“As private as cash, as safe as a card”
Cross River Bank announced last week that it will provide core banking infrastructure and payments capabilities for PayTile, a startup that offers location-based payments through its app. PayTile is one of the first P2P payments platforms that uses geolocation to enable private financial transactions between users without the need to share any personal information.
The PayTile app provides an alternative digital payment option in situations that generally require physical cash, such as tipping the valet or shopping at the farmers market. The firm says its offering is similar to Apple’s AirDrop functionality: users can send money to people nearby without having to share their username, legal name, email, or phone number with the recipients.
As Cross River becomes PayTile’s banking partner, PayTile users will be able to send and receive money through mobile wallets powered by Cross River. They will use Cross River’s infrastructure and payments capabilities such as ACH to fund their PayTile wallets, and push-to-card to move funds digitally.
Anu Vora, PayTile’s founder and CEO, says that with growing privacy concerns in an increasingly cashless world, PayTile’s P2P product helps protect users’ personal information during digital transactions.
“PayTile’s mission is to make digital payments as private as cash and as safe as a card,” said Vora. “While traditional P2P apps exist to pay the people you already know, PayTile exists to safely pay people you don’t know. We’ve built AirDrop for money and we're making transactions safer for everyone.”
PayTile is also launching Money Drop, its proprietary technology that takes the app beyond P2P payments. This offering allows users to virtually place money or digital goods at an exact location for other users to “pick up” and redeem later, without the need for any physical hardware.
For businesses, PayTile says it offers the ability to build gamified experiences with Money Drop. Companies can use it to draw physical crowds at specific locations and offer rewards and incentives to strengthen customer engagement, for example by selling discounted tickets at a stadium or offering coupons at the opening of a brick-and-mortar establishment.
Cross River Bank closed out 2021 by announcing collaborations with two other payments firms: San Francisco-based Astra and Austin-based Payment Approved. With Astra, Cross River launched a card-to-card instant payment API. And with Payment Approved, Cross River is providing the infrastructure to support payments through its push-to-card capabilities on both the Visa and Mastercard networks.
What Apple's pact with Stripe means for the point of sale
Stripe’s back in the headlines with another tech giant. Apple’s long-awaited foray into contactless payment acceptance will soon go live with Stripe as an initial distribution partner, expanding the market for downloadable checkout technology.
The new system, which Apple announced this Tuesday, will allow consumers to make payments by tapping a contactless card or mobile wallet against a merchant’s iPhone. The merchant would still require a payment acceptance app of some sort, but would no longer need a plug-in or Bluetooth card reader.
Stripe is the first announced merchant service provider to support Tap to Pay on iPhone, enabling the service for business customers and the Shopify Point of Sale app this spring. Apple’s release only mentioned iPhones, though the technology could theoretically be applied to other Apple devices.
Apple doesn’t appear to be acting as a direct merchant acquirer, with Stripe playing that role in the initial deployment. “In collaboration with payment platforms, app developers and payment networks, we’re making it easier than ever for businesses of all sizes, from solopreneurs to large retailers, to seamlessly accept contactless payments,” said Jennifer Bailey, vice president of Apple Pay and Apple Wallet, in a release.
Apple Pay has over 500 million global users, and it controls about 92% of the US mobile wallet payments market. Around 90% of merchants in the US accept Apple Pay, according to the firm.
Sam Shawki, CEO of contactless payments technology firm MagicCube, says that while Apple devices aren't universally used and may be too expensive for merchants in some markets, the Apple announcement creates more momentum for “downloadable” payment acceptance from Android and other operating systems.
“This means cloud-based tech is coming for payments,” said Shawki. “People like to say this announcement is about Apple versus Square. But it’s really about software versus hardware.”
Highlights from our recent coverage
Behind the mismatch between consumers’ payment preferences and their actual experiences
Consumers are embracing the move to digital, with 74% saying they prefer to make payments digitally. When it comes to receiving disbursements from firms, American consumers report speed, choice, and convenience as top factors.
Should we take the crypto paycheck seriously?
Cryptocurrency payroll is gaining popularity among employers and employees alike. This week, we explore the viability of the crypto paycheck.
It’s really expensive to build a new core: Fiserv acquires Finxact
Fiserv is acquiring upstart cloud native core banking software provider, Finxact. Fiserv now has the capabilities to bring its clients into the future with API connectivity and personalization capabilities.
What we’re reading
- Mastercard wants to use digital payments to fight against single-use plastic (Finextra)
- Almost half a trillion dollars sent by consumers and businesses with Zelle last year (Crowdfund Insider)
- Early Square merchants using Afterpay see a 20% lift in size of sales (Finextra)
- Inside the usage trends of new crypto-backed cards (Business Wire)
- Save partners with Visa to release a new high-yield credit card (ZDNet)