Instant Mobile Funding: How combining payments and digital capabilities will transform the lending industry 

[Editor’s note: This is a blog post from Wirecard. Wirecard is a bronze sponsor at LendIt Fintech USA 2019, which will take place on April 8-9 in San Francisco.]

As technology continues to evolve rapidly, competition for customers depends on the ability to deliver convenience and speed at every touchpoint. Loyalty and customer service have a huge impact on every aspect of a business – the lending business is no exception.

More and more, loyalty and customer service depend largely on speed, convenience, and a seamless experience across all channels. In Wirecard’s own Consumer Insights surveys, we found that 26 percent of participants regularly use mobile payments, and 62 percent cite convenience as a primary motivation for making online and mobile transactions.

The allure of speed, efficiency, and convenience is equally strong on the other side of the transaction. According to the American Bankers Association’s Digital Lending Report:

  • 31% of banks surveyed expressed interest in partnering with third-party providers to originate and service consumer loans
  • 80% showed interest in leveraging technology in their small-business loans activity
  • 72% want to become more efficient in their lending services

Lenders face an incredible opportunity to harness digital capabilities to optimize their customers’ experience and support their business by combining forces with payments providers.

It’s easy to imagine scenarios that, when combined with consumer and small business affinity for the speed and convenience of digital payment options, are an excellent fit for real-time digital lending: The end user who finds themselves in circumstances – a medical emergency, a sudden car repair, a broken piece of equipment – that requires funds beyond emergency savings or their current bank balance. An instant digital lending solution – offering real-time access to funds – can make a huge difference in these cases.

Instant digital lending can be a particular boon for small business. According to reports on one U.S. Bank study, 82 percent of small businesses fail because of cash flow problems, and more than a third say cash flow is a major challenge to running their business. In another survey, 80 percent of merchants said that real-time payments would increase their available cash flow. Instant digital lending is an excellent vehicle for providing short-term financing that can solve this kind of problem.

Adding immediate funds availability to a short-term lending product can also help small businesses pay for equipment upgrades, hire seasonal or project-based help, and respond to unexpectedly high demand – activities that help businesses move toward growth. Simply, instant payment can be the key to helping a small business go from survival mode to thriving.

For all its benefits to borrowers, instant payment offers as many benefits to the lender: faster spend for the borrower means faster interest generation for the lender. It’s also safer, more cost-effective, and more efficient all around. Issuing a check can cost anywhere between $4 and $20, while ACH and real-time payments typically cost $1 or less to issue – a significant and immediate cost savings.

Meanwhile, real-time payments are becoming not only easier but also different enough from payments that are simply fast – such as an ACH deposit that takes a day or two, or a physical payment card that can take up to seven days to arrive in the mail. A lender can now approve a loan or line of credit and make funds available immediately through a mobile wallet.

An optimal digital lending program would be one that does both, adding a real-time option to a digital platform, for which the borrower may or may not pay a premium. This checks all the boxes the consumer is looking for:

  • speed and convenience – Funds processed in real time can be available in less than an hour, compared with 1 to 3 days for ACH or 5 to 7 days for checks.
  • seamlessness – borrowers who access their loan funds on the same channels as their checking and credit accounts keep those lending products top of mind.

When a lender stays visible as part of the borrower’s everyday financial ecosystem – at their fingertips across every channel, at every touchpoint – they become more than a lender. They become a brand, with a potentially meaningful relationship with the borrower. And that lender – the one that views borrowers as long-term, valued customers – will stand out.


Wirecard is a global leader in digital financial technology, connecting consumers with seamless, personalized payment experiences in real time – online, mobile, and offline.

Kevin Brown is Vice President of Marketing and Strategic Partnerships at Wirecard North America, where he leads brand expansion, partnerships, and the marketing and communications organization. A thought leader in technology and finance marketing, Brown tracks fintech trends and focuses on building connections that drive innovation in the payments space.

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