Nium’s Robin Gandhi on the challenges of real-time payroll

Providing real-time payment solutions for payroll becomes harder in a global economy, but Nium is up to the task, CPO Robin Gandhi said. A fintech veteran, Gandhi served in several roles with Adyen before moving on to corporate travel solutions.

Gandhi is on the opposite end with Nium, seeking to improve payments in an increasingly diversified employment marketplace. Companies can hire people from all over the world, and doing so has clear advantages. But paying freelancers, gig workers and regular employees efficiently and on time are challenging when accounting for KYC, AML and currency conversion.

How COVID-19 drove interest in digital B2B payments and payroll

Digital B2B payments are a hot topic post-COVID-19, Gandhi explained. With growing economic uncertainty, companies are prioritizing real-time visibility into their operations.

“It’s a multi-trillion-dollar market, but there is much low-hanging fruit,” Gandhi said. “And payroll is one of them.”

Credit COVID-19 for accelerating paytech by close to a decade. People returned home to work during the pandemic, whether around the block or the world. Companies needed to adjust their payment mechanisms to account for this sudden change.

Some of those adjustments are here to stay. Many firms don’t need people in the office all the time or even any of the time. They can hire people from anywhere, and there are clear cost advantages.

Global, real-time payment challenges, especially in payroll

Robin Gandhi - Chief Product Officer of Nium
Compliance issues are the most challenging aspects of real-time payments, and it takes persistence to address them, Robin Gandhi said.

But there are also challenges. People want to be paid on time, and money transfers can take days via legacy systems. That affects currency exchange rates. KYC and AML checks must also be performed. Gandhi said something as simple as a worker with a familiar name could bring issues if someone with the same name is on a sanctions list.

Gandhi said good engineers can build technology, but it takes persistence to resolve many compliance issues. There’s plenty of work with regulators and governments to get licenses. Once that is settled, it’s on to finding the best banking partner.

The entire process happens within a series of time crunches. Clients have a set schedule, and you must succeed within that. Miss a milestone, and it’s a six-month delay. So, the tech companies need to move fast, but regulators must ensure the system is clean and safe.

Bringing real-time payments choice to clients

Gandhi said Nium’s product philosophy focuses on breadth. Help customers in as many geographies as possible pay in many ways.

Customers decide how soon they want to pay their clients. The longer the period is, the more currency risk it brings. That influences the cost, but customers know precisely how much they must deposit into the system before the money goes out. All recipients are pre-screened.

“Send us this information on whom you want to pay beforehand, and we’ll check it; we’ll make sure that we check it before it goes through that,” Gandhi said. “If there’s something wrong with it, and we think it’s correctable, we’ll send it to you so you can make that change.”

Is there room in the process for verified identities? Gandhi isn’t sure. Clients may have customers with thousands of payouts. That end customer isn’t sending Nium that volume of information. They are sending what they have. That gets run through the system before payments are sent directly or through a banking partner.

Does AI have a place in Gandhi’s world? He sees it as helping with risk scoring by analyzing signals faster. Perhaps ChatGPT can be used to help firms create, say, virtual credit cards. But that’s down the line.

Gandhi expects payroll to double from a $10 billion sector in 2021 to $20 billion in 2031. Watch for spend management solutions. Already at $20 billion in 2021, it too is expected to double (to $40 billion) by 2031.

“You empower your employees to spend company money, but at the same time, you have so much control because you have real-time visibility into where your money’s going,” Gandhi explained. 

The unique needs of the creator economy challenge platforms like Facebook and Spotify to find ways to pay creators easily.

“It’s weird because someone like Facebook or Instagram doesn’t care; they don’t want to know who you are,” Gandhi suggested. “In fact, they would prefer not to know who you are.

“But I need to know who they are to ensure I don’t get in trouble for facilitating money laundering or terrorist financing. So it’s an interesting place. Those are the types of solutions we’re looking into; how can we enable them to keep not caring who they are, but at the same time, enable them to pay someone they want to pay that’s going to drive like this new business that they have.”

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  • Tony Zerucha

    Tony is a long-time contributor in the fintech and alt-fi spaces. A two-time LendIt Journalist of the Year nominee and winner in 2018, Tony has written more than 2,000 original articles on the blockchain, peer-to-peer lending, crowdfunding, and emerging technologies over the past seven years. He has hosted panels at LendIt, the CfPA Summit, and DECENT's Unchained, a blockchain exposition in Hong Kong. Email Tony here.