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Industry Interview: Laurence Cooke, Founder & CEO, nanopay

Payments are increasingly moving digital, increasing the need for frictionless platforms that securely store and move money in real-time without intermediaries, in order to reduce the cost and risk of payments. Consumer Payments Analyst Nicolae Bacila spoke with Laurence Cooke, Founder & CEO of nanopay, about the value proposition of its technology and services for both consumers and businesses.

Could you give me a bit of background on nanopay?

Founded in 2012, nanopay is a fintech company based in Toronto that provides a unique payment platform that powers multi-currency payment solutions with instantaneous settlement. In December 2015 nanopay acquired MintChip, a digital currency platform developed by the Royal Canadian Mint. nanopay launched the first commercial deployment of MintChip in June 2016, allowing Canadians to send and receive digital cash to and from friends for free through secure P2P payments.

Could you tell me more about the products you offer to financial institutions?

nanopay has built a payment platform that powers a broad range of solutions, including cross-border payments, B2B payments, and digital cash.

Cross-border payments allow real-time transfers, a 60–70% reduction in cost compared to other solutions, an automatic process, and a reduced need for liquidity in correspondents. B2B payments enable companies to send payment requests to customers and make payments to vendors securely, allowing them to control cash flows and make payments without having to exchange sensitive banking information. Finally, banks have the opportunity to replace physical cash with digital cash that can be issued, stored, and transferred with instantaneous settlement, bank-grade security, reduced costs, traceability, as well as privacy.

Developers can build payment solutions that integrate the nanopay payment engine using nanopay open APIs. This enables banks, payment service providers, and businesses to instantly store and transfer digital value between parties without intermediaries. The platform features cryptography with advanced security that can be deployed in the cloud or on-premise.

How is nanopay different from other competitors in terms of security and scale?

Compared to using credit cards or even PayPal, the nanopay platform offers the certainty of payments, eliminating the risk of fraud or the possibility of revoking payments after transactions have been made. In addition to offering greater security and predictability to both consumers and businesses, the nanopay platform can support up to 140 million transactions per second, which makes it significantly more scalable than other competitors’ platforms that can support around 50,000 transactions per second.

How is nanopay different from blockchain technology?

While blockchain-based transactions are based on consensus algorithms (requiring each party to have a copy of the other parties’ transactions), thereby taking a longer time to process, the nanopay platform is faster and more secure. The messages that are being sent on the platform are cryptographically signed and can only be accepted by the specified receiver. Therefore, the nanopay platform can send payments over unsecure channels, reducing the underlying cost compared to blockchain technology.

Where do you see the biggest opportunities and challenges in the future?

We believe that regulatory barriers and compliance are both a major challenge and an opportunity. While the fintech revolution should lead to lower barriers to entry on the market, it is also essential to reduce fraud and counteract money laundering and terrorist-financing efforts.

Banks’ legacy payment systems often struggle to keep up with the rapidly changing regulatory landscape, as well as with markets with low developed payments infrastructure. The nanopay ecosystem ensures that each transaction contains the rich supply of data necessary to meet the regulatory requirements of a given country, reducing the compliance burden on the participants present within the ecosystem.

By Nicolae Bacila, Consumer Payments Analyst

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