Peer-to-Peer Payments

In the not too distant future, P2P will become the primary vehicle for individuals to exchange value between each other—further displacing cash, checks and, perhaps, even card-based transactions. In this commentary on P2P, Galileo CEO Clay Wilkes makes the case for making the best P2P decisions for customers and your business, because P2P isn’t just about splitting lunch tabs. It’s the future of personal payments.

Other than swiping my card or, maybe, dipping it or tapping my phone, P2P is the service I use most--and not just because I have a large family. I use it because it's ultra convenient.

If you're talking to a younger audience—Venmo is the white hot P2P service of choice. Not too long from now, you may be able to add Square Cash, Apple, Google and even Zelle, a consortium of financial institutions, to the hot P2P provider list. And, undoubtedly there will be more entrants into a P2P market that’s becoming crowded with marquee tech names.

P2P is hot because it’s what consumers want. That applies to the mobile-obsessed, super social millennials who need a convenient way to split the cost of meals, rent and entertainment. It also applies to the less-talked-about Gen Zers and even younger Baby Boomers, both of whom find P2P a great way to transfer money to their kids or significant others. In other words, P2P is table stakes for any transactional financial service, regardless of the audience.

But table stakes doesn’t mean P2P services are fungible. While the basic functionality is the same—that is, funds move from one point to another, typically between individuals—there are significant differences in how and when money moves behind the scenes. And, those background differences affect service benefits, like how fast individuals get or receive their funds and for the P2P service provider whether the funds stay within your product walls.

My point is, when considering incorporating (or upgrading) P2P into a financial service, if you’re only asking whether your provider supports P2P (that is, you’re checking the box), you haven’t dug deep enough. If you expect to go head to head with the big boys in P2P (more about them in a moment), you need to understand the entire consumer experience you’re offering and how the particular variation of P2P you’re exploring affects your internal operation and, perhaps, even your balance sheet.

Now, let’s talk about those big boys of P2P. The techs have a cache that’s a bit rebellious or—although I hate to use this word—hip (My father uses banks, not me!). And, they have a head start in positioning themselves as the go-to provider for P2P. You know what I mean: PayPal and Venmo now are not only proper nouns; they’re verbs, as in “PayPal me.” or “Venmo me.”

But, what if:

• Your P2P service competed head to head with the doyennes of P2P?

• You could create a P2P service with features and functionality especially suited to your target audience?

• You didn’t have to surrender P2P to a third party and you could keep more transactions within your domain?

• You could position your business for the not-too-distant day when P2P is the primary way individuals exchange funds?

Working with Galileo, you can accomplish all of these goals or any combination that works best for you. We can enable you to power P2P transactions, create targeted products, integrate your products into social media and/or provide a gateway to the big P2P tech services.

We can do this because we’ve been supporting P2P for 15 years, and today we’re the processor for millions of P2P transactions each month—so we’re tested and proven.

The secret to our ability to deliver any P2P variation our clients can envision rests on two key factors: (1) our flexible account hierarchy that establishes the relationship between accounts and cards (even virtual cards) and (2) our robust APIs. On top of those, our analytics are unsurpassed, so P2P can be a strategic investment—not just something you offer to match the competition. Some people tell me P2P is a checkbox service. I don’t agree.

Financial services today is so competitive that everything counts. Every little thing. And, those who are thinking about P2P as a gimmick to enable millennials to split a lunch bill are missing the point that P2P is the conduit for what comes next in consumer payments. When you can offer your customers the service that works best for them and positions you for the changes ahead, isn’t it worth your time to think about P2P as your next strategic imperative? We look forward to working with you to unleash your creativity.

Galileo: We are fintechs’ tech!