April 13, 2023
Announcing Instant Payouts on Plaid Transfer
As the world becomes increasingly digital, consumers expect real-time, on-demand experiences. This is particularly true when it comes to payments – people want to be able to receive their money quickly and easily, without having to wait days - even minutes. At Plaid, we believe that you should be able to access your money when and where you need it. More importantly, the experience should not come at a steep cost.
This is why we built Instant Payouts – a real-time, multi-rail payout solution to send funds instantly, 24/7 within our Transfer product.
Access to money when and where you need it
In today’s world, nearly everything is instant, and on demand. If you need a ride, you order it on demand. Need to buy a flight? Download the airline app and book your next trip - all in a matter of minutes, if not seconds. Real-time is the winning strategy in almost every industry.
But what about bank payments? The standard payment method in the United States is what is known as ACH - Automated Clearing House - and valued for its ubiquity, flexibility and cost-effectiveness, but not always for its speed. It moves money during banking hours and can take several days for settlement. This challenge - plus the complexity of managing return rates - is why we built Signal, to unlock Instant ACH for direct debit transactions.
However, payouts that take days to settle can be a major disruption to anyone's financial well-being - both consumers and businesses alike. Imagine the gig worker that has decided to pick up additional work and needs to wait days to receive their hard-earned money. Even if there is an instant option, they have to typically connect a debit card and pay a 0.5% to 3% premium. With the current economic uncertainty and bank volatility, people deserve their cash when and where they need it.
Real-Time Payments (RTP®) on Plaid Transfer
Transfer is our flexible platform to manage bank-linked transfers and payments. You can authorize customers securely, analyze risk, and move money - all within a single API. With Instant Payouts, our Transfer product now offers RTP in addition to ACH as a potential processing rail.
While ACH is ubiquitous for 100% of US bank accounts, RTP is compatible with between 60-70% of accounts. It really depends on how you slice it. To manage this complexity across accounts and rails, our Instant Payout solution provides intelligence on RTP eligibility. If the account is not eligible, our customers can seamlessly route the transaction to ACH (Same Day or Standard) without sacrificing the customer experience.
How it works:
We are supporting a variety of businesses and verticals like personal lending, marketplaces, insurance, brokerages and digital investment platforms - all using Instant Payouts to enable immediate access to money, for their customers.
Let’s dive into a real-world example with one of our early adopters, MyBrandForce. MyBrandForce is disrupting the retail execution space by connecting innovative brands with the power of an on-demand workforce. We are partnering with MyBrandForce on Instant Payouts to ensure their trained Brand Agents can receive their hard-earned wages on demand, in real-time.
Link the account and check for eligibility: Prior to the payout experience, the Brand Agent onboards to the platform and links their bank account with Plaid to receive future earned wages. At this time, Mybrandforce can confirm if the linked account is eligible for RTP. If yes, the Brand Agent is eligible for Instant Payouts.
Elect Amount to Payout: In this example, the Brand agent has $71.00 in earned wages available for Instant Payout. They agree to initiate the payout of $71.00.
Payout Initiated: The consumer is immediately prompted that the Instant Payout has been initiated.
Instant Payout Received: Within seconds, the funds are received within their bank account.
Their platform allows brands of all sizes to perform scalable field services and acquire real-time observational data from trained Brand Agents across the country. The ability for their Brand Agents to receive their funds in real-time differentiates them from other gig platforms where Instant Payouts often come at a price.
We are honored to innovate and build the future of bank payments with our partners and customers like MyBrandForce.
With Instant Payouts, your customer can receive their recently approved loan, hard-earned wages, or their insurance payout - within seconds. The experience drives differentiated value and increased customer loyalty with payments moving 24/7/365 when using the Real-Time Payment (RTP®) Network. When there is a true need for liquidity, the ability to receive much needed funds in seconds is possibly the most valuable distinction.
Reach out if you want to get started on your road to real time payments.