1. Could you provide us with a brief introduction to Hyperwallet, its services and the core problem that it tries to solve?
Peter Burridge: Hyperwallet is the world’s first purpose-built payments platform that empowers businesses to easily and cost effectively pay and support their global payees. Regardless of business model (sharing, collaborative, traditional), we enable businesses to cost-effectively and transparently distribute global and domestic earnings to their payees through a variety of payment methods. Our payments platform was designed to abstract all of the hard stuff associated with paying people—administrative hassle, compliance risk, distribution issues, and so on—off of our clients’ hands. Today, our payout platform gives more than 6 million payees the power to choose how they wish to track, manage and access their earnings every day.
2. How is Hyperwallet differentiating itself from other payout solutions providers?
PB: I believe that Hyperwallet is the only true outbound payments platform. While other payout solutions provide payout alternatives to banks, they tend to be very method-constrained or corridor-centric. Our platform affords flexibility across three integrated layers of modular functionality: (1) a redundant network of bank, card and cash settlement options across 170+ countries (2) an advanced administrative service dashboard, and (3) flexible API integrations.
As mentioned, our original software as a service payment solution was designed to abstract all of the hard stuff associated with businesses that need to pay people. Now, with our APIs, we are able to offer this same simplified approach to our clients through a single, streamlined integration. Depending on client preference, we can be entirely invisible to the payee; in fact, the payee never needs to leave the business’s own website.
3. What is your view of established players and their solutions in the payout solution space?
PB: Established payroll providers do one thing and they do it well: they enable payments from a company to its salaried employees, providing the necessary reporting and tax withholding capabilities at the same time. But companies that work with contractors don’t have the luxury of such a straightforward payout process. This is because businesses that use independent workers must abide by an entirely different set of reporting and compliance requirements. Couple that with the global nature of freelance work and the nature of Internet-enabled businesses. They can become global overnight, and they then need to pay thousands of people all over the world. In this environment, it’s easy to understand why traditional payroll simply doesn’t fit the bill in the new economy.
4. How are innovative technology companies providing better alternatives?
PB: I presume we’re still on the payroll thread. We aren’t focused on handling payments for full-time, salaried workers but rather servicing a different, rapidly growing population. In that sense, Hyperwallet’s platform is the independent economy’s payroll equivalent. Our technology offers an end-to-end payment service that allows contractor-driven businesses to pay their earners anywhere in the world, at any time, and for any amount. Like payroll systems, we offer the payor a ubiquitous solution that streamlines operations and simplifies their payment process, simplifying all the reporting and compliance considerations that are unique to compensating independent contractors. But what’s completely different is our focus on the payee’s needs: what the worker will need in order to successfully accept, manage, report and track their earnings. The new economy is all about choice and flexibility; workers are attracted to on-demand platforms because it gives them control of their career and a greater sense of freedom. What we’ve learned at Hyperwallet is that earnings are fundamentally connected to the attainment of this freedom. By innovating around the idea of self-directed earnings management and distribution, we’ve created a payout solution that doesn’t just help workers get paid faster and more cost-efficiently, but actually gives them the tools to be “successful startups of one.”
5. What is your expansion strategy? Is it geographic or are you looking at enhancing your product solutions into international payments?
PB: Our international network is already unparalleled in the industry. Building relationships with over 45 financial institutions around the world to offer low-cost local bank transfers (like ACH) and locally issued prepaid card solutions is hard. It’s simply not something that can be achieved overnight, regardless of resources banks are so risk averse today that you need to bring real volume to the relationship to make a risk/return argument. We will continue to expand our network this year with the addition of around 20 more countries added to our local bank deposit capability—taking the total to over 85, and we will be bringing on new prepaid card issuers to expand the number of currencies we can offer for local cards to 20.
Outside the network, the regulatory environment continues to require investment. This is really where our clients get value beyond what they may have initially been looking for. There was a time when a payment was indeed simply a payment. That’s no longer the case. It's now more about the data that travels with the payment and the rules in each country that must meet compliance. Is the business legal in the country they are making payments into? What data must follow the transaction to support the local regulatory environment? What scanning and screening of the transaction is required? What about withholding tax obligations? The list is endless and far beyond even the most sophisticated global companies to take on themselves.
But to return to the question—more countries, more options and more services to benefit the enterprise and their payees. More, more, more.
6. What do you consider the major challenges that Hyperwallet and other solution providers face in the international payments industry?
PB: Major challenges will continue to be related to the ever-changing compliance and regulatory landscape. This is a reality of the world we operate in and I think the entire industry needs to remain focused on stepping up to these challenges. Our job is to provide a payment dial-tone for our customers, and to that end, we need to always have redundancy built into our network. Bank policies change, and we have seen in the past that a bank can suddenly decide to stop banking MSBs, meaning we need to be able to redirect our volume. To address this, we will see more partnering and collaboration between banks and innovators. In my mind, such collaboration is great for the industry and should be encouraged.
There will come a day in the near future when you will need to know the identity of both parties while moving money electronically (no matter how small the amount). Global identity verification is still the biggest obstacle which the industry has to solve. You don't need to be a payments geek to know that—just travel through any international airport.
7. How has the overall ecosystem evolved in terms of international payout, and where do you see it moving to in the next two to three years?
PB: Good question! While there has been tremendous innovation and excitement on the “pay-in” side of the ecosystem with the Stripes, Braintrees and Ardens, etc. providing technology on top of the established networks of Visa and MasterCard, the disbursement/payout side is still very fragmented. We now have the universal acceptance of Visa/MasterCard for payment acceptance, then you fall off a cliff and must deal with local banks, their international correspondent partners and the range of other local/regional settlement options. Inbound is a universal plug, and outbound is a bag of adapters.
This situation is great for businesses like Hyperwallet—it makes us very relevant. We’ve been quietly building our global network as I mentioned earlier, having recently added the integration layer that now turns payouts into a universal plug similar to what exists for a “pay-in.” With our expanded REST API suite, our clients can now call our services directly into their platform, and our services take care of everything from that point on; we provide the payee choice, validate their instructions, perform all the necessary compliance checks in a non-intrusive way and deliver their payments with tracking similar to the Fedex model. All in 170 countries…. Ask anyone, this is a real achievement.