Introducing Payouts: send refunds and settle payments in seconds

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Murtaza Bootwala, Head of Product
22 Feb 2023
Fluid payments texture

Every time you pay a customer, it's an opportunity to keep them loyal. Whether it’s customers requesting refunds, users withdrawing their winnings or sellers accessing their earnings – payouts should be instant and easy.

But systems for sending outgoing payments are siloed and seriously slow. The compliance is over-complicated, the experience is fragmented and funds can take days to settle — that’s if they don’t get lost completely.

And that’s not really good enough, so we’ve built Payouts to take the pain out of paying people.

TrueLayer Payouts lets you achieve a great customer experience by enabling instant refunds and withdrawals on the fastest payments rails, while ensuring a compliance focused process. Supported by open banking-enabled account verification, it makes sure you’re paying the right account, right away. (Which is how payouts should work.)

Here’s what that could do for your business:

  • Boost customer loyalty by initiating payouts that settle the very next second, 24/7. That’s far faster than the five days cards or Bacs can take.

  • Eliminate the cost of lost or failed payouts by using bank-verified account information to automate payment setup.

  • Ditch manual tracking processes by initiating payouts via a single API, removing errors from the whole equation. 

  • Streamline due diligence and instantly confirm account ownership by verifying that a user’s name matches with what’s on file at their bank.

The payouts problem

1. Traditional methods take ages

In this day and age, no one wants to wait to get their money. People expect prompt payments that settle in seconds. The five days it can take for card and Bacs payments to appear pains customers and doesn't exactly build customer loyalty.

2 in 3 shoppers consider time taken to receive a refund an important factor to shop with a merchant again

YouGov (2021)

This is made worse when businesses, as part of their due diligence, need to verify a new user’s payment details and identity before issuing a payout, stopping customers mid-flow and making the process even slower. Cue customer churn.

It can take a user up to 10 minutes to upload their bank statements and three more days for compliance teams to review and validate them. Other methods like micro-deposits can take a while to settle and can be cumbersome for users to confirm. That’s not to mention what happens when IBAN or account details are entered incorrectly, and the user has to start the whole process over again.

But the problems don’t end there. 

2. For businesses, the whole thing is costly and extra effort

Paying out to customers means managing multiple reports, scrolling through endless rows of data, and manually tracking each payment. And that leads to a whole heap of operational inefficiencies, input errors and complaints from customers whose payouts were never issued — or worse, lost.

Simply: current payout processes are extra slow, extra effort and prone to errors. And that kills customer loyalty.

2 hours of labour goes into one return – this typically costs £30.00 (2h x £15)

Source: Loop Returns

So, we’ve built a solution: automated instant payouts

Payouts combines open banking account verification with the fastest payment rails available. 

The process is simple:

  1. The user requests to withdraw funds or to receive a refund

  2. The user gives us consent to access their banking data

  3. The user is directed to their banking app where they confirm they own the account using their fingerprint, FaceID or login details

  4. We compare the user’s name in your system to their name on file at the bank, and immediately verify whether it matches

  5. With the user’s details verified, a payout can then be initiated

By verifying the account details before paying out, you can say goodbye to the days of failed or lost payments, reduce the strain on customer support and accelerate compliance checks. And by offering instant payouts, build customer trust and encourage others to switch over to your service. What’s not to love?

1/3 investors would consider depositing more money if they could withdraw instantly.

YouGov (2020)

Is it for my business?

Payouts serves any business that wants a scalable, automated payouts process that will improve customer experience. In particular it’s been designed with ecommerce, wealthtech and trading, marketplaces, and iGaming in mind. The most common use cases include:

Real-time withdrawals

Increase retention and encourage service-switching by granting instant access to funds, without having to go through lengthy verification processes.

Instant refunds

Keep customers coming back by automating instant refunds and giving them what they want: their money back in seconds.

Platform and marketplace payouts

Confirm bank account ownership and give sellers and freelancers immediate access to their earnings.

How will my customers benefit?

They get their money as and when they want it.

There are no extra verification hoops to jump through, card details to remember or wait times to endure. Just a smooth payout experience that lets them get on with their lives.

There’s no settlement anxiety.

Payouts are far less likely to fail due to human error, since their account details are pre-verified and initiated via an API. Did we mention no wait times?

We built Payouts to take the pain out of paying people

And by removing that pain, you can create a compelling value proposition for your entire customer base: access your funds as instantly as possible. Using the fastest payments rails across the UK and EU and supported by open banking-enabled account verification our Payouts solution is designed to support businesses at every scale. It’s why the likes of Revolut, Cazoo and Nutmeg trust us as their open banking payments provider.

So if you’re ready to increase payout success and drive customer loyalty, speak to one of our payments experts today. 

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