Early Warning® has been at the forefront of developing financial technology solutions for more than three decades. 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 the most successful P2P payment solutions today: Zelle®.
Early Warning began as a specialty consumer reporting agency, helping financial institutions know the status of demand deposit accounts and now looks to reimagine e-commerce and the consumer checkout experience again with the launch of PazeSM, 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 have on banks and credit unions.
Establishing trust between consumers and financial institutions is essential
As challenges in the financial realm evolve, banks and credit unions must balance risk management and customer support using advanced identity and payment risk tools.
“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 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 in their arsenal to ensure that they’re really identifying that this individual is who they say they are.”
Zelle® and Paze Have Their Distinctions
Zelle® and Paze are notably different products addressing entirely different sectors and use cases. Zelle® supports a use case that helps small businesses that exclusively used cash and checks for their daily operations. Zelle® was made available to eligible small businesses as a result of research conducted by Early Warning which revealed 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® is embedded within the mobile banking apps of participants in the network to boost consumer engagement within the apps.
Paze, on the other hand, is an easy-to-use digital wallet that consumers can use for e-commerce purchases. Because Paze is offered by banks and credit unions, consumers can access their debit and credit cards from all participating financial institutions in the network. 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 is set to launch to all eligible consumers in 2024 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.
Paze is launching in 2023 to a limited consumer population ahead of general availability. 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 count on.
“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.
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 is bringing banking, merchants, and consumers together, facilitating fast, efficient, and secure payments. With the help of its parent company, Early Warning, Paze leverages decades of experience, a suite of services, and extensive banking relationships. Those resources will be pivotal to its scale and expansion.
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