One of the unique traits of the current fin-tech surge is the historical approach platforms take as they prepare for market launch.
It used to be that companies completed a long list of to-dos before going live. Develop the product, test, get feedback and refine. Sometimes several times.
That method is becoming less common as companies hurry to establish themselves before clear favorites emerge. Time counts in this competitive climate so platforms have grown comfortable with debuting a basic viable product and iterating on the fly.
Pin4’s approach was the exact opposite, and for good reason, CEO Rich Witkowski said.
The Pin4 Cardless Cash Network is America’s first platform where consumers can receive real-time cash at enabled ATMs without a debit card, credit card, or bank account. It employs a dual-PIN authentication where two sets of unique single-use codes are texted to the recipient.
Pin4’s technology is not new, Mr. Witkowski said. Developed six years ago by HalCash and licensed to companies in different markets, it has been successfully deployed on three continents. So they know it works.
The wait was to ensure patent protection, which finally came in May 2015.
Pin4’s initial rollout occurred in New York, Chicago, Miami and Los Angeles, with plans to be nationwide on Payment Alliance’s 70,000 ATM network by July, Mr. Witkowski said.
Those cities were not chosen by accident. They are home to many people who need to send money to or receive it from family in other countries. Pin4 enables that through a partnership with Viamericas, a person-to-person money transfer company.
Pin4’s benefits extend to business and governments, Mr. Witkowski said. Companies who issue rebates and rewards see increased efficiency through the elimination of cards and checks which have to be mailed. Companies use the instant gratification to engage with customers and increase brand loyalty. In Poland, Nikon sends rebates via HalCash orders to camera buyers.
That is much better than companies sending gift cards, because they have no idea how many are eventually redeemed, Mr. Witkowski added.
“There’s no breakage. The biggest economic benefit is you can cancel the message after 90 days if the money doesn’t move.”
Insurance companies are also using Pin4 technology to encourage behaviors which reduce their overall costs, Mr. Witkowski said. People with diabetes can be sent money for taking glucose readings and the insurers will know when every dollar is accessed. One insurer he knows spends $50 million annually on gift cards, only to see 40 percent of them go unredeemed.
Governments also issue regular payments to people including social assistance stipends for clothing and transportation. Since many people with lower incomes are unbanked but do have mobile phones, they can be texted with a message to withdraw the funds at a nearby ATM.
Pin4’s system is also secure, Mr. Witkowski said. Both PIN codes arrive via separate data streams which originate at different locations.
“Not only is it a frictionless way to get cash but it is also more secured.”