Integrating repayment, balance transfer, and bill payment features into fintech applications poses significant challenges for developers. Often, they grapple with unreliable screen-scraping APIs to pull data from users’ financial institutions, or they find themselves relying on cumbersome processes tied to handling physical checks and paperwork.
Three entrepreneurs and friends — Jose Bethancourt, Marco del Carmen, and Mit Shah — shared with TechCrunch that these hurdles can be particularly daunting for smaller fintech teams. In their efforts to address these issues — and assist others in doing the same — the trio founded Method, a platform designed to facilitate debt management and repayment features within fintech applications.
“Jose and Marco encountered the obstacles of financial account connectivity while working on their first venture, GradJoy, a startup backed by Y Combinator,” Shah informed TechCrunch. “GradJoy set out to streamline student loan management, but it quickly became apparent to Jose and Marco how limited the existing account connectivity solutions were.”
Method operates by utilizing consumer credit access protections outlined in the Dodd-Frank Act of 2010. By accessing identity verification data from credit bureaus and telecom companies and merging that with information from core banking systems, Method can gather an individual’s debts and perform balance transfers, bill payments, and payoffs on their behalf.
Fintech developers can seamlessly integrate this technology into their applications via Method’s API. All users need to provide is their phone number.
Since emerging from stealth mode in 2021, Method has amassed over 30 million account connections serving 4 million users, processing more than $500 million in repayment liabilities thus far.
While Method handles an abundance of sensitive information, potential users might feel hesitant. However, Shah asserts that Method only gathers “minimal user data” and does not sell this information to third parties. Additionally, the company intends to establish a user portal allowing clients to manage the data shared with Method’s customers.
Method competes with major players such as Plaid, MX, Spinwheel, and Dwolla. However, many of these competitors depend on systems requiring users to enter their financial account information, which Shah believes can create friction in the user experience.
“Method is aiding millions of Americans on their financial paths while also enabling lenders and fintech firms like SoFi, Aven, Happy Money, and Figure to enhance conversion rates through improved user experiences and engagement,” Shah added. “Users no longer need to repeatedly authenticate for different accounts—once Method collects a consumer’s outstanding liabilities, payments can be made through Method’s payment rails.”
Recently, Method expanded its offerings to include support for credit cards; it powers Bilt’s credit card linking feature, allowing Bilt users to connect their cards to earn points on eligible transactions. In the coming months, Method plans to strengthen its relationships with banking institutions and introduce credit card network integrations tailored for retail and travel sectors.
“Many consumers are hesitant to save their card details or reluctant to invest the time needed,” Shah noted. “Method provides both new and returning shoppers with access to their existing credit card wallet — detailing all active credit cards — simply by entering their name and phone number. This solution grants merchants greater control over the checkout experience and allows for enhanced customer insights across different channels and cards with complete wallet visibility.”
To support this product expansion, the Austin-based Method, which employs 35 staff, secured $41.5 million in a Series B funding round led by Emergence Capital, with contributions from Avra Capital, Samsung Next, Andreessen Horowitz, Y Combinator, and Ardent. This recent investment increases the company’s total funding to approximately $60 million.
Compiled by Techarena.au.
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