What’s So Special About PayPie Tokens?

Every now and then I get this question from new comers to the financial blockchain scene. They’ve just found PayPie and they’re not sure if they’ll go through our whitepaper to get the whole picture of the value behind PayPie tokens, so here’s a quick explanation on one of the main sides of becoming a token holder.

First of all, let me just state what PayPie is all about. PayPie brings ultimate trust and transparency to the financial markets by introducing the world’s first credit risk assessment based on blockchain accounting. The platform solves the problems of fraud and inconsistencies which exist in isolated accounting systems by allowing for real-time audit and analysis of financial statements on the blockchain. By looking at the risk score analytics, you will be able to make a sound judgement on what to expect from the companies that you are going to buy the invoice from.

Smart contracts on the blockchain are pretty new and have opened the door for this global opportunity. Anyone from anywhere can finance the invoices of businesses using international credit ratings on PayPie’s marketplace. When we presented the PayPie at the Accountex USA event early this month we could see that hundreds of minds were being blown away by the disruptive structure of the platform.

How big is the market opportunity?

Fire the bank

Though I can’t comment on the specifics, let me share some pertinent information on a few regional markets. In the USA and Canada, we get almost 0% return for any deposits in the bank. This is a screenshot of Bank of America’s website showing a pathetic 0.01% return over 12 months.

But if you, as a business, go to the same bank for credit, they would charge you anywhere between 6% to 14%. We will bring exactly this kind of business to PayPie so that you can help fund other businesses while being rewarded for your efforts, essentially replacing banks for that matter. Conventional invoice factoring companies in developed countries charge around 2.5-4% for a 30 day credit and sometimes the origination fee can make the entire process inviable.

But this situation can be even worse in many other parts of the world. In Brazil, for instance, the ongoing rate can be anywhere between 8% to 12% per month. Same can be said about India, Philippines and most of the countries worldwide. We will strive to become a platform of the choice for businesses from these countries because we will able to facilitate cheaper loans by connecting with token holders who have poor yield in their own countries. PayPie will handle KYC and regulatory issues and will ensure you finance businesses with empirical evidence of stellar financial health. I keep hearing from experts from all around the world that there is no better way to make informed decisions and to identify great investment opportunities. I completely agree.

Invoice financing is a 3 trillion market today and we believe that massive wealth will be created globally when smart contracts cut the middleman off the picture. The benefits will be shared by all, from big financial institutions to micro investors, from credit card companies to rating agencies, all will make better and smarter decisions based on live and truly accurate financial data for the very first time thanks to the power of blockchain and PayPie.

 

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Credit Risk Assessment on Blockchain Accounting

Hello financial world! The PayPie team is excited to announce that we now have an official blog to share all news, press coverage, important dates, and all other relevant information nuggets about the platform that’s out there to tell. We’re thrilled with all the buzz that the PayPie vision is creating in the financial scene and we know that there’s plenty of more to come, so let us all be a part of this fintech revolution!

First, let me just clarify a very important topic that often comes on our social channels. I have been asked quite a few times since announcing our token crowdsale: Are you similar to Populous or similar to Xero? For those who don’t know, Populous is an invoice trading platform based in UK and Xero is an online accounting software provider.

I believe this question might arise from the first impression of our whitepaper when you see a marketplace for invoice trading or automated audit functionality built-in that we have for accounting professionals. So let me straightforward with this, though we have the similar functionality but we are very different from both above companies and our vision is much broader. The confusion arise from the fact that no one has seen something like PayPie yet in the fintech but things are going to change pretty soon. We are more similar to Experian or Equifax for businesses. We are more like Slack than Outlook that prefer to sit in a closed environment. Done. Subject clarified. So let’s move on to the really meaty part.

If you are a business owner, you know that world today does not need another accounting software but we do need something that can look at your financial data and do some magic to solve your real life problems. As a co-founder of SlickPie, sometimes I read support emails and do attend support phone calls so that I have firsthand experience the problems my customers are facing. During one of those calls, I had an opportunity to talk to one customer who was very stressed, nervous and concerned. She had a profit making business, there was a payment of more than 10K coming soon and bigger amount was being settled week after but she needed the money today. She tried to reach her bank but they requested more documents before they even consider her request.

She just wished that she can click on a button in SlickPie and because system already knew that her customers are loyal and had been paying her for a long time, she should get the money in the bank so that she can do her payroll and carry on with her business. Unfortunately for her, there was no easy solution that time but it made me to go through many sleepless nights.

I kept on thinking what can be done? We are so close to her business and there is no one who knows better about her business than us so how we can help her and millions of other small and medium size businesses who have less than 500 employees. I talked to the team and we drilled down in the data to see if there are more businesses like that, and to my surprise, results were shocking. We see thousands of businesses were getting their payments as late as 60-120 days and there were struggling to stay float from month to month. The bigger was the invoice amount, longer was the time delay in getting the payment.

We brainstormed over many sessions on how best to help SMEs based on the data we have. During this time, I had an opportunity to attend a meet-up group in Seattle, USA with a friend where an entrepreneur was trying to solve a problem using blockchain. This was a light bulb moment and we started working on a mission to bring the benefits of blockchain to the world of business financials.

Major problem is that even after having so many businesses on the cloud, there is still no easy way for lenders to access & trust financial data to provide required liquidity to them. They still take business data from ERP software in PDFs or excel sheet and then someone enter it manually in the software. This is such a dull, slow and out-dated process and hard to believe that business is still done this way today in 21st century.

If you are a business owner, this is all going to change starting with PayPie because we have all the information about your business that can help solve your liquidity problems. We know your customers, vendors and employees. We know how much is your payroll and which bank or service you use for salary payments? PayPie knows about your bank because you connected it for live bank feeds. How much debt you must pay this month and how much is your installment of the line of credit that you opened with your local bank? You may not know exact figures but your financial software does.

We are analyzing all the above information and many more data points to build an algorithm for the credit score of your business. You can take this information and go to your bank but wait. Why to go to a bank when you can have liquidity right inside PayPie, powered by Smart Contracts? Our token holders will look at your credit rating and can do the same thing that a bank does for you but in a way more seamless, easy and secure way.

Dealing with business financials might be the most boring thing for most people but this is the most rewarding income for banks contributing almost one third of their global income. You as a business owner will not only get quick financing but also overall better rates than banks because there is no agreement fee costing you in thousands. Not only this, the more invoices you sell on the platform, the more accurate your risk score would be as it is continuously updated onto the immutable Ethereum blockchain. One day, you will be able to take this risk score and share with other blockchain applications to access their services anytime, anywhere in the world.

The other main beneficiaries of PayPie would be accounting professionals. They will benefit from the end of duplicate data entry, automated reconciliation and automatic audits. Many businesses spend anywhere from 5 hours to 20 hours per week just reconciling their accounting records. Single Ledger will put an end to this practice and cost reduction will be potentially enormous. Audits will become much more analytical, at least semi-automated, and even continuous, a dream come true for CPAs who charge $300-400/hours for a service like this.

There are many more ways PayPie will revolutionize the world of business financials and I will dive into them some other time. Hopefully, I made it clear what PayPie is all about. If not — reach out to us via Slack channel, or Email and we’ll answer any questions that you might have. Cheers!