CX Innovators: Central Payments Powers Next-Gen CX with Choice

Central Payments wants to offer more than a traditional issuing bank.

Propelled by their own rapid expansion over the last six years, the Dell Rapids, S.D.-based prepaid issuer is helping fintech partners get to market faster and with more options.

The key ingredient is OpenCP, their open API platform.

The banking-as-a-service technology hub connects all the players in the payments ecosystem needed to launch a product—network, processor, identity verification, card manufacturer, customer support, etc. Importantly, according to Central Payments Founder and President Trent Sorbe, their partners can easily plug into multiple vendors.

“We’ve done all the hunting and pecking and integrations with best-in-class providers,” says Trent. “Not only do we bring our compliance infrastructure and our expertise around product development, but we also provide a charter and a choice.”

Trent Sorbe

It’s a faster route to market. Central Payments partners don’t have to secure relationships for all the services they need and then seek bank approval of vendors, which can divert precious resources away from a product launch and add months to the timeline.

Instead, partners can choose from multiple vendors, like Ubiquity, and plug right into their systems through OpenCP. At the same time, choosing Central Payments doesn’t lock partners into a specific vendor for each function, which, Trent says, is by design.

Collaboration for the Customer Is King

Similarly, Central Payments puts a premium on choice when partners are designing their customer journey.

“We want to leave the customer experience as open and fluid as possible to see what gains traction,” explains Trent. “Sometimes that can be hard as the bank involved in the process, but we’re committed to innovation and championing new approaches to providing financial services.”

To that end, Central Payments works collaboratively with clients within the bank’s robust compliance framework. “We’re scrutinized pretty heavily, and we’ve come through that with a lot of confidence. If financial services is a road, we keep you from going into the ditch, but we let you change lanes. To be a good partner requires constructive criticism and creativity. We’re not here just to say no. But, we also expect our partners to be flexible as well.”

Last fall, after celebrating five years since their own debut, Central Payments decided to further their commitment to innovation by launching Falls Fintech. The fintech accelerator welcomed its first cohort of companies this spring, albeit slightly differently than planned (see sidebar).

On-Demand Financial Services

Young companies aren’t the only ones attracted to Central Payments’ collaborative approach and entrepreneurial spirit. Ceridian, a global human capital management software company and long-time payroll card provider, partnered with Central Payments to rollout their on-demand pay solution in May.

The Dayforce Wallet app enables employees to request a payout of their earnings whenever they need it at no direct cost to them or their employers. Central Payments issues the companion prepaid Mastercard and helped Ceridian launch the program via the OpenCP platform.

Companies have to look for new ways to help their financial services customers, Trent adds. Not everyone can follow Ceridian’s on-demand pay approach, which leverages the company’s vast network of employer relationships and decades of payroll experience. However, to usher in the next generation of CX, you have to be able to give customers what they need before they ask for it. “A simple SMS balance alert, that’s a given,” Trent explains. “You should be able to say to your customer, ‘We know you’re expecting a direct deposit on Friday, do you want to use it to pay this bill that’s coming due?

“Use your AI, self-service and predictive tools not really to focus on cost mitigation so much as to minimize the burden for your customer,” he continues. “Don’t make them hunt for answers. Make sure answers are readily available.”

That can be even more challenging in the midst of unprecedented disruption brought on by a global pandemic. But it’s one that fintech, which is adaptive by nature, is poised to deliver on, Trent suggests.

“We’re clearly seeing companies thinking about the financial experience beyond the transaction, beyond saving. Thinking about investments and insurance—putting them all together. When you can do that in a way that helps improve the customer’s financial well-being, that’s what gets us really excited.”

Falls Fintech Spring 2020 at a Glance

Central Payments’ fintech accelerator Falls Fintech kicked off on March 9. After one week onsite in South Dakota, the bank pivoted to a virtual environment in the face of COVID-19. Over the course of 12 weeks, the startups below gained insights, connections and an investment from the bank to support their vision and growth. As one of the only accelerators in the nation founded by a full-scale digital payments bank, Falls Fintech participants come out of the accelerator with a bank partnership and access to open APIs, making their market launch nearly turn-key. The 2020 spring cohort included:

Build Financial (New York): Empowering middle-class users by providing them with emergency savings, spending and financial health tools, Build Financial’s core financial products (high-yield savings, mobile banking, debt consolidation, long-term investing) utilize automation and learning tools to help customers take control of their money and make saving it automatic, accelerated, affordable and accessible.

Invest Sou Sou (Washington D.C.): Inspired by African and Caribbean cultures of building wealth together, Sou Sou is a smart social banking app designed for customers to save, build credit and invest with people they trust. Created to help customers build a stronger financial lifestyle, track saving progress, unlock rewards and build credit. Together.

Permiso (California): Revolutionizing banking for youth, Permiso created an app, card and life literacy curriculum that keeps users actively engaged. Permiso combines socio-emotional life principles with practiced executive functioning and financial literacy skills, making it not only an app to check your bank balance, but to learn about how to succeed in school and life.

Soon (Utah): Simplifying finances by consolidating checking, saving, investing and goals into a person’s existing cash flow, Soon’s Smart Debit Card automatically invests when a customer makes a deposit and divests the best-performing asset when money is spent to increase purchasing power, deliver investment-level returns and help users accomplish important life goals.

XpenseOne (Washington): A digital expense management solution developed for small and medium-sized businesses to streamline processes related to expense reports, approval workflows and back-office reconciliation. The XpenseOne solution is white-labeled and offered by banks to their business customers, driving higher retention, revenue and customer acquisition. Businesses can manage expenses made with any payment method such as personal cards, bank-issued cards or cash.

Applications for the next cohort of Falls Fintech are being accepted through June 30, 2020.