Aging payment rails is an old problem for the U.S. banking system, but the collapse of Silicon Valley Bank recently brought it to the limelight, impacting companies who depended on their payment rails. Payment rails refer to networks that enable the transfer of money from the payer to the payee. In the recent years, newer payment rails have emerged such as the blockchain. Additionally, peer-to-peer payments through services like PayPal, Venmo and Zelle have made possible real-time payments without any hassle.
One such company who was impacted by the collapse of SVB was Airbase. Its CEO Thejo Kote informed TechCrunch+ that the company had to rapidly act to ensure seamless and secure payments for payroll and vendors.
The U.S. banking system has not seen an upgrade to its payment rails for decades, though financial technology players have built new ones like Plaid, Stripe and others. Visa, too, recently partnered with PayPal and other companies to offer digital payments across different apps.
Those in the fintech space argue that decentralized finance payment rails, based upon the blockchain technology, could be the ideal solution to this problem. As payments move towards real-time micro-transactions, the possibilities to build on current aging payment rails will become more apparent.
One such initiative comes from the Federal Reserve’s FedNow Service, which is expected to launch in July and provide faster payment rails to financial institutions.
The company Airbase is a fintech company that provides payments services. Founded in 2016, the company handles P2P payments, payroll and payments to vendors. Airbase offers a wide range of features to help customers manage their payments, and provides an intuitive dashboard to collect financial data and insights.
Thejo Kote is the CEO of Airbase, a fintech company that specializes in payments services. With an experience of more than a decade in the payments industry, Kote has been able to lead Airbase from a startup to a successful company. Kote has kept Airbase on top of the latest payment rails trends, and is constantly striving to deliver efficient and secure payments for customers.
