Paying bills sucks as a business and individual, especially if you don’t have a good system for ensuring money goes in and out at the right time. One of the golden rules of financial health is that cash flow is king, and if you don’t have it, you might be paying for it.
The good news is that new financial technology, Banking as a Service (BaaS), and payment processing providers have been entering the scene to help individuals and enterprises organize their bills.
Enter Hank Payments, the only North American cash and liability payments processing platform that automates bill and debt payments. Hank is on a mission to help consumers and businesses reduce liabilities earlier, improve cash flow, and increase financial security. With a high margin model, recurring usage revenue where every user pays fees, Hank has served well over 100,000 consumers. Hank’s on a path you don’t want to miss.
To most people, BaaS is a type of fish, not one of the most transformative technological developments to hit financial services since the debit card. By 2030, BaaS or Banking as a Service is set to become a $7 trillion industry.
If you’re still wondering what BaaS is, you’re not alone. Put simply, BaaS is a fee-based model where fintechs team up with banks to integrate financial services into the products of other non-bank businesses. Through BaaS, non-banks like airlines or auto dealers can provide customers with digital banking and payment processing services with only a few lines of code, instead of a banking license.
To date, most of the BaaS action has been happening in Europe, but BaaS is growing and growing fast. As BaaS grows and access to financial services becomes more available, intelligent orchestration of payments and cash management is becoming particularly important.
The more access to money you may have, the more bills you may have. The more bills you have, the smarter you need to be about ensuring they get paid on time without putting you in a place where you don’t have enough funds to settle.
With all this access to money, debt management takes center stage, especially when consumers have quicker access to their cash than ever before through payroll advances and are tempted by “Buy Now, Pay Later”. You don’t want to start dipping into your payroll before pay day!
Despite the economy being on the perpetual brink, people continue to spend money. That’s why more businesses and institutions that offer products on financial wellness would be smart to make it easy for them to pay those debts back hassle-free.
The inner workings of payment processing and Banking as a Service might sound complicated, but Hank Payments is making it simple. Their proprietary technology automates and facilitates the flow of cash between a consumer’s or enterprise customer’s bank, ensuring more frequent smaller payments build up until cash balances allow the next cycles bills to be paid. Incidentally, Hank builds deposits for Banks as part of this process, and we all know how important that is!
Hank’s payments orchestration facilitates all types of payments, including credit cards, mortgages, auto loans, insurance, and many others, in a secure, reliable, and efficient way.
That’s not all, though…
It also aggregates and monitors all the data hitting its platform through real-time transaction monitoring, fraud detection, and integrations with other tools, banks and software.
Hank analyzes a consumer’s cash flow, automatically determines how much cash must be built up and set aside, to pay out upcoming obligations and when balances are built up, Hank pays everything automatically. This means more cash flow through interest savings that can be used to accelerate debt payoffs, ensure less missed payments (NSFs), faster equity building for homes, vehicle purchases and other benefits.
Busy people need Hank to help manage all their liabilities conveniently while sub-prime customers use Hank to improve their financial track record, making lower cost borrowing more accessible over time.
The best part, though, is that Hank takes zero balance sheet risk for facilitating these transactions. Everything Hank does is fee-based, recurring revenue taken off the volume of dollars traveling through Hank’s infrastructure. The result? A ~90% margin business growing 22% YoY with over 42,000 paying users and over $1B in payments made since 2018.
Until now, Hank has been a trusted partner to auto dealers by helping consumers avoid loan delinquencies, and dealers improve the financial efficiency of their inventory. That’s about to change, though. Hank has their eyes on a new multibillion-dollar market.
Hank stands out as the only North American BaaS platform that automates consumer cash and liability management, so the average person doesn’t get into trouble when trying to pay their bills or pay down debt.
It only makes sense that Hank’s next big play is in the U.S higher education market that’s created over $1.74 trillion of student debt that needs to be paid down.
At 5,300 higher education institutions, 18M students, and $37,787 in debt per student, Hank has a massive opportunity to help students save for tuition, defer their tuition, and pay tuition effectively.
In fact, the company already has over 100 schools in its sales pipeline and estimates each one of those schools could generate between $100,000 – $2,000,000 in revenue annually. Since most of this market is fragmented or home to archaic campus management software and student loan servicing companies, Hank’s got a real shot to do well while doing good. To top it off, the university makes Hank part of their payments ecosystem, so individual user acquisition cost is moot once the university signs on and brings the students to the table.
This orchestration of debt payments improves the balance sheets of schools, keeps them on side with regulators and ensures students optimize their own cash flow.
In addition to entering the U.S Education space, Hank is also making strides in white-labeling its platform in Canada having just signed a $5.0 MM enterprise licensing agreement. This licensing strategy is a key aspect of its high-growth, high-margin and low CAC business model. Things are off to the races.
Hank’s got what it takes to make it right to the bank.
If there are two things Hank Payments and Hank Aaron have in common, it’s the ability to hit a home run, and it’s not even the 3rd inning.
Backed by a team of seasoned software and financial services leaders who together, have raised over $1B across their 120 + years of collective experience, you don’t want to be watching from the cheap seats.
Near-term catalysts include the full rollout of Hank’s educational payments products suite in the U.S., additional platform white label opportunities, new banking and fintech partnerships, and the buildout of the company’s data monetization strategy.
Talk about making payment processing simple and hassle-free!
Learn more about Hank Payments here!
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