Latest / The Payments Shed / Ep. 10 - Cracking Open Banking in the US with Aeropay CCO Sarah Stapp @ Money 20/20 USA 2025

Transcript

Ep. 10 - Cracking Open Banking in the US with Aeropay CCO Sarah Stapp @ Money 20/20 USA 2025 · The Payments Shed

• 0:05
  Welcome back to the Payment Shed podcast live from Money 2020
• 0:09
  USA. We are joined this afternoon by
• 0:12
  Sarah Stapp, CCO from Aeropay. Sarah, welcome to the show.
• 0:16
  Thank you for having me. Thank you for joining us.
• 0:19
  Please introduce yourself, Tell us a little bit about your
• 0:21
  career in payments today and a little bit about Aeropay as
• 0:24
  well. Yeah, so I am a self-proclaimed
• 0:27
  payments nerd. I realized when I was talking
• 0:31
  around at Money 2020, I'm now at 16 years.
• 0:34
  I kept saying 15 years, but then I would go through the spiel.
• 0:36
  I'm like, oh, I have to add another year.
• 0:38
  We're very similar. 10 year then, yeah. 12 years of that, I
• 0:42
  was at Braintree PayPal. So I was employee number 20
• 0:44
  there very early days. And it was a part of the team
• 0:49
  that did the international expansion outside of the US.
• 0:52
  And when we first started, it was, we were just reselling
• 0:55
  first data before they were Fiserv, right.
• 0:58
  And we, we got an ISO. We, we upgraded to an ISO in the
• 1:03
  US and the executive team was like, oh, that was easy, let's
• 1:06
  do that everywhere. So we launched over the next 10
• 1:10
  years that I was there, we launched 37 markets in Europe,
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  Hong Kong, Singapore, Malaysia, Australia, New Zealand, Canada,
• 1:19
  Brazil and we got everything production ready for India.
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  Although we never went live, it got shuttered right before we
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  were ready to launch it, but we did do the work.
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  So very interesting global remit, got to learn a lot of
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  different payment methods around the world and how things are
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  just, you know, completely different than how it is in the
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  US. After 12 years of that, I needed
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  a pallet cleanser. Yeah.
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  So I did payment consulting for about 3 years.
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  Merchants and payments. Kind of a combination of
• 1:50
  payments companies, fintechs and merchants.
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  How did you find that transition into consultancy?
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  It was very nice because I think towards the end of my time at
• 2:01
  Braintree PayPal, I wasn't in the thick of things working with
• 2:06
  merchants as much anymore. And it was really nice to be
• 2:08
  able to be in the trenches with merchants solving problems and
• 2:11
  like looking at the data and how do you reduce interchange and
• 2:14
  how do you do that. I.
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  Know some people that have gone payment side to merchant side
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  employed as well. And I always ask them would you
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  go back the other way? I think 80% of them say no,
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  yeah. Merchants are the bells of the
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  ball, man, that that that's the I'm I always picked the wrong
• 2:28
  side. I think of that like I'm on the
• 2:29
  acquiring side and I'm looking over at the issuing side.
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  I'm like, wow, you guys make a lot more money over there, but
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  such is life, right? But yeah, I did payments
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  consulting for a few years and then I joined Aeropay about a
• 2:41
  year ago as chief commercial officer.
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  Aeropay is AUS pay by bank provider.
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  So not the, you know, E check days of your where you're
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  putting in accounting and a routing number you're logging
• 2:54
  with your credentials. It's secure, it's seamless, it's
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  modern and just very excited about where we're at in the US
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  as far as ACH and pay by bank, where we haven't had nor do I
• 3:08
  think we're gonna have a pix moment like in Brazil.
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  It's gonna be this gradual increase of adoption with
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  innovation and fintech players and the consumer base gradually
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  bringing it more to the forefront of regularity, if you
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  will, in the US market. So really excited to be part of
• 3:28
  Aeropay right now and. How does open banking,
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  specifically the pay by bank element, differ between the US
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  and Europe? In like actual mechanics, pretty
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  some pretty similar, right. But what we don't have, which
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  Europe has had and I think I've talked to many friends across
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  the pond on how that's rolled out in the UK, you know, and
• 3:49
  across Europe and they actually tell me that they're jealous of
• 3:53
  the US because we don't have the standardization and the
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  regulation. I think I was part of the PSD 2
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  project at Braintree. Well, I was voluntold that I had
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  to be part of. That.
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  But it was actually a very interesting project.
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  But we don't have a common framework, you know, we don't
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  have all of that regulation. And even with the administration
• 4:13
  today, a lot of that is kind of up in the air.
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  So it's been up to innovators and companies within the
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  ecosystem in the US coming together and saying this is what
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  we're going to do in lieu of a, you know, regulatory oversight
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  or a regulatory framework. So it's been, I don't want to
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  say Wild West, but it's been very, you know, kind of cutting
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  edge, innovative of framework of everybody coming together and be
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  like, how should we do this instead of somebody telling us
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  what? To do, should you do anything
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  data side as well? Because that data topic's very
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  relevant at the moment. When you talk about the
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  regulatory changes and seven years working towards 1
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  framework, that then gets torn up very quickly.
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  And we're like charging for data here now, right?
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  So is that the world that you guys dip into or do you purely
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  focus on the payment rail? No, we do.
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  So it's actually very interesting in the US ecosystem
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  you have players who will focus on one piece of the the money
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  movement or risk or the bank linking piece, right.
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  We do it all. It took us a long time to get
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  there, but we have a full end to end in house solution where we
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  we have the bank linking, we use AI to make the risk decisioning,
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  we'll move the money and we will do ACH recovery on the back end
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  if there are returns that come through.
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  So we're there are other companies that do it, but we're
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  unique in that respect that we have it all in house.
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  We built it all in house versus partnering or leveraging other
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  tools. But data is literally the most
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  important thing to our business because that open banking data
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  will feed into our risk decisioning engine.
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  It also feeds into our recovery engine.
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  And that's how we're able to provide a guaranteed solution.
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  That's how we're able to keep acceptance rates high, keeping
• 5:58
  fraud rates low, etc, etc. And that's ubiquitous across all
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  the payments, right? Where more data is usually
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  better? There can be a bit of a
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  misconception around who owns the data as well.
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  And I think the JP Morgan news came out, we're talking about
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  charging for data, right? And it reminded me a little bit
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  of that whole narrative with the schemes around you charge too
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  much. I always take it back and go,
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  what are you benefiting from that product or service?
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  And maybe there's something in, you know, the amount of API
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  calls, right, that can be pushed through like there's a cost to
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  that, right? Somebody has to pay for it.
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  So I, I just feel like that narrative is very much like
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  shouldn't be charged for data at all.
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  But then you kind of scratch below the surface a little bit
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  and you're like, maybe they should be charging for data
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  like. Maybe a little something.
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  I mean, keep the lights on, maintain the the connections and
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  things like that. Yeah, I think so.
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  I like the fair usage idea though, right?
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  Like, if you're hammering those APIs, you're going to pay more
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  of a premium for it than someone that's not hammering them to the
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  same level, right? But I mean, even on the credit
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  card side, right, a lot of companies don't know it, but the
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  acquirers, they're paying per packet use, they're being
• 7:03
  charged for their API usage as well.
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  It's buried in a scheme fee somewhere, but there is a cost
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  for sending that data across the interwebs.
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  Yeah, close there is. So what does the future look
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  like for Aeropay then? You've obviously got a very rich
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  stack like you say, servicing pretty much all parts of the
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  open banking ecosystem. I don't know if you you lean
• 7:24
  into one product more more than the other, but what's what's the
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  next step in your journey? Yeah.
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  I think we've, we've been, we've been quite successful at
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  bringing this bundled solution to direct merchants.
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  We're seeing, I especially over the last, I would say 12 months
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  where where we have initially seen a lot of successes and
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  regulated and high risk industries where one, acceptance
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  rates are lower than low risk industries, chargebacks may be
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  higher. And, and the card brands just
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  deeming it a high risk category, you know, you've got to pay
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  additional fees and registrations and things like
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  that, right. So where we've seen a lot of
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  success in gaming, for example, and now we want to expand that
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  into medium and low risk categories.
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  Think marketplaces where you've got to pay in and you've got to
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  pay out, bring those cost savings and bring payment
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  methods that more and more consumers are not demanding but
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  are at least curious about. There was a payments.com art or
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  white paper that was published recently that said 81% of US
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  consumers are at least interested in trying pay by
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  bank, although only about 10% of them have used it in the past 12
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  months. So I think folks are, are
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  looking for that and merchants are interested in figuring out
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  how to make it work either through incentives, loyalty
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  programs, bringing them in through a payout process or
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  something like that. Yeah, Cuz at the end of the day,
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  you know, I think consumers will do what is easiest and most
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  convenient. And that's our, that's our
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  challenge. That's what we think about
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  everyday is how can we make a pay by bank solution or check
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  out experience be just as easy if not easier than a Apple Pay,
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  Google Pay credit card transaction.
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  And open banking certainly not in it's infancy anymore, right?
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  It's probably not even in it's teenage years now, right?
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  It's like what is the next stage for open banking?
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  There's been some consolidation in the market.
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  There's been some great use cases.
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  There's been so not so great use cases as well.
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  But it's a really exciting time I think for the going into that
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  next phase of of the the open banking ecosystem in general.
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  So we're in Money 2020 in the USA.
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  Why is this such an important event for you guys?
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  Yeah, I think Money 2020 is always super exciting.
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  It's a time when I joke about it, but it's funny because it's
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  true. It feels like a payments high
• 9:56
  school reunion, right? You're seeing all these people
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  that you knew at former companies who have now gone to
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  this place or that place because.
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  It's not an incestuous industry, right?
• 10:05
  No, no, not at all. Not at all.
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  And hearing where they're at now, what their challenges are,
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  because when I was at PayPal, Braintree, for example, I was
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  literally covering almost the entire every time zone there was
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  to cover, but just credit cards. Now I'm with Aeropay, I'm very
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  hyper focused on the US and ACH, it's really nice to just pop
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  your head up every once in awhile.
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  You're heading to be like, what's going on over there?
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  What's going on over here? And hearing perspectives from
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  merchants, from payments companies, figuring out
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  collaborative, you know, opportunities and just staying
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  in touch with what's going on. I like I said, I am a huge
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  payments nerd. So I just love hearing about
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  challenges and use cases and how people are overcoming them, the
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  innovation and the the solutions that folks are coming.
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  Are coming up in an open industry as well in terms of
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  like and we weren't always I think there used to be a bit
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  more secrecy around what each other were doing.
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  But so now it's kind of open house.
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  We're building this and we want everyone to know we're building
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  it and that leads to faster innovation and developments from
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  from other players, right? It's really interesting you say
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  that. I was having almost an identical
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  conversation. I did a little panel here
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  earlier in the day with a, with a lady from Synchrony and
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  another lady from MasterCard. And we were literally just
• 11:24
  talking about how not just AI Gentek A and all that, but like
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  tokenization, all of these things are coming together to
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  where it's almost this connective tissue, right where
• 11:33
  we all now have a playground where we can play nicely
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  together. And it's just, I think it's just
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  we've all had to increase our game with, to keep up with AI to
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  be. I mean, I have never, I'm only
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  40 years old, but the I've never seen innovation that is just
• 11:57
  skyrocketed like AI. And we have to keep up as an
• 12:00
  industry to protect consumers, to protect our merchants, to
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  make sure that we maintain an ecosystem payment.
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  That's why payments is so interesting to me.
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  I don't know why you got into payments like.
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  What I say to my friends with payments is why it's such a
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  great industry to work in. Is there's always something new.
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  Yeah. There's always a new product or
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  service like we drive so much of kind of a global movement of
• 12:23
  money, right? So things have to move forward.
• 12:26
  Yes, no year is ever the same even at the same company, right?
• 12:29
  And that keeps your job really, really interesting.
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  We, we, my team, when I was at Braintree, we would say payments
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  never sleeps. You know, there's always money
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  moving. But I would say, you know, we're
• 12:38
  not doing open heart surgery, but it matters what we're doing.
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  Like people would say, well, what happens if you're gonna if,
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  if, you know, you're down for two weeks.
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  And I'm like, if we're down for two weeks, we have bigger
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  problems to think about. There is something cataclysmic
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  happening, like global issues are happening, but it's just
• 12:56
  such a critical part of our global ecosystem.
• 12:59
  And merchants want things faster, consumers want things
• 13:01
  faster, right? And we have to kind of adapt and
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  lead the charge with that as well.
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  And easier. It has to be easier to pay too.
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  100% somebody told me one of my payments friends coined this
• 13:12
  phrase, which I'm trying to make a thing.
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  So if you can help me with that, that'd be great.
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  Couch payments. I was like what?
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  What is couch payments? And she said it's if I have to
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  get up off my couch and off of my mobile device to make a
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  payment, it's not good enough. I hate it when I have to this
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  occasion. You have to get a card out now.
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  Like you're scrambling around, like, where's my wallet?
• 13:31
  Where's my card? Like yeah, I have to put.
• 13:33
  In a CVV code? Come on, I probably won't do the
• 13:36
  transaction anymore, that's how lazy.
• 13:37
  There's a lot of people that say to me if if I can't pay Apple
• 13:40
  Pay, I'll go somewhere else like, and that's a, you know,
• 13:43
  merchants need to think about that.
• 13:45
  Yeah, Look, super interesting chat.
• 13:47
  We have a final section of the the show.
• 13:49
  All of our guests are asked to nominate something for the
• 13:51
  shelf. For shame, never to return a
• 13:53
  game. It can be from business
• 13:54
  payments, fintech, whatever you like.
• 13:56
  What's your nomination today? I'm going to go with paper
• 14:00
  checks. OK, Paper checks.
• 14:02
  Well, you know, the IRS in the states, they're by 20-30.
• 14:06
  They said they're not gonna. They're not gonna.
• 14:09
  We sat in the UKA few years ago, We were gonna get rid of paper
• 14:12
  checks, and they're still around.
• 14:13
  Still around? Yeah, yeah.
• 14:15
  I would, I would love for that to be the case.
• 14:17
  We have, we're very cash and we still have a lot of cash and
• 14:20
  checks in the US and I look at Sweden and they're, you know,
• 14:23
  cashless and all that. It's like, that would be great.
• 14:25
  So I'm I'm going to go with paper checks.
• 14:26
  I would quite happily get rid of paper checks.
• 14:28
  The other thing they do in the UK, if you, you ever get like a
• 14:31
  refund from a, a utility company or whatever, they'd love to send
• 14:34
  you a cheque because they know that you've got to go and cash
• 14:36
  that. And there's not many branches in
• 14:37
  the High Street anymore for banks as well.
• 14:39
  It's like just like a deliberate ploy to not give you your money
• 14:42
  back. So 100% we will put paper checks
• 14:45
  on the shelf shape. And thank you very much for
• 14:46
  joining us. Today, Yeah.
• 14:47
  Thanks for having me.