P being a big issue. You know, we have a product called PayMoli that’s a P2P application. And I started telling them, one of the things about Venmo is they take your money and they hold it, right. They’ll tell you it’s moving, but it’s sitting in their account. And about that time, my wife, she’s like, what are you talking about? And I’m like, yeah, you know, it’s not going anywhere. It’s sitting in the Venmo account. And she’s like, no. And I’m like, alright, pull up your app so she opens up her app and she has like $600.00 sitting in there. I’m like, you have to tell them to send it to you. They have your money. All these years of hearing me talk and everything she never even knew that. So I had to give her some little instructions there on how to do that.
But, this is what’s happening in the industry. This change it’s being driven by technology. It’s being driven by consumers and businesses being unafraid to go ahead and take up these technological solutions that are coming out. I call it the Googlization of things. Back in the day when Google really was starting to turn up and it seemed like they had their finger in everything, and they were coming out with these solutions and everything they did was for free.
Now, here we are 20 years later, and we have a whole generation that has grown up with this Google experience that if Google could do it and use technology and solve it, and they do it for free to me, why can’t the bank do it? And so, they have this level of expectation to see these changes take place. That’s truly I think what’s kind of driving a lot of this in the marketplace these days. And where things are headed, so P2P is a good example of that. It’s something that’s consumer driven from the bottom up. Now financial institutions are looking to figure out how do they solve that problem; how do they jump into that space so that they can provide those solutions to their customers.
Speaker 1 – Lou Carlozo
You just set up my next question. That is beautiful. How do they solve that problem? How do they get into that space in a way that is meaningful, substantive, and responds to what consumers want.
Speaker 2 – Eric Dotson
Yeah, that’s a great question. I get asked all the time, when I talk about what I’m doing say, well, why do we need that if I already have Venmo?
Why would I do something else? And Venmo proves this is a solution that people want and they’re willing to go and use. And so now the financial institutions know this is good. This is what people want so they can go down this path, trusting that they’re going to have customers that that’s what they want. And what they need to do is put their touch on that the touch of I’m going to protect you. I’m going to protect your money. I’m going to protect your data. I’m going to do this in the right way so that if there is a problem, you can go to your trusted provider. And I’m going to help you with whatever problem you’re having.
I think they have to keep that in their mind that they were slow to pick it up because of this. But now it is their winning solution to go to market with a solution that they can then put forward to their customers and say I can do this, and I can provide you an added level of security and trust in this arena that maybe you can’t get. That’s where and I think there’s other things too. As far as your money stays in your account until you tell me to move it. It’s going to stay there, and then it’s going to move. And if you’re receiving something, when that money comes into your account, I’m going to hold that money for you. And it’s there for you. You could go, you know, pull it out whenever you need it. It’s not somewhere else that you have to then tell me. Hey, put it here so I can access it.
So, there’s a lot of different little angles. I think that the financial industry can be very successful. To be able to go to market and put forward solutions that their customers will be more than willing to pick up and start using and it’s been demonstrated in Zelle, you know that’s the big bank alternative to Venmo. Zelle has been very successful with their customers. So now this is where we come in. We’re trying to put forward a solution for any financial institution and allow them to be able to take it and offer it to their customers.
Speaker 1 – Lou Carlozo
Yes, PayMoli so that convergence platform really is a wonderful segue from the things that you have mentioned before. Where we stand with the industry, how financial institutions can change, adapt and prosper. Tell us about that platform, how it works and what the pain point is that you’re chasing after and solve.
Speaker 2 – Eric Dotson
Yeah, thanks. So, I appreciate you asking about that. So PayMoli is a great application and as you mentioned, we call it our mobile convergence platform. And the reason why we say that is, today PayMoli is a P2P application. That’s what it is. That’s what it does. It does it very effectively. It is offered by financial institutions and the payments actually ride on both the ACA and the debit card rails.
So, it provides you some avenues, some different alternatives for how you want to complete those transactions. But I say it’s the tip of the iceberg because there is so much more planned that’s coming as this evolves as customers begin to use it, you know we we’re on the cusp of real-time payments and FedNow and that certainly will be part of what we do with PayMoli and it’s really the on ramp for your consumers, right? It’s how do they access the capabilities of real time payment. Well, they need something in their hands that they can go and make that payment whenever, wherever, to whomever they need to in the moment so that they know that that transaction is coming.
But at Aptys we got our start by building a convergence platform for payment transactions. So, we process check, ACH and wire transactions today faster payments are coming. So, all of that on a single platform really reduces costs for our customers.
The mobile convergence platform has that same thought process behind it. How do we bring together all of the payment needs? So, if you need to be able to do wire transactions or ACH or whatever it be that can be in the palm of your hand using PayMoli, but today it’s peer-to-peer right? And it really simplifies things. One of the things that we put out there for our customers is that they can co-brand it with us so that it becomes PayMoli by ABC Community Bank. It shows their logo right there when the customer logs into the app. It’s there they know that this is from their financial institution, and it strengthens that bond, that relationship with their customers. So, we think that there’s a number of things that we help our customers with as they go to market with PayMoli and really sets the table for the things that are coming and the changes that are happening in payments today in the industry.
Speaker 1 – Lou Carlozo
And as we wind things up, when you look at the year ahead and you look at all of the different things going on, technologically speaking and with faster payments, FedNow, the P2P space, what are some things that get you really, really excited that you think we are going to see come to pass.
Speaker 2 – Eric Dotson
You know, it’s interesting just exactly what you’re saying, this acceleration into technology. The key to that is real-time payments through either RTP or FedNow. How do we get connected in there? How do we facilitate that? Not only the ability to process those payments in real time but get that connection all the way down to every financial institution and out to every end user.
And as we make that connection for those networks, you’re going to see a complete change in how I think business is done and how consumers expect payments and interactions with merchants and businesses is going to take place. I’m really excited about where things are headed, and I know that the industry is going to be different in five years and in 10 years and it’s just a matter of, hey, are we ready to embrace that change and hop on for the ride.
Speaker 1 – Lou Carlozo
Well, I’m ready to hop on with you, Eric. That is such an amazing overview. Your passion. Your vision, your focus, they’re all obvious. And I’m so glad you made the time to be on the podcast. Thank you. So.
Speaker 2 – Eric Dotson
Thanks, Lou. I appreciate it’s been fun.
Speaker 1 – Lou Carlozo
Eric Dotson is executive vice president, sales and the co-founder of Active Solutions. Be sure to look for Eric on LinkedIn.