For nearly 30 years, Early Warning has been at the forefront of developing financial technology solutions. Early Warning’s success can be traced back to its ability to excel in mitigating risk and establishing trust.

By partnering with well-established banks and credit unions, the company also gave rise to one of its most successful P2P solutions today: Zelle®. With roots going back three decades, Early Warning began as a specialty consumer reporting agency, helping financial institutions know the status of demand deposit accounts. Early Warning now looks to reimagine e-commerce and the consumer checkout experience again with the launch of Paze, a new digital wallet. In a recent PaymentsJournal podcast, Early Warning’s VP of Product Management, Robin Love,  Ryan Riveland, VP of Market Development at Early Warning, Paze’s VP of Product, Matt Miller, and Daniel Keyes, Senior Analyst of Merchant Services at Javelin Strategy & Research, dig into how the company has helped shape the financial industry and the profound impact Paze will make for banks and credit unions. Mitigating Fraud Is Key Establishing trust between consumers and financial institutions is important. As fraud attacks grow in scale and sophistication, it is essential that banks are able to balance fraud mitigation and risk. The same consumers who will be banking at the financial institution will also be using the Zelle and Paze solutions. “Early Warning offers a suite of services that are leveraged by thousands of institutions, agencies, and merchants across the country to help prevent not only synthetic identity fraud but mule detection, as well as the ability to determine if the applicant is like likely to commit first-party fraud or default on the account,” Love said. “From the best-practice perspective, I think they just need to have the right tools and their arsenal to ensure that they’re really identifying that this individual is who they say they are.” Zelle and Paze Have Their Distinctions It is important to note that Zelle and Paze are different products addressing entirely different sectors and use cases.

Zelle initially was launched to help small businesses that exclusively used cash and checks for their daily operations. Early Warning’s research discovered that 80% of small businesses surveyed did not accept cards as a form of payment. “Zelle is focused on digitizing check and cash, and that is not necessarily a Paze principle,” Riveland said. He added that Zelle was never intended for the purchase of goods but rather for P2P transactions and small-business services.  Furthermore, Zelle has been embedded within the mobile banking apps of participants in its network to boost consumer engagement within the apps. Paze, on the other hand, is a digital wallet that allows consumers to access their debit or credit card from all participating financial institutions in the network, offering a more convenient way to check out.

Miller explained that because the bank can already authenticate customers, there is no need for them to create another identity or download another app. On the merchant side, Paze leverages the relationship already established via the bank to provide a more enhanced front-end experience, eliminating the friction typically seen in online checkout. How Paze Aims to Change the Payments Industry Paze will allow consumers to use cards from Early Warning’s owner banks, including Bank of America, JP Morgan Chase, and Capital One, and leverage the digital wallet at checkout. It’s the long-awaited answer to what has become an accepted form of the checkout experience: customers manually keying in their financial data. “We think that’s one of the exciting things that Paze brings from Day 1,” Miller said. “It’s the scale of our participating financial institutions and the merchants that we bring onto the program, creating something that addresses that core need of e-commerce purchasing. “And ultimately does it in a way that is meaningful to consumers and brings them the experience that they should have had there all along.” According to Keyes, Paze can create a much more consistent experience that makes online shopping better.

“It’s more appealing and takes out a lot of friction from the process that is currently full of friction,” he said. Scaling Paze Paze is set to fully launch this fall and is anticipated to be a game-changer in the digital wallet space. Currently, Early Warning is partnering with large institutions that will help scale Paze much in the same way that Zelle has been able to scale for more than 2,000 financial institutions. The company is also working with a closed group of individuals to test and expand Paze for a full launch starting this fall and into the following year. The rollout will primarily focus on consumers who are actively shopping online. The goal is to also bring Paze to consumers and spotlight the security aspect, particularly as it’s supported by the many financial institutions those consumers know and trust. “It’s about finding the opportunity to reduce that key component of friction, which is establishing a new relationship with the consumer either in the form of guest checkout or in the form of account creation,” Miller said. What’s Next Paze is one of many solutions that are bringing banking, merchants, and consumers together, facilitating payments in the fastest, most efficient, and most secure manner possible.

With the help of its parent company, Early Warning, Paze can leverage decades of experience, a suite of services, and extensive banking relationships. Those resources will be pivotal to its scale and expansion. Access the On-demand Webinar - Power of the Network: Reimagining E-Commerce for Merchants with Banks and Credit Unions First Name (required) Last Name (required) Your Email (required) Company (required) Title (required) Δ

By PaymentsJournal
Oct 09, 2023 00:00
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