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Choose Payments Partners Wisely

April 11, 2023

The recent unexpected and speedy failure of Silicon Valley Bank injected even more uncertainty into what the future holds. But it also provides an important lesson on the dangers of creating single points of failure.

Companies that held all their deposits and assets at the bank as well as the bank’s own overexposure to one industry in particular both shine a spotlight on the need for safer paths to scale. This is a critical lesson for payments industry leaders trying to activate growth strategies for the remainder of 2023.

It’s clear that payments will play a critical role for adjacent industries this year. Sectors like gaming and real estate are adding in financial services layers to their core product experiences using embedded finance solutions — think instant payouts, insurance and buy now, pay later (BNPL) options to enhance their customer experiences.

Chief among these layers is embedded payments or embedded instant. Consumers expect instant money movement into and out of all their accounts, safely and at the press of a button. Whether they are opening a new account, sending money to a friend or collecting a payout on a sports bet — they expect brands in every industry to deliver on the promise of money mobility. And they will vote with their wallets if their expectations are not met.

Real-time payments then are no longer a luxury or an option. Brands must deliver on the promise of instant money now or risk losing both current and potential customers.

For companies seeking to add a layer of embedded instant to their core product experience, the lesson of Silicon Valley Bank should ring loud and clear. When dealing with payments, risk management foundations matter and functional connectivity from the lowest price enabler isn’t always the best longterm option.

Companies handling significant payment volume have serious sums of money and equity at stake. Confidence and security comes from working with experienced, time-tested partners with diversified DNA.

In particular, search for partners that exhibit superior network reach, compliance expertise, risk and fraud tools and customer support capabilities. And do your homework — look for those that have longevity in the industry, with a blue-chip client roster, whose team has a deep history in the sector, and that have willing client references. Without these, companies are taking on unnecessary risk for a crucial, client-facing aspect of their business.

Because the reality is that payments are never 100% guaranteed — there are too many elements in the process that can go wrong, and often for a good reason. Relying on the easy path to embedded instant payment will turn a failed one-time payment into a lost customer. While a partner with experience that has redundancy in its systems and that is willing to engage in real time to troubleshoot solutions will turn a failed payment into a customer-saving experience.

As payments leaders search for partners to help them stand out in a rapidly evolving and crowded field, they would be wise to choose the safe path to scale in 2023.

Drew Edwards
CEO at Ingo Money