Banked, a Payment Startup, Looks to Boost Pay-by-Bank in the US, Says Founder

The partnership between Banked and FIS represents a significant step towards revolutionizing payment methods in the United States. By introducing new pay-by-bank offerings, the collaboration seeks to simplify transactions for both consumers and businesses, streamlining the payment process and enhancing overall convenience.

With Banked's expertise in online payments and the backing of Bank of America, coupled with FIS's financial technology solutions, the partnership is well-positioned to drive innovation in the US payment landscape. The ability to conduct direct transactions between bank accounts without the need for traditional payment details promises to offer greater efficiency and security to users.

By eliminating the reliance on card details, account numbers, or sort codes, pay-by-bank solutions reduce the risk of fraud and enhance the overall payment experience. This approach aligns with the growing trend towards digital payments and underscores the importance of providing users with convenient and secure payment options.

Overall, the collaboration between Banked and FIS represents a significant opportunity to modernize payment infrastructure in the United States, paving the way for a more seamless and efficient payment ecosystem.

Advocates of pay-by-bank argue that it offers several advantages, including reduced fraud, faster settlements, and lower processing fees for businesses, as well as a smoother payment experience and faster access to funds for consumers. Despite the dominance of cards in both in-store and online transactions, Banked's founder, Brad Goodall, believes that pay-by-bank can gain significant market share in the US, particularly by digitizing processes like cheque payments, which can be time-consuming and inefficient.

One of the key attractions for merchants is the potential cost savings, especially in a market with high interchange fees. Goodall emphasizes that pay-by-bank is not about replacing cards but rather offering more choice to consumers and businesses. By integrating pay-by-bank solutions with existing card payment systems, Banked aims to provide a seamless payment experience while incentivizing customers with cash back or loyalty points.

Indeed, overcoming the lack of public awareness is a crucial hurdle for the widespread adoption of pay-by-bank solutions in the US market. The report by PYMNTS Intelligence and AWS underscores the significance of educating consumers about the benefits of account-to-account payments to drive adoption.

To address this challenge, it will be essential for companies like Banked and FIS to launch comprehensive awareness campaigns highlighting the advantages of pay-by-bank transactions. These campaigns could include targeted marketing efforts, informational materials, and partnerships with financial institutions and retailers to promote the convenience, security, and cost-effectiveness of account-to-account payments.

Additionally, user-friendly interfaces and seamless integration with existing payment platforms can help streamline the adoption process and encourage consumers to embrace this new payment method. By providing clear and transparent information about how pay-by-bank works and its benefits compared to traditional payment methods, companies can gradually increase public awareness and foster trust in account-to-account payments.