What's New In Consumer Financing? | Business is Booming For Buy Now Pay Later | B2B Vault: The Payment Technology | Podcast | Episode 125

What's up everybody, it's Justin live from B2B Vault, the payment technology podcast sponsored by Nationwide Payment Systems, hosted by this guy Allen Kopelman, and we'll be providing you educational information about fintech payment processing, small business, and the technology businesses use in the world today. And in today's podcast, we're going to be talking about consumer financing, uh, what it is, uh, what's going on with it, why is it so popular, where is it going, what's going to happen next, who's going to blow it up. Uh, I don't know, it's all kinds of cool stuff going on, uh, with it. Um, consumer financing has, uh, hit the ground running, I would say. Like, it's like setting a trail fire wherever it goes.

Um, well, the one thing that's hot is the buy now pay later. Yeah, that aspect of it, that really, that really fired up the, the market.

Exactly. Yeah, that's what I was getting to. But, uh, yeah, man, I mean, consumer financing isn't going anywhere. It's gonna get, you know, it's going— it's just growing. So, uh, What do you think, dude?

Well, I think that we're gonna see— been having some really interesting conversations. You know, having the podcast is, you know, attracts customers but also attracts new partners for, for the company, right? So bringing new products to, you know, bringing new products to, to our merchants, you know. So I'm going to tell you about some of the products of companies like we're talking to, and hopefully we're going to get reseller agreements with them, and then we'll be able to start offering those products to our, our clients. So one product is a really cool consumer finance product where, um, they have us— you know, that, you know, every company always has, you know, the type of businesses like that they're comfortable with, right? Right. So they have their list of businesses. It covers all kinds of stuff— auto repair, furniture, lots of, lots of verticals. Okay. And what makes their product unique is, is they have the same similar thing, 10 questions like we have on the Nationwide Payment Systems to get your merchant account. Yeah. So you'll be able to get consumer financing by filling out a simple application, then you get approved by the company, right? And they have a way, you know, linking up the bank account to set same way we're doing, where you log into your bank and do all that, right? And then you're approved. Now what makes their solution really cool is they want you to have a— they give you a QR code, you put it up in your business or on your website. Okay, maybe you sell something expensive like hot tubs or something, right? And the person uses their phone. They want them to use their phone, it's important. You know, to apply, right? So they scan the QR code, then the person fills out the information. And because it's on your phone, a lot of your information's already in your phone— your name, your address, right? So it kind of like helps you like self-populate the, uh, application.

Nice.

Then you're going to request how much money that you need. Let's say you're buying living room furniture, it's going to be $8,000, right? So you put that in and then your social, and then basically they go within a few minutes— takes less than 5 minutes— okay, they come back with multiple offers. Nice. So depending, you know, obviously depends on your credit score, and then you get to choose, um, you know, the different options. It could be like 12 months, It could be, oh, no interest in 90 days. It could be 24 months. They give you multiple, multiple offers on how to pay for this, how to pay the money back. So you choose your offer. You say, oh yeah, that's the one I want. Then you link your bank account up because you do go through like a thing, like people know Plaid, right? Where basically you're logging into your bank account. Well, you're connecting it. You've done that before, right? When you're using a service, sometimes you have to put link— log into your bank to connect it together, like in QuickBooks or— oh yeah, different things like that. So you're linking up your bank account so you don't have to have your routing and account number. Then once you're all set up, like I said, this process just takes a few minutes on your phone. They send you back through text message a virtual credit card, and then you should basically show that to the business and they can key enter your credit card into the terminal and you have your purchase done. Now, normal consumer— the consumer finance companies we talk to now, oh, you have to send them the merchant's information, then they want to call the merchant on the phone, then, then there's an application online that the consumer fills out. Then they approve them pretty quick, right?

Every time we talk about this— what I just have, like, there's just this one project that I, that I had.

Well, let me finish talking about the thing, and then we'll— so then you get the— so then the person gets approved and they, and they pick the thing they want, right? And it's all going back and forth through email instead of text and on the phone, right? And then the money goes to their— they give them their bank information, and then the money goes to their bank account. Right, then they have to go to the bank or write a check to the merchant, right? Now a lot of people don't have checks anymore, right? So they have to go to the bank and either, you know, go get a check from the bank and then bring it back to the merchant, and the merchant has to go deposit the check in the bank, and the whole process takes a long time. With this virtual credit card, you're cutting all that out. Boom, it's done. It's a done deal. So, so you— it's a done deal. So I think that's a real I think that's a real game changer. Uh, it's going to be a real game changer for businesses. And this company, they've been in business for a few years. A bunch of the people worked at another company that we worked with for a really long time, so I know a lot of the employees there and the people running the underwriting and risk departments.

Nice.

So it's very cool. So what were you going to tell me about a project?

Oh yeah, no, I mean, so you were It's like, you kind of hit it at two angles. One, you're talking about furniture, right?

Hypothetically, right.

And then, you know, the other one, so I was building a website for this furniture company, a big— they had multiple locations.

And this would have been a great product for that.

Oh, exactly. That's why I think about it every time, right. And so we were— we build out the website. And I get it all ready, and then here comes the time where they need to set up their merchant account.

Well, the furniture, first of all, because they can't use PayPal, right? But I'm saying furniture is in a higher risk category.

So I mean, I'm a web developer, right? I don't know anything about this, right, at the time. I, I, you know what I mean? This goes back to you all those times where we left money on the table, right? So like Of course, I'm like, yeah, we can sell yours. There's no limit on what you could sell online, right?

There is no limit.

I said, but you have to set up a merchant account, right? And he was like, okay, okay, you know, like, they were like, don't worry about it, we're gonna keep forward. So we're going along with this project, and it's kind of becoming a bit of a pain because they're adding stuff, they're adding stuff, you know. And of course, the— my price is changing, right? So we're kind of going back and forth or whatever. Finally, you know, we come to an agreement, everything, we're just gonna launch the site. So I go to the, to the location. And I'm like, alright, let's get to connect, you know, we got to connect the— you got to be able to take money, man.

Right?

And they're like, well, I thought you were gonna do that. And I looked at him like, what?

Yeah, it's not, it's not easy.

Furniture by Business, sir.

Right.

I'm not— I don't—

a lot of people don't understand.

No, they didn't. They had no— like, no, no. But so he had no idea, so he was like, well, let's use PayPal. I said, all right, you know, we could try, right? Well, you know, we did. We tried. We put one transaction through for like 8 grand and done.

Yeah, they're not gonna process that.

No thanks, right? So, uh, that didn't work. And then I said, well, where do you bank? Right? Yeah. And I said, you know, you have to have a bank account, right? And the guy looked at me, he says, yeah, right? Like, I was at this point, I'm like, what? No wonder I'm getting paid in cash, right? No checks at all. So I'm like, all right, man. So this guy's basically running his business off of PayPal, right? You know, like, the, the even— he's getting money on the store because he could swipe Right. And, uh, so yeah, but a lot of times, like, back when we first—

when, like, when I first got into this business, this company, I was working for somebody and they weren't doing anything with the internet. And that's why I started my own company.

Exactly.

We got to get on this.

He was losing so much money. Anyway, long story long, um, I told him to go to— what's the big one that we use?

First Data.

Yes. Yeah, tonight.

Yeah, we don't use them. But the next one, who—

Tezos?

No. Worldpay?

Yes.

Okay, denied. Yeah, but then, you know, you know why they kept getting denied though? Why?

Because he didn't have enough money in his bank account.

Oh, that's not gonna work. You got to show money. They don't want to have you—

so literally, finally I asked them, I'm like, dude, what are you showing these guys? I don't— he's like, I don't want to show them how much money I have. I was like, you're never gonna get— he's like, I'm showing them like $1,500.

I'm like, dude, they're not gonna—

one product is more than then you gotta— you have in your bank account, they're not going to approve your merchant account.

No, that's like, I get these startup companies, they show me a bank account with $300, and I'm like, the bank's not going to approve you.

So finally, dude, like, it's just sad, right? Like, because nothing really came of the project, you know, he never launched the site. And like, when I was just back in Milwaukee, I noticed like a couple of the stores are closed down.

Well, probably that's due to the pandemic.

Well, for sure, but at the same time, it's just like I mean, I'm always— I'm the guy, the guy, I'm the good guy, right? No, I'm not the bad web developer dude that takes your money and runs, you know what I mean? Like, you'd never hear from him again. I'm the guy that you paid, and I want to see your business succeed, right? So it just sucked that, you know, like, we— I couldn't help him. And I wish that I had the knowledge that I have now then. So that I would have been able to facilitate what he needed easier.

Yeah, I had a furniture guy and I was trying to get him, you know, we took him to a couple companies. They didn't want, like, no, no furniture, no fur— the problem with furniture is if it's cash and carry, it's pretty much easy to get done. But if it's furniture you have to order, a lot of companies are scared about that. We just had a meeting today on the phone with a guy with a furniture-related business And we're—

it's through the catalogs though, huh?

Yeah, it's through the internet. So he had some problems during the pandemic, but this guy survived. He has a big business, he owns a big, uh, factory. They make cabinets for kitchens and bathrooms.

Oh nice.

And all that. Hopefully we're gonna get— you know, we talked to a bank, talked to a few banks. Finally we found one that was interested because it's a big business, and the guy got shut off during the pandemic because of chargebacks. Wasn't his fault. He didn't owe any money. He had the money to give the money back.

That's crazy.

And they didn't treat the guy fairly.

Have you been to Adam and Joe's—

sorry, just random—

have you been to Adam and Joe's Inside lately?

No.

Do you know they still have the swipe?

Really? Yeah, because they have an old point of sale system.

You still have to swipe your card.

That's crazy. They need to get— they need to upgrade.

We should just go in there and like have a GoDaddy party.

Yeah, maybe. So the thing— and the other thing is like buy now pay later, which doesn't make sense to me. I'm not sure how these companies are posting multi-million dollar losses and how they're going to stay in business. I just don't understand it. There's already been a couple that have gone out. There was one called Quick Fee and there was another one that went out, but then I met Larna Shop Pay and What's the other big one? Affirm.

Affirm.

Those are Afterpay.

Afterpay. So those 4, right?

Yeah, are like—

I would say they have their stuff together.

I don't know, they're— a lot of them are showing losses on these.

Klarna is.

Yeah, Klarna has losses, and Afterpay and Affirm all taking losses.

Really?

Yeah, I don't know. Yeah, all 3 of them.

I don't know if ShopPay can, because you got to go straight to your account, right?

I'm not sure. And then Sizzle was another one. Oh yeah, Sizzle.

But they were—

they were—

I don't think they're taking losses because that's the one that was always—

they're very good money. They're very, uh, picky when they take people, right? And because—

and also there's fees involved with Sizzle.

Well, most of them have fees. Like, uh, like the one that's hooked up to Square, recently a merchant showed me their merchant statement from Square. And I was like, man, you're paying a lot of money for credit card processing. I was like, wow. And I started looking at the, you know, because you don't— they don't give you like a traditional statement. So the guy just had like a download. So I started looking at it. I was like, wow, you do a lot of that, um, buy now pay later. And the guy goes, oh, what's that? And I showed him, you know, how much he did. It was like $50 grand over 3 months, right? And the rate on it was 6%. That's what he was getting charged, and he didn't realize that he was paying 6% for that off every transaction. Yeah, for the Afterpay, for whatever. I don't remember which one is linked. I think it's Afterpay.

I don't know.

Yeah, I don't know. Whichever one is linked to Square, the guy was shocked. He's like, I gotta take that off my website because I can't afford that.

To offer buy now pay later.

Yeah, he said he can't, he can't, he can't live with that. It's too expensive.

You made $50,000 worth of sales and you're just finding that out?

Yeah, the guy didn't know. I've seen it before. I couldn't tell you how many times people show me their merchant statement, they say they're paying this, and then they find out they're not paying that, paying more, and then they get mad at me. And I'm like, I don't know why you're getting—

you're lying to me, you're just trying to get me to switch, right?

No, but I show it to them. I, I basically get them on a, you know, video call. Exactly. And I go over it with them. I go, here's your statement, let me do a screen share, look at this, you know, add these numbers up, divide this number by that number, you'll see what you're really paying, Dumbo. No, you gotta listen, you know. I'm gonna say, you know, merch, you know, figuring out how much you pay is pretty easy. You just take the fees divided by the sales, that's it, boom, that's your percentage. There's no other It's that simple. But if you're not doing that every month, you're doing yourself a disservice. You should know what your effective rate is.

I mean, you should be auditing your business all the time, right?

But a lot of people don't do that.

I mean, and I mean audit, I mean like your process, how you're operating your business, like everything.

But let's just talk about these opportunities.

Entrepreneurship Month. So I'm like, kind of. Yeah.

So, so then I met with some guys that was really interesting. I had to talk with them on the phone. And they're doing something interesting where they have a credit card for businesses, right? For buy now, pay later. Okay. Now it's not as crazy as the buy now, pay later, like up to 12, you know, 3 payments, 6 payments, 12 payments, right, that you normally see. Or like consumer finance where you're— this is a credit card. Obviously they're checking people's credit, unlike buy now, pay later, right? And then they're giving businesses and they're trying to target into like the construction business, the trade businesses, people who have to go buy a lot of supplies and then you get paid later, right? Materials, right? And then the— so let's say Justin owns a— he's, he's a handyman, he's a handyman remodeler, right? He's remodeling a bathroom and he needs to go buy all this stuff and the customer pays, you know, a deposit and then they pay along Usually you pay along the way, you make draws. Yeah, you pay like you finish part of it and then the person pays you another one.

The guy, the contractor needs to go get something and then he makes a draw and you could pay him for the work that he's doing, right?

And then at the end, you know, once the permit signed off on, you make your final payment. So this company has a way where those companies who do that, remodelers, construction companies, can get 60 days before they get charged any interest. I think that's pretty cool.

That's nice.

Yeah. And then businesses—

I mean, I don't, I don't— I'm not a contractor, so I wouldn't be able to say the timeline, but like for smaller projects, I'm sure that would work out great.

Yeah, even if you're getting a draw on a thing, yeah, it could work. So it gives them a way to give themselves some better cash flow.

It was interesting, it was this company and Well, that way they wouldn't have to put the money out of their pocket for the materials right away, right?

So that—

yeah, that's a good idea.

Yeah, so they can, you know, and then they can— that— so that— so they have purchases on there, and obviously when they get to 60 days, that's when they got to pay them off or there starts to accrue some interest. And then, so, so there were that— so, and then, you know, as— and that's good because let's say you're a con— let's say you're a a company, not like a Home Depot, but like a, right, a wholesaler of that lumber, of lumber, right? Now when your customer comes in, you don't have to float them credit because some of those places float people credit. Like they have their own—

yeah, man, like the painting places, right?

They float credit.

Paint shop, like, are you gonna go buy your paint, right?

So they float credit to the customer. And I've seen tons of places, lumber places, float people credit still. Yeah.

I wonder about now though.

I don't know about now, but they float people credit. Like if you've been in business—

carpenter. Yeah.

No, let's say you've been in business for 20 years. Yeah.

No, he was definitely getting—

yeah, they'll float you. You know, you have an account there and you go there and then every couple of weeks you go in and—

yeah, my godfather, we would go, he painted for, you know, right?

But they go and paint. No, but I'm saying he would go and pick up his paint Right, you'll pick up the paint, they sign for it, they put it on your account, then you go in and you, you know, every, every Friday or Monday and you're making payment, you know, paying down your bill there, right? And those come, you know, but you know, a lot of times, you know, that, you know, now the interest rates are up, right, right, on the Fed. So you're, let's say that business is accessing their line of credit to float their business, you know, now you have this buy now pay later for businesses. I think it's a pretty decent— it's a pretty good product.

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And I think it also could alleviate like some of those kind of businesses. We actually have a client that services like the construction industry in—

what way?

They sell lumber and, and hardware and different things to supplies. Yeah, supplies to, supplies to come to contractors. So this would be a great product for them because they would have to— when new people come in, they could say, well, you know, you don't have credit, we can't give you credit. Oh, you need credit, you don't have a credit card, or how about for this, how about try this card out, it gives you 60 days. Because a lot of business cards don't give you— like, I, I remember when I first started this company, right, we had an American Express card, and then we had the 2008-2009 debacle right, with, you know, inflation went through the roof, right? Like, so, like now. And interest rates went up and American Express canceled our card. It was actually a big mess because we had just purchased like $20 grand of ATMs. And I go to find out that they canceled our card. So you didn't get the M's? No, no, we got the ATM machines. But I get a call from the company and they're like, hey dude, they like your credit card went through, and then American Express like ripped the money out of our account and it says your account's closed. I go, what do you mean my account's closed? Well, we owed them $20 grand. Well, we did business with them and, you know, they, they, you know, there was like a trust factor and they knew where the ATMs were and where they were going and we were making money there. So I was like, well, we could— we'll pay them off over, you know, out of the price, basically the same way you're going to be paying American Express, right? We're going to pay them instead of paying American Express, right? We're going to pay them. So we like that better, right? So we paid them, but, you know, they had the money to float for us, you know. So, and they, you know, in any way, you know, we got, we got credit with them anyway as we started growing our ATM business because we would need to buy 2, 3 ATMs at a time. We didn't want to like We didn't have that kind of cash flow at the time when we were first starting to grow, so they would give us 90 days to pay off these ATMs. So you put the 8, you know, because you got to order the ATM, then it comes a couple weeks later, gets installed.

What'd you say? What did you say?

Like, I called American Express, you know what I'm saying?

What did you say to the company to give you that much trust?

Oh well, we were— we had those ATMs went in a really big—

what year was this?

2008.

So 14 years ago.

Yeah, they, they didn't really even know me and Dave that well at the time.

I'm saying, what's what I'm saying? What the hell did you do?

I just told them, I said, we're gonna give you the money, we'll pay it off. That's it.

But this is already after the fact that the merch is inside of your building.

No, the, the ATMs were not even installed yet. They were—

I'm saying you have them.

No, they were in process of getting shipped.

So, but I'm— what I'm saying is like, at that point, his, his merch is out the door.

Yeah, the door.

He's, he's sent it and they sent the ATMs.

They were literally— regardless, they were getting delivered like this.

He basically called me. They were basically— he was in his spot where like, I could do this. Either I'm gonna lose some money by having it returned to me, or I'm gonna give these guys the benefit of the doubt.

Yeah, so they did. They gave us the benefit of the doubt, and we told them, like, you know, we kind of did a little monthly payment on 20 ATMs, if you don't mind. No, it wasn't 20 ATMs, it was $20 grand. It was—

oh, okay.

It was like 3 or 4 ATMs, so it wasn't that— it wasn't that big of a deal, but it was, you know, it was—

it was a couple grand a month you had to pay.

So yeah, so we said, oh, we'll pay like $2,000 a month and whatever. The cash flow in the ATMs was really good, and and we were able to pay the ATMs off in like 3 months' time. So we paid it off, we paid off all the— we got the ATMs working. We were like the first company to do the armored car loading with this company. They really wanted these armored car locations because they were very busy, uh, nightclubs where they were going to go through like $50 grand of cash in each machine a week. So they worked with us and they said, you You know, they knew, like, oh, the guy doesn't pay us, we'll just keep his commission, you know, from the ATM machine too.

So there you go.

So they kind of had, like, you know, so they had you buy it. Yeah, but we made the payments and they were happy. So, so we had to go get another credit card. So we went and got that credit card.

What did American Express say though? You're just gonna—

they just told us to go pound sand. Oh, the economy's bad, blah blah blah, you can't have that much stuff. And we're like, what are you talking about? You canceled the transaction. You almost destroyed my business. Right? You canceled the transaction. You— they charged it back on the guy. They charged it back. They made us look really bad. And I even showed the owner. I go, look here, let me show you my bill, American Express bill. And I showed it to him and it showed the limit on the bill, right? I told him, I said, here, I'm gonna give you— I'm gonna— I'm gonna send you— I'm gonna scan— I'm gonna scan the document so that he knows that you're not bullshitting, right? So you could see that I had a $40,000 limit on my card. They canceled. They canceled it. They sent a letter too. I sent them the letter for that. They're like, okay, we're gonna work with you. You got, you know, we're gonna work with you. They knew the location was going to do well, these two locations. So they said okay. So, but then we got this new credit card. Then that credit card was a nightmare. It actually accrued interest on a daily basis.

I had a credit card like that.

It was horrible.

That was probably one of the first credit cards I ever had. My dad helped me get it.

Yeah.

And I didn't know, and I went to Atlanta.

Yeah.

And I got some gas.

Yeah.

And then I'm like, all right, I'm just gonna get like $50, right? You know what I mean? Like, I didn't have any, and I wasn't thinking. Like, this is my first credit card, right? Yeah. I don't, you know, like, my dad didn't give me the rundown, you know?

You don't get cash off a credit card, right? Oh, that was a cash advance.

Oh my God. On top of that, they hit me because I did it from the ATM, right? I did it out of town, right? I would— it was just fee after fee. It was a gas station fee. And like, my dad called me—

probably cost you $100.

Literally, it was like $80.

Yeah.

My dad called me that night. What the—

what are you doing?

Why are you in Atlanta?

No. So, you know, so we had to learn not to do that. And then we finally got a better credit card. It took a while because the economy was horrible, so we had to put up with that card and we had to like— because, you know, the problem was like, you got to buy some credit card machines, right?

What's a good rate on a credit card?

Not— I don't even know. No interest, just bought 7. Like, I— no, that's not good. That's horrible. We should be paying like 7.

7%?

Yeah, maybe less. I'm just saying, like like, I have a credit card now. If I don't— if I don't— I have to pay it at the end of the month, so I pay it at the end of the month. That's it. Boom. But you know, if you didn't have a credit card, you go to get some credit card machines, the guy's not going to give them to you. You have to write him a check. He's going to wait for the check to clear before you get your machines. See, I had to build a lot of trust during those days with my vendors because I would be like, hey dude, I need these credit card machines. I remember I went to the owner of this place that sells credit card machines locally here in Sunrise, Florida, right? I had to go there, told the owner, listen, I've been coming in here for like years, right? I don't have a credit card anymore. I don't have this kind of cash flow. I need 20 credit card machines. You're gonna get your money as soon as I get— I collect from my clients, right? I am going to pay you. And the guy was like, okay, he looked me in the eye and I said, if I have to give you money out of my personal bank account, I'll do it, whatever you want, I'll give you. And I gave him some money then. I said, I gotta— I need you to give me some credit. And he did.

Nice.

And then I used to go in there and, uh, you know, when we got—

what was this again, about 14 years ago?

Yeah, it was rough, dude.

The economy— the world is a different place, brother.

Yep. And, uh, it was rough. And then, you know, the guy, you know, he like— it wasn't a lot of money, it was a few thousand dollars, right?

But still, that's a lot of trust.

The guy trusted me. And we have— let me tell you, his son runs the comp— is the manager of the company now. Shout out— this guy listens to the podcast. So Sammy from JR's, I know you listen to the podcast. If you hear me shout it out about your dad Riyad, he's the one who helped me get started in this business. Because he gave me a copy of the green sheet that I write articles for now, and he gave me a copy of that. And then I learned I could start my own company. Me and Dave started our own company. So another, another cool product that we're working on now is this pay by bank product, which is really, really cool. You can, uh, put this on your website, pay by bank. I think it's going to be very popular. Pay by bank. So you click the button pay by bank, then you choose your bank, then it actually takes you to your bank's website. You put in your username and password, or maybe you have it saved on your phone or in your LastPass or whatever, right? You log in, you okay the transaction, and then boom, it, it, it takes money out of your— you know, sends the money from your bank account over to that company, and that company pays the merchant with a batch. I actually think that it's a very, uh, I think the product has legs. I think it's very unique. I think people might want to use that. Why would they use that though? Okay, because think about it, people use stuff similar— sending money by Zelle, sending money by PayPal, sending money by Venmo, right? Well, the difference is when you use those services, let's say you have a business and you have the Zelle, you sell people selling you money. Every time someone sells you money, right, you're getting a deposit, deposit, deposit, deposit. It's a freaking nightmare to reconcile. With this, they're doing it credit card style. So let's say you do 10 pay-by-bank transactions, boom, you get one deposit. I think it's going to be very, very popular. And the cool thing is we're working out— I just— working out the details of it. They're going to guarantee the payments.

People are really like are opting to pay with their— like, how do you pay by bank? I know, but how do you—

no, they're— and they're going to guarantee the payments up to a grand, $1,000. So they're going to guarantee the payment to the merchant. But what I'm saying is, is this could displace— like, get rid of PayPal, stop getting Venmo, stop— you could have it in your barber shop. Hey, pay by bank, boom, send the guy a link. He pays you but through his bank account. I mean, I— yeah, it's the same thing as paying by PayPal.

I don't know how many times I'm tired of talking about PayPal and Stripe. No, I mean to like my buddies and business owners because they don't listen. You guys aren't listening, right? Don't listen about how much money you're losing, right?

The fees on that has gone way, way up, way up. It's more expensive than merchant services now. People don't understand. And you're getting multiple deposits because—

and they're shutting down, bro.

Yeah, they shut—

I know so many small business side hustlers. Yeah. That have lost thousands of dollars in the past 6 months.

No, no, but what I'm saying is, is when you're using those services, hundreds of thousands of dollars, when you're using those services, you're getting a deposit one by one by one. With this, you're getting a batch, right? You're getting a batch.

I mean, if they have it set up right. You're assuming that they have their—

no, you got it.

Because a lot of people don't have their accounts connected to their business accounts. So then they're just having money in PayPal, they got money in Cash App, they got money in Venmo, in Apple Pay, in Google Pay, in this pay, in this way.

Come on. Yeah, you got to get organized and run your business the right way. But this product is really cool, and I see other— because now you have this thing called FedNow, which is kind of the same thing about how to move money, right? And then you have I was reading about this company Jack Henry, that they're trying to launch a P2P product to compete with Zelle, right? But this is a product you can use in your business, right? You don't have to use a P2P product to do B2C. You're doing business to consumer, right? So you don't want to do a P2P. Like, someone wanted to Zelle me money the other day for a bill. I'm like, no, you can't Zelle money to my personal bank account. This is a— I have a business, right? You need to, you know, go. I said, you hear, I'll get— you know what I ended up doing? I sent the guy a deposit slip for my bank account. I mean, I knew the guy. I said, here, go over to Truist and go put the money in my bank account. I can't— you cannot sell me money and then I'm gonna go take it out of my—

I mean, you could have sent them an invoice.

I did. He didn't want to pay with a credit card.

Why?

I don't know. The guy didn't want to pay with a credit card. He's like, oh, I want to just pay you from my bank account. So I was like, yeah, I'll send you an ACH, right? No, I don't want to do that. So I'm like, you can't Zelle me money to my phone because I'm not taking it, right?

I'm not— you end up going to the bank?

Yeah, he went. I sent him a deposit slip and he went over to Truist and deposited the cash into the business. Yeah, it's my business account.

I—

well, I have one account where I don't keep any money in it, so that's the account I gave him. Well, I'm just saying there's no money in that. It's not like my operating account. It's another bank account that's there that we use to transfer when we have to pay everybody at the end of the month. Put money in there and then it goes out the next day. So we don't keep a lot of—

it makes sense.

Yeah, yeah, yeah. Not keeping a ton of funds in that bank account. So that's what, that's what we were doing because people wire money to us. I was just sending it to there, that bank account. They send it there, then I move it to the operating account. So the whole thing is, is, you know, I think that that's going to become a thing, this PayByBank. And I think a lot of small businesses can use it. You know, you can— it can be used on a website, and it's going to be less expensive than PayPal, less expensive than Venmo, less expensive than— it's going to be way more efficient than Zelle.

And it's probably 10 times more efficient if you have your merchant account through your bank, because I can tell you right now that their, their fees on those are crazy.

Yeah. And, and you can get, you know, we're trying to— and we're going to talk about, you know, we're going to— but we want to, we want to promote that to people with e-commerce, right?

Yeah.

Hey, this pay by bank, it's guaranteed up to $1,000. So there's really cool products coming out, you know, that's not necessarily consumer finance, but it is a really cool product for consumers because Because when we look at a product— well, me and Justin, we always do with the products, right? We say, oh, is that a thumbs up for the business and a thumb— a thumbs up for the consumer, right? The buyer. And a thumbs up for the merchant. So consumer financing, now with the one that we just talked about, right? Good for the consumer because easy to use. They get the credit card right there, run the transaction. So it's great for the merchant. Yeah, right.

It's awesome.

The merchants—

you talking about the credit card for— no, the service guys.

No, the, the credit card, the, the consumer finance where they're doing it on their phone. Oh yeah, they get the virtual card. That's a win-win for sure, because now the consumer doesn't have to go through the hassle of going to get a check and bringing it back to the business and then waiting to get this product. Can be happening now. Everybody wants it to happen now.

Indeed.

And the business is going to like it because they can apply and get approved right away. So that's cool. Buy Now Pay Later— I'm on the fence with Buy Now Pay Later, you know.

I think it's great for the consumer.

No, no, yeah, but I'm just saying, like, I'm on the fence, like, if it's gonna have long-term success. Because I think what's gonna end up happening is— this is my prediction on Buy Now Pay Later, just remember you heard it here on the B2B Vault. I believe that, and, and Apple is looking at incorporating it into their Apple credit card. And I think we're going to see a lot of banks, including Apple, although they delayed the release of their buy now pay later, I think we're going to see, um, credit individual credit card companies add the buy now pay later feature to your actual credit card and basically, uh, put a big dent in that, in these buy now pay later companies. Because what if you could go and let's say we'll just use— we'll just use your— we'll just make up a credit card, the fantasy credit card, right? That's your credit card you use all the time. What if you could do this? You go into the— you, you're online, you want to buy these cool— you want to buy some cool shoes. Right? They're $200 or $100. You all want to do— and, and you just buy it. And then when you get— when you go log on to your credit card, you can go tag that transaction to the Buy Now Pay Later. So now it gets a lower interest rate, right? And you have set payments to make on that thing, and the bank automatically debits that from your you know, your credit card company automatically sucks it out of your bank account, right, to pay that $200 off. Let's say it's going to be $50 for the next 4 months, right, this $200 shoes, right? I think that we're going to see the credit card companies themselves start to offer their own version of buy now pay later. And because they're losing tons of traffic on their credit cards by missing out on that business, right? I mean, so I think they're gonna—

for the people— because typically the people are using it don't have a credit card.

Well, the pro— that's the problem, because they, they're using debit cards, and that's why these companies are losing thousands of dollars.

Oh, because they're canceling their cards, canceling the card.

So that's why I think, like, I think that Apple Pay and some other credit cards are going to start offering that. But that's my prediction.

But when you set up, like, Auto pay, it don't matter.

Yeah, but if the bank account's closed, close your bank account, right?

But if you're not going to do that, people are going to the extreme of like buying stuff. Yeah. And then closing their bank account. Yep.

Whoa, scammers. Yeah, they go pound. Yeah, that's what they're doing. So I think that we're going to see a big shift in buy now pay later. I think we're going to see Apple put it on their credit card. We're going to see other banks put it on their credit cards. And I think this B2B, um, B2B credit card, if these people are well-funded enough, I think it's gonna— I think it's gonna work if they can get in front of the right businesses to help them promote the card. Yep. You know, it'll work for contractors and give them a better option, give them 60 days no interest. That's pretty cool. That's good. So that's B2B Vault for today. Consumer financing and business financing all together. Financing. And I think the pay-by-bank thing is going to be a winner. It might take time, but it's going to be a winner product because I think it's, it's a product that could work, especially. So that's it. Yo, wait, what?

Happy Entrepreneurship Month! Yes, follow us on TikTok, Instagram, Facebook, Twitter, LinkedIn. That's it. And YouTube.

And find us on all the podcast networks and, you know, wherever you listen to podcasts, just look up B2B Vault. Boom. Oh, you know what we left out in the last podcast when we were talking about verifying, uh, your account? YouTube needs to— oh yeah, they need to like— they'll be on there with like one video and stole our name. Yeah, they stole our name, like They don't even—

if you need a merchant account, go to b2bvault.info. There's an Apply Now button that sends you over to Nationwide Payment Systems, our sponsor, partner, friend to the very end. We love you guys.

10 questions and in 5 minutes you get a merchant account. Peace.