Dive Brief:

• Account-to-account payments provider Dwolla appointed financial technology and payments veteran Lawrence Herman as its CFO, the company announced in a Thursday press release. It also tapped industry executives Alka Gupta and Millicent Tracey as new board members
• Herman and the two newly appointed board members will leverage their combined experience in the payments space to help drive growth and innovation at the Des Moines, Iowa-based embedded payments company, Dwolla said in the release.
• Herman has experience in the cryptocurrency, bank and card network industries. He joins Dwolla from the machine learning company Accrete AI, where he served as CFO and interim CFO for two years.

Dive Insight:

Dwolla’s new leadership follows the company posting 45% growth in its partner ecosystem for Q1 of 2023 in April, including the addition of new companies, such as data aggregator Flinks, the company said. Dwolla CEO Brady Harris attributed part of the jump to “surging demand for powerful payments solutions paired with recent advancements in faster payment technologies,” per an April press release.

Herman and the two new board members will be taking on their leadership roles as Dwolla looks to capitalize on the growing momentum of the A2A payments space — a method of payment that enables transactions to flow directly from one account to another, such as a consumer’s account to a business or from a merchant to another business.  

Herman’s previous roles include a stint as SVP, head of finance for global cryptocurrency platform Paxful — where he drove 60% in annual revenue growth in his first year, according to his LinkedIn profile — as well as director of financial planning and analysis for AI platform Dataminr. Herman has also logged time in financial roles for Big Four accounting firm EY, card networks Mastercard and American Express, and at banks Citi, Morgan Stanley and Goldman Sachs.

Herman’s “financial expertise and leadership will be instrumental in driving our growth and optimizing our operations,” Harris said in an email, pointing to the opportunities of the expanding A2A payment space. Dwolla has a total addressable market of over $77 trillion, he said. 

Both Gupta and Tracey have also logged extensive experience in payments, with Tracey serving as board director for the California Bank of Commerce as well as spending time as a digital payments advisor for Nacha, according to her LinkedIn profile. Gupta, meanwhile, has an extensive background in fintech, payments and marketplaces, according to Dwolla.  

The expansion of real-time payment networks helped to push forward A2A payments growth last year, with such payments accounting for $525 billion in global e-commerce transactions for 2022, according to a March report by FIS. There were nearly 70 such networks that helped to push A2A payments up 13% from its 2021 total of $463 billion, FIS said in the report.

“​​​​​We recognize the transformative impact of real-time payment networks on the payments landscape,” Herman said, noting the company remains at the forefront of the A2A payments space. “We are prepared to adapt to industry shifts and ensure our customers derive maximum value from the evolving payments landscape.”

The rise in usage of A2A payments comes as many companies in the industry gear up for the launch of the Federal Reserve’s FedNow real-time payments system, which will compete against the Clearing House’s RTP network. First launched in 2017, the RTP network reaches 65% of U.S. demand deposit accounts, according to TCH.

Prior to the planned launch of FedNow this July, over 120 companies have signed up to aid in development of the network, including payment processing company Jack Henry — which has over 20 of its client financial institutions set to go live with FedNow between late July and August, CFO Dive sister publication Payments Dive reported in early May.

Dwolla was an “early adopter and supporter” of the RTP network, Harris told CFO Dive in an email, and is also featured in the Fed’s FedNow Service Provider Showcase, which focuses on helping to prepare businesses to adopt the network.