Digital Transactions Authoritative, insightful and timely information for payments professionals
As account-to-account payments raise their profile in the payments arena, Dwolla Inc. has launched Dwolla Connect to enable businesses to integrate the payments into their apps and connect with existing cash-management systems. One of its chief utilities is enabling a centralized location for payment information.
Announced Tuesday, Dwolla Connect provides companies such as those in financial services, lending, banking-as-a-service, insurance, and marketplaces with an API—a piece of code that can be integrated into their systems—to use with their existing commercial accounts at many big U.S. banks to initiate payments. The service can eliminate having to make such payments in batches, a more traditional option, Dwolla says.
Targeting mid- to enterprise-sized organizations, Dwolla says Connect clients do not need a dedicated digital wallet because they can use their existing bank accounts. Dwolla Balance is the company’s digital wallet for businesses.
One use case is e-commerce, where businesses can automate their payment processing and provide a smoother checkout experience. Another is transit payments.
Until recently, account-to-account payments growth has been driven by business users, but now the onset of real-time payments networks has sparked interest in the transfers for both business and consumer accounts. The growth of open-banking networks, which can validate account balances quickly, has helped drive growth. Global volume for such payments totaled $525 billion last year, up 13% from 2021, according to statistics from the big processor Worldpay. The company projects these payments will account for 10% of e-commerce payments volume by 2026.
Currently, JPMorgan Chase & Co. and Wells Fargo & Co. offer Dwolla Connect services, though Des Moines, Iowa-based Dwolla intends to expand the banking network over the next 12 months.
