Episode 8: Darryl Cumming, Agreement Express/NMI

Greg Myers: Hi, Darryl, and welcome to this episode of the Leaders in Payments podcast, where we’re going to do a deep dive on what happens before the transaction. Welcome to the show.

Darryl Cumming: Thanks, Greg. Excited to be here,

Greg Myers: Great. Let me set the stage a little bit for our conversation. Agreement Express is an underwriting and onboarding software solution and it was acquired in December of 2022 by NMI. Today, we’re going to be talking about the functionality and value of having a robust solution for underwriting and onboarding. Before we dive into that, would you tell the audience a little bit about your current role at NMI, a little personal and career background, about how you got there. And let’s start there.

Darryl Cumming: Yeah, of course. Thanks, Greg. My name is Darryl Cumming. I’m Director of Product Management at NMI. My specific focus and my true passion is around any products related to merchant onboarding, to risk underwriting automation, ongoing merchant portfolio risk monitoring and merchant life cycle management, including processor reporting, residuals, et cetera. These are all things that touch a number of our products mainly Agreement Express and IRIS CRM and that we just add significant value to the industry went through the NMI group. Now I came into the NMI family through the acquisition of Agreement Express, as you mentioned, in December 2022. I’ve been at Agreement Express for around eight years now. Before that, I was actually a customer of Agreement Express for another seven years where I helped build the first digital account opening solution for private wealth management banking in Canada. I go back nearly a decade and a half with Agreement Express as a company and it’s been a heck of a ride. In my time working at Agreement Express, we’ve gone through three acquisitions. We had very innovative products in two separate FinTech industries wealth management and payments. Well, with the NMI acquisition, that’s no longer the case. We are now 100% focused on payments, and that is truly what I’m passionate about is anything onboarding, risk automation, anything to do with payments and those verticals I’m very keen to discuss today.

Greg Myers: Okay, great Thanks for sharing that. Let’s go ahead and talk about Agreement Express. Let’s start at the 50,000-foot level. Tell the audience what it does.

Darryl Cumming: Agreement Express is the world leader in automated risk underwriting and merchant KYC know your customer and KYB know your business monitoring for the payments industry. So, whether you’re in the risk-bearing space meaning you underwrite merchants, or you’re thinking about starting to you can use our ScanX tooling, our KYC and KYB risk automation tools to help put your organization on another level. Maybe you want to grow your revenue or maybe you’re looking to differentiate your business, maybe you want to compete with the biggest players out there. Agreement Express and NMI is providing solutions to help you automate risk underwriting solutions, and this is the key to being able to compete and to grow revenue in some of these areas. Now you can ask any of our partners when they implement our ScanX product, they get their risk team up and running. They’re going to be working eight times faster, 10 times faster, and you’re going to be automating more decisions than ever before. Putting your risk team in a position to adapt and win is what we’re all about Now even if you’re not risk-bearing, we have a number of partners who are utilizing ScanX to run prechecks before submitting merchants to sponsor banks, so faster sponsor bank approvals are commonplace when you’re using a robust tool like ScanX. Not only is the confidence of your internal teams and partners going to significantly increase, but your sponsor banks are going to immediately recognize that you’re playing chess while a lot of the industry is still learning checkers. So that’s a little bit about what Agreement Express.

Greg Myers: What makes it different or unique in the marketplace.

Darryl Cumming: Yeah, so our ScanX and MonitorX products are really all about speed, compliance, modularity and choice Our ScanX and MonitorX products are built in collaboration over nearly a decade with the biggest names in the game. I’m talking about major card brands, sponsor banks, ISOs, large software platforms, payfacs you name it. They’re all using an X and winning and been doing it for years now. We’ve got a massive library of integration partners and we’re frequently adding more to the library. And what you get with ScanX in addition to being more compliant, being faster, putting your underwriters in the position to succeed and protect your business. Well, on top of that, there’s this network effect taking place.

We’re constantly reinvesting in the product. We’re constantly adding new risk rules, new tools for you to get faster, to be more efficient, to stay more compliant, giving you detailed audit logs. I can go on and on and, honestly, if you try and build something like this yourself or go work with a competitor who just doesn’t have as robust of a solution, I often expect to see those companies back a year or two later looking for a better solution. And ScanX is the one that is typically top of mind and being referred frequently throughout the industry.

Greg Myers: For clarification ScanX is sort of both the underwriting and onboarding, or is that just underwriting?

Darryl Cumming: Yeah, great question. I should clarify that. So, we kind of have two flagship products. When it comes to risk automation, ScanX represents our initial underwriting risk decisions. So when I say initial underwriting, I’m referring to signing up and risk reviewing a merchant before you’ve accepted them to start accepting card payments and ensuring that they meet your criteria there within the requirements of your sponsor banks and adhere to card brand guidelines. There’s no violating content or anything out of place on their website all kinds of different things we can go on and on. That’s all related to ScanX. So, approving a merchant to begin card processing. When I refer to MonitorX, we’re talking about somebody who’s already being approved to join and be part of your portfolio. So your existing merchant base, staying on top of those merchants to track things like their adverse media findings. Are they popping up on for potential violations or actions against them or lawsuits or criminal record activity, whatever it is, or it can also be monitoring their business websites or other things along those lines. ScanX for new merchants, monitorX for your existing portfolio and ensuring that they are staying and adhering to your expectations for merchants within your business.

Greg Myers: So, you’re talking about some of the challenges that other companies that use your tool have. What are some of the challenges they have if they don’t have a tool like this?

Darryl Cumming: Yeah, well, I mean people working with their own home-grown solutions are using spreadsheets and Word docs or whatever it is they’re doing to underwrite manually today. Often they’re facing the same set of problems and even working with some of our competitors. You’re going see a lot of these problems, whether it’s incomplete data coming from sales to the underwriting team and causing delays in your process, constantly having to go back and forth where your risk teams going back to a sales rep or to a partner or directly to a merchant and it’s just not an ideal process to get merchants up and on board efficiently and quickly. Just manual and repetitive tasks. You can talk to anyone in the underwriting game and they’re rinsing and repeating what they’re doing all day long, week after week, year after year. It’s hard to keep it exciting, but I like to think that our product really helps put these people in a position to succeed, to not be missing things. One of the things that I constantly refer to is how our product is never hung over. It’s going to help your team underwrite the same way at nine o’clock on a Monday morning and at four thirty pm on a Friday afternoon. Just inconsistent processes as well. So typically you’ll have manual escalations or certain reviews that need to take place in certain scenarios, or some underwriters decide to underwrite a business. One way you can look at a different merchant with a similar profile week before and if a different underwriter looked at them, maybe they took a different, completely different approach to underwriting that merchant. Using our products, going to ensure consistency across your platform. A lack of audit logs another area that a lot of people struggle today, and Agreement Express offers a world class solution that auto logs everything you can imagine, whether it’s updating your risk models or all of the actions that an underwriter takes along the way to get a merchant to approval or to decline status. Do other things as well that come to mind, things like changing guidelines for risk. I mean, the underwriting is constantly evolving. We’re constantly learning about fraud trends. We’re always learning about new requirements, new regulations that we need to follow, and those can come from anywhere, and it’s hard enough staying on top of those. It helps being in an organization like ours, where this is what we’re focused on, this is our bread and butter and what we do, and we’re able to help share some of those learning, share with our customers what’s coming down the pipeline and really help everyone grow together and that’s one of our major priorities. And inability to identify and stay ahead of fraud trends is something that I commonly see. Having a lack of visibility into your underwriting efficiency and application statuses these are things that just come out of the box with a product like ScanX. Also, the last thing I’ll touch on is just like slow merchant journeys in general typically leading to merchant abandonment. Every minute, every second, every day or hour that it takes you to get your merchants on board and approved for payment processing. There are risks of going somewhere else signing up for a competitor, signing up for some very simple payment solution where they’re paying much higher rates, but if they can get a quick solution and be approved in a couple of minutes, well, it’s pretty hard to compete with that. Even so, to top it off, I mean a lot of companies like Stripe and Square eating the lunch of many of your classic ISOs in the industry today and other merchant acquiring solutions. Well, our product helps you compete and really get on a level playing field when it comes to merchant approval times, auto decisioning, percentages and just ensuring that your entire onboarding and sign-up experience is as accommodating and still protecting your business on every level.

Greg Myers: Well, let’s peel the onion back and go a little bit deeper and let’s start with underwriting. And you mentioned it and I think you know people in this industry know that speed is important, right? What are the things like you just mentioned, people, they may be even willing to pay more if they can get up and running faster, but we know speed is important. But maybe explain exactly what happens and why is it so important to your customers that they get this right?

Darryl Cumming: Yeah, you said it right, Greg, speed is king, king or queen, however you want to approach it, and every extra minute that it takes a payments organization to on board a merchant and get them actually processing payments, it’s time that you’re at risk. They might sign up for a competitor solution or abandon their application, they might change their mind or start thinking of different questions. It just leads to friction across your entire organization. So, I make a point of connecting with sales reps, with our partners, when I see them around the trade show circuit, and there’s one trend that I always notice and that’s that the friction between underwriting and the rest of the organization is always at a high. But I find that as people work with ScanX and Agreement Express more often, that friction starts to decrease and it’s once ScanX is implemented and underwriters are making faster decisions, they’re being more consistent. That just builds and it’s the relationship with your sales organization, your partner channels. Again, we’ve got all kinds of customers who are using their different partner channels to refer business and get them on board and being able to support unique requirements across partner channels. It becomes a way for you to entice new partners to work with your eyes or payments organization by showing them that you got best in class tools for underwriting. You’re going to be consistent, that you regularly approving merchants in very short times. That’s something that makes a partner want to work with your business, whether it’s a software partner, whether it’s a sales organization, etc. But ScanX isn’t only about fully automating merchant decisions, though it’s obviously one of the major benefits. Sure, we want to automate the very best and we want to automate the very worst decisions where possible, those merchants that are just no brainers. They’re really green or they’re really red. It doesn’t take a trained and veteran underwriter to dig in under the hood and make those decisions. However, there’s this gray area in the middle, these merchants where we might be leaning towards the green side, we might be leaning slightly towards the red side, but these are the merchants where it’s truly time to shine for your underwriters, and that’s the real bread and butter. So ScanX puts your underwriting team, your risk team, in a position to be truly excellent when it comes to these decisions that can really make or break your business. You’re probably not going to get in trouble because you auto approved your very best merchant or you auto declined someone with just credit that you know you don’t want to do business with at all. We come with all these tools, the ScanX product and things like recommendations to your underwriters, where you can use our default recommendations that come into effect for low credit scores or when we find high risk content on a website, and so on. But you can also customize those to whatever you want, ensuring that your latest risk guidelines and practices are reflected immediately in the application to your risk team when it matters, when certain flags are being triggered. Beyond that, things like risk model performance analytics that put your managers on just another level that doesn’t exist anywhere else in the industry. Whether your risk managers are newer to the area that maybe they’re better than underwriters, but new in the management space, or maybe they’re a veteran who’s just been doing this day and day out for twenty, thirty years, who knows? ScanX is something that I can see appealing to all of these different personas and really just putting people in a position to grow their team, grow confidence and produce results that are going to have the whole business turning heads on wanting to know well, how did this team just turn it around so quickly? Well, we can put data in your hands to help you really get under the hood and understand what’s going on with your risk models, with your decisions, with your team efficiency and much more. Last thing I’ll touch on as well about on the speed front is just the use of different risk flags. So we’re trying to automate the very best and the very worst and we don’t want people looking at those applications. Where possible, we want to just auto approve them in a matter of minutes or seconds. There’s scenarios where underwriters do need to get under the hood. They need to look at where are the risks in a particular merchant application. So ScanX is really good about putting your team in a position to quickly identify which risk flags require their attention, being able to tweak and hone in, collaborate with different people on your team and just make sure that Everyone has what they need at their fingertips. They’re not distracted by things that didn’t trigger risk flags and they’re focused on x, y and z the key items they need to address in order to get that version to prove this quickly as possible.

Greg Myers: Okay, so similar question, but now about onboarding. How do you define that and why is it so important?

Darryl Cumming: Yeah, well, onboarding is important because it’s really the life force of most companies in the payments industry. You want to grow your business. You need to onboard new merchants. So onboarding I like to think of as really everything from initial sales activities, scoping out, finding these merchants, everything from merchants sign up through to payment processing. As soon as a merchant is processing, the onboarding journey is done. There’s still all kinds of commitments that you have to those merchants, but once they’re accepting payments through their website or mobile app point of sale terminal, through their phone, even unattended payments, that’s when the onboarding journey is complete. Now, why is it so important? Well, there’s all kinds of reasons why onboarding is imperative in the industry for you to be successful with and some of those reasons are again, indirectly, for you to be successful to grow your partnership channels, for your sales team to be out there boots on the ground or emailing merchants trying to get new leads for your organization. The confidence of having a smooth and efficient underwriting process will feed through to the rest of your organization from the top down. So you’re going see your sales team out there and they’re going be there gunning for new merchants all the time, and they’re going be a lot more confident that those merchants are going to get approved or that they’re going to have consistent feedback in the event that they need to collect some more information, provide more documents or something else. So, at a high level, I think that’s the sum of what onboarding is, and it’s really just so important to our customers because if they want to grow their business, key way to do that is either acquire another business and get their portfolio or find a way to board new, new merchants to your payment processing solutions.

Greg Myers: You’ve talked a lot about partners and we’ve mentioned ISOs. Who exactly and maybe if you can dive deeper into the types of organizations and the people within organizations but who are these tools built for? Who actually uses them? Who do you sell them to? You know as much details you can about, about sort of the profile of the clients.

Darryl Cumming: Yeah, of course I wish there was a simple, small answer for you, but the answer is it’s all over the map. So, you’ve got your standard ISOs and your standard ISO might be risk bearing or they might be retail or non-risk bearing and so when you’re a wholesale risk bearing ISO, then you’ve brought underwriting in house. That’s one of the key things that makes you obviously risk bearing. So that is typically one of our historical key markets and that’s an area that we have tons of partners. We work with a number of large ISOs in the game, a number of the top ones out there, even down to some of the smaller new ones. Now, when it comes to retail ISOs will get to that in a second. Typically they’re not doing their own underwriting, but increasingly we do see retail ISOs who are coming to agreement express and wanting to do some sort of pre checks before they send Applications to their acquiring sponsor bank. Now the reason they’re doing that is because it’s going lead to faster turnaround from their sponsor bank and they’ve got more confidence that their merchants are going to be approved and that Is important to them because they want still the two for there to be a really sound and pleasant experience for these merchants when they’re onboarding and signing up. So, by doing these initial checks, rather than going to the sponsor bank and waiting a day or two or at least multiple hours for a response, they might catch certain things and be able to go back quickly to that merchant and get that information before submitting it to the bank. Now we do work directly with acquiring sponsor banks as well. Often in these cases there what is often referred to as shadow underwriting. So a lot of cases they’ll have an ISO who’s doing their underwriting already because they’re a wholesale ISO, and when it goes to the sponsor bank they’re then doing some additional checks on top of that. And scan X is just great because these different acquiring banks can set up different risk models for their different ISO partners. There might be different checks that they’re doing for one channel versus another and they can really tailor the entire experience to their needs. Now, payment facilitators, another area that is growing. You’ll see these software platforms who are taking on some elements of the payment facilitation process, whether that’s the underwriting, whether that’s only some more of the settlements and things like that. So that’s another area that we often see partners, and then, of course, you’re one of the biggest growers that the software platforms. The software companies typically vertically focused, so they’re focused on a single industry, though we do work with some horizontal ones as well, and increasingly these software platforms are wanting to either do pre checks or they might be even starting to take on some of the risk themselves, and so ScanX is a very good fit for them. Now, getting out of kind of these classifications of different organizations in the payments industry, I would say that really, when it comes to different types of underwriters, different levels of experience, that are ScanX and MonitorX products very much appeal to everybody, from the novice all the way up to the industry veteran or wizards out there. It’s a common misconception that product like ScanX because it’s so robust, because there’s so many levers and tools you can pull, so much configuration you can do, that it’s not ideal for a new green underwriter, it’s only for those more experienced people in the risk space. But, to the contrary, some of our biggest success stories have been companies who get scan X implemented early. ScanX implemented early, it becomes a conduit for you to help grow your revenue, grow your partnerships, establish better partnerships and grow those relationships and better relationships with sales, as I spoke to earlier, by putting your underwriters in the pole position. I mean, I mentioned earlier ScanX is never hung over. It’s built to put your team on another level. Give your team a chance to succeed in you’re going to see amazing thing come out of it and I have use case after use case of partners implementing this, whether they’re new into underwriting, whether there is advanced as it gets, and it just puts people on another level regardless. You see some of these newer green underwriters that the novice is out there who are there still learning the ropes and getting so many of our default settings walking through our team, who have just lived in brief underwriting automation for the last decade, helping them, teaching them about some of our best practices, some of our findings and learnings from the past decade. It just starts to make them more comfortable and we’re happy to foster and build those relationships and continue to check in, help these newer underwriters and offices understand the data that they now have access to and how to tweak their models and increase automation or just really make it their own. And then you’ve got your, your advanced industry wizards or veterans and these people I mean you can tell that they just eat, sleep and breathe underwriting like I do myself a lot of the time and you wonder how they’re possibly going to be on another level because they just seem to know it all already. But you get some of these veteran wizard underwriters into ScanX. You put them under the hood to see the performance analytics of their different team members and to see detailed reporting of exactly which risk flags are triggering, frequently for different partner channels or for different acquiring bank channels. It just gives them a breadth of knowledge and information that they didn’t have before, and it’s incredible to see how they take that and run with it. So, I think this tool is built for really so many different areas of the payments industry, but when it comes to risk analysis, it’s not for a specific person, whether you’re a novice, whether you’re a veteran. I think the product is really made to help both levels succeed in anyone in between those.

Greg Myers: Okay, makes sense. We talked earlier about some of the challenges that these companies have if they don’t have this kind of solution. So now let’s flip the question and talk about why is it so important for these ISOs and these payfacs and sponsor banks, why is it so important for them to have this functionality?

Darryl Cumming: Yeah, well, I mean, I encourage anyone to go take a last search on the Federal Trade Commission website and look at some of the fintech and payments related actions that are taking place. And I don’t want to say they’re on a warpath, because I love the FTC, they’re protecting us, but they’re taking this pretty serious. Right now there’s been a significant number of actions against small players and large players in the payments industry. We’re talking about potentially hundreds of millions of dollars and fines, not just from the FTC, but looking at things like OFAC and AML and sanctions violations. I think the key thing is, once you lose your reputation in this industry, it’s so tight-knit, everybody knows one another. Well, good luck from there. If your reputation is gone or you get an action like that against your organization. These things don’t exactly fly under the radar now when we talk about why is it so important to have this functionality? Well, avoiding those fines and potential regulatory issues is one major reason, but it goes much further than that being able to protect and grow your business, whether it’s tools for compliance, whether it’s underwriter recommendations in our app, whether it’s our world-class audit logs that just give you the compliance, the compliance backing that you know you need to have to be in this industry. Our fraud detection and monitoring tools, checks all the boxes that are going to protect your business from fines and potential fraud violations and not to say, a fraudster is never going to sneak through. I mean, nobody can ever tell you that, but we give you every tool possible and we give you even more tools to prevent it from happening a second time, whether it’s things like our negative file functionality, where you provide us with key pieces of data, or we can even automatically update the table for you based on certain declines and risk factors, so that if you see a fraudster trying to apply to your business Well, we can pick up key pieces of data from that application and if we see those coming back again, we’re going to give you huge cost savings because we’re not going to rerun a credit check on someone. We’re not going to crawl a website when we know that, oh, this is data that has been associated with fraud in the past. Now, growing revenue is another reason why I think it’s so important and we talked about the FTC being on a mission. I mean that obviously has a huge impact on revenue if you’re getting hit by fines, but giving confidence to your partner channels, giving confidence to your sales organization, showing them that you can be consistent, that you can decision merchants quickly and when you do need to go back to them which annoys every salesperson partner in the world because you need more information or you need to clarify something with a merchant doing that consistently in a way that they can predict. It helps build a bond between your two teams and I mentioned before like there’s always seems to be this conflict between the sales organization and the risk side of the business, and one of the things that I think ScanX is really good at Is just helping to normalize that and put that relationship into a better place, which is a major impediment, if you’re not able to do that, from preventing your business from going as it should be.

Greg Myers: Okay, well, Darryl, we have covered a lot of ground so far. Is there anything else you’d like to add before we wrap up the show?

Darryl Cumming: I guess I want to give a big thanks to our integration partners, and there’s too many for us to name right now. But we’re lucky at Agreement Express and it’s growing through our through having the NMI brand behind us, but we work with the biggest names in KYC and KYB data verification, whether it’s credit checks, bank account validation, web crawling tools and much more. ScanX is trying to take not trying. We are taking this to a kind of a new math. Let’s say we’re one plus one plus one, instead of equaling three, it might equal eight in the future. And as we continue to add new integration partners, as we continue to integrate and build connections to tools like IRIS CRM, another NMI tool. Again, you might question my new math, but when your team’s leveling up, they’re getting comfortable with ScanX and they’re putting it into practice, you’ll wonder how you ever survived without it. Now, another thing I’ll add is that our MonitorX. So, we didn’t talk a lot about MonitorX, but that is our post merchant approval. So, merchants in your portfolio, we offer a low-cost solution for checking things like adverse media. You want to know if there’s negative findings in the news for a business that’s in your portfolio or for the owners related to that business, ongoing checks against things like OFAC and anti-money laundering and sanctions lists. We talked about the Federal Trade Commission earlier being able to monitor to see if your merchants are popping up, if they’re being served with actions by the federal trade commission or they have even high-risk website content violations. We have the best-in-class tools from our partners at KYC site scan. I will name one partner here who just they’re able to crawl these websites and scan for thousands of words in a matter of minutes and it would take your underwriters days to try and do this to the same level or to do it accurately, and they would probably make a number of errors along the way. It’s not because I don’t have faith in underwriters, it’s just. This is mind-numbing repetitive work and to be able to automate parts of this and do it in a couple of minutes. It’s something that we’re just lucky to work with so many great solutions and so many great partners, and we have this continual investment to the product and being part of NMI has really helped that a lot. Couple other things. I don’t think we hit on significantly, but you’re going to see a lot coming out of Agreement Express in the months ahead for Getting cost savings for our partners. So, anyone who’s working with us, who’s signing up for ScanX and using MonitorX well, we’re going to be doing everything we can to put money back in your pocket and there’ll be more to come on this very soon but we really appreciate having the trusted partners that we have today and the time they take to help us grow the product. The feedback they give us and one of the ways that we’re excited to give back to them again is through doing everything we can to give them return on investment and cost savings through using our product. Lastly and I promise this is the last one is our integration with IRIS CRM. We’ve got some incredible work underway right now. Obviously, IRIS CRM was acquired by NMI roughly 18 to 20 months ago and Agreement Express was acquired just last December, so about eight months ago. Well, these two products are coming closer and closer and you’re going to be seeing more and more synergy between Agreement Express and our underwriting automation and our MonitorX monitoring tools and IRIS CRM, which is just the best payment crm system in the industry today. Nothing touches it and it is just built for the payments industry. So, if anybody has not seen IRIS CRM. If you haven’t seen Agreement Express and you want to get under the hood of these two products, learn more about how they work closely together, don’t hesitate to reach out to our team anytime. We’d love to get a demo set up for you.

Greg Myers: Yeah, and I think one of the reasons I wanted to do this series that I’m kind of using air quotes around before the transaction. I think there’s a lot of people in payments who take for granted the all the things that have to happen before money ever moves, and I think obviously Agreement Express and IRIS CRM and NMI, it’s a component of what you do. It’s not everything you do, but I think it’s important. So we’re digging a little deeper in these podcasts to explain some of these things and the value of them and, you know, go into your tools and how they work. So, Darryl, I really appreciate you doing that today and, you know, thank you so much for coming on the show and explaining all this and such a great detailed level and you made it very clear and understandable for everyone. So, again, thank you so much for being on the show today.

Darryl Cumming: Hey, no problem, Greg, Thanks for having me and I’m excited to keep following up with the series. It’s a really good thing you’ve got going on here with the Leaders in Payments Podcast and excited to be a part of it.

00:02:21 – About Darryl Cumming

00:04:15 – About Agreement Express

00:08:27 – Challenges ISOs Face

00:12:07 – Details About Underwriting

00:18:55 – ScanX Customer Profile

00:24:47 – Advantages of ScanX

00:30:58 – Integration with IRIS CRM