SPEAKER_00 0:00

Welcome to SenseChat, the podcast where payments meet personality. From tech trends to legal twists, compliance quirks to marketplace moves. Titty's here to keep ISVs, paybacks, and marketplaces ahead of the curve. Get ready for insights, a few laps, and the occasional compliance gear. Let's dive in and make payments make sense.

SPEAKER_01 0:26

So this week's episode of SenseChat is a little bit different. Today we have Jason and we have Chris, and Steve is in Hawaii.

SPEAKER_03 0:34

Yeah, that really tells you which one of us is making the best life decisions.

SPEAKER_02 0:38

I do think for compliance purposes, we should clarify that SenseChat did not send Steve to Hawaii.

SPEAKER_01 0:44

That is correct. I checked the reports. There is no travel budget.

SPEAKER_03 0:48

I'm still going to be submitting my expenses, though.

SPEAKER_01 0:50

Absolutely denied. Anyways, we wanted to do something a little different today because there's a lot happening in Sunshot and a lot happening in payments. And somehow those two things keep colliding in ways that give us more to talk about every single week. So today we're going to do a little bit of a look back, a little bit of what's coming next, some payments news, and we're finally going to talk about the fact that Sunshot is growing.

SPEAKER_02 1:13

That sounds dangerous.

SPEAKER_01 1:14

It probably is, but we're going to do it anyways. The biggest thing coming in is that we're launching a Sunshot YouTube channel and we're going to start putting out the full video versions of the episode, starting with this one.

SPEAKER_03 1:23

So now people get to see all the things that we hide when all we're doing is editing audio. Wonderful.

SPEAKER_01 1:29

Yeah, exactly. Audio podcasting was nice because nobody knew what was happening on the other side of the microphone, and YouTube has officially ruined that for us.

SPEAKER_02 1:36

And I'm hearing that wardrobe is now a compliance record.

SPEAKER_01 1:40

For you too, absolutely, yes. I'm worried.

SPEAKER_03 1:42

Listen, I've been preparing for this moment my entire life. I've got my bills head, as you can see. It'll be a staple in just about every episode that I'm part of. Go bills.

SPEAKER_01 1:51

That somehow creates more concerns, not less. But seriously, one of the reasons we're at this point is Cynthia Sasse. Cynthia has been helping us with a lot of the marketing strategy around SenseChat. How we position it, how we grow it, how the content works together, and how we stop treating every episode like it's just one piece of audio that goes out into the world and disappears.

SPEAKER_03 2:11

So you're saying we finally have a chaperone? We've got some adult supervision for once.

SPEAKER_01 2:15

Marketing, adult supervision. I want to be very clear that Cynthia is not responsible for anything Jason says on this podcast.

SPEAKER_02 2:22

Great disclaimer, Kitty.

SPEAKER_01 2:24

Very important disclaimer with Jason. But Cynthia has been a huge help in getting us to think bigger about the brand and what SenseJot can actually become. If you're building a company and you're trying to get smarter about your marketing brand content or growth strategy, go check her out at CynthiaSassy.com. And Cynthia, thank you for helping us grow up a little bit. Now, when we started doing more of these conversations, I don't think we fully appreciated how often the best payment story starts with somebody saying, We thought this was gonna be simple.

SPEAKER_03 2:52

That for the most part is the entire payments industry and most of my dating life before I got married.

SPEAKER_01 2:58

It really is. We just did an episode around moving from card not present into card present. And the premise is almost funny because it starts with, we just want to add a terminal as if that's all you have to do.

SPEAKER_03 3:10

Yeah, and just like in marriage, five minutes later, you're talking about kids and houses. No, I'm kidding. Five minutes later in payments, you're talking about hardware, EMV certification, encryption, key management, PCI. The box gets pretty big pretty quickly.

SPEAKER_01 3:25

Which is one of the things I love about these episodes. On the product roadmap, it can look like one little box that says add in-person payments. And in real life, that little box has its own supply chain.

SPEAKER_02 3:36

And its own contracts, responsibilities, support questions, risk allocation, and usually at least one thing that nobody clearly decided they owned until it broke.

SPEAKER_01 3:45

And that's also becoming a theme around here: define who owns the problem before the problem introduces itself on its own.

SPEAKER_03 3:51

Exactly.

SPEAKER_01 3:52

Now we've also talked with companies expanding into the US market, trying to figure out partner selection, settlements, refunds, disputes, reporting, onboarding, and all the things that don't necessarily show up in the first API conversation.

SPEAKER_03 4:04

Yeah, and that's usually because the integration is easy to draw on a whiteboard. The operating model, when you flip the switch on, that's when we find out how things actually work.

SPEAKER_01 4:13

And that's really what I think Sunshat has started to become. We get to take the sentence, we added payments and ask, okay, but what actually happened after that? That's usually where the useful story actually is. And the funny part is those stories don't stay in one lane. A conversation that starts as a product decision can turn into a support problem, a compliance question, a revenue problem, or a customer trust problem pretty quickly.

SPEAKER_03 4:35

Yeah, that's because payments is an entire ecosystem, not just a button. The API is one part of it, but at the end of the day, you're moving real money. There's real risk and hardware in some cases, dependencies that the customer never sees all have to cooperate and work together at the same time.

SPEAKER_02 4:53

And usually several companies are involved, which means several different definitions of who owns what. That's where it gets interesting because the customer doesn't care which agreement says whose fault it is. They care that the payment worked, the refund showed up, and somebody answers the phone when it doesn't.

SPEAKER_01 5:08

And that's probably one of the biggest things I've learned from doing this. From the outside, humans can look like this tiny, narrow specialty. But when you actually get into it and realize it touches basically every part of the customer experience, once money starts moving.

SPEAKER_03 5:22

And that's why stories keep finding us from all aspects of the payment supply chain.

SPEAKER_01 5:26

And that's apparently why I can't have a normal conversation anymore without someone explaining interchange or merchant monitoring to me.

SPEAKER_03 5:33

Come on, kitty. Our lunch conversations are totally normal.

SPEAKER_01 5:36

Yes, very much. I'll take another beer. And while we're doing all of that, payments itself is not exactly giving us a quiet week.

SPEAKER_03 5:42

Hey Kitty, this is where I'm gonna make my proposal again. She hasn't even made it, Kitty.

SPEAKER_01 5:46

I don't care. No.

SPEAKER_03 5:47

Listen, I've been saying we should do a daily Sense Chat podcast, only three to five minutes every day. Well, just Mondays through Fridays. And all we're gonna do is talk about what happened in the last 24 hours. There's infinite material. Here's why that matters. Goodbye.

SPEAKER_01 6:03

No, Jason, I have a life outside of payments, and I would like to keep it.

SPEAKER_03 6:06

I I can certainly fix that for you.

SPEAKER_01 6:08

No, this is specifically the part I'm trying to protect. We're good.

SPEAKER_02 6:12

I would like the record to reflect that Kitty has rejected the daily podcast proposal.

SPEAKER_03 6:16

For now, but everything's negotiable.

SPEAKER_01 6:18

Don't make me call Cynthia on you. But the annoying thing is Jason almost actually has a point because look at just the last couple of weeks. We covered the FTC's action involving New Bay, where they alleged that the processor opened and maintained accounts for merchants it knew or should have known were engaged in deceptive activity. The settlement includes 4.85 million and requirements around merchant screening and monitoring.

SPEAKER_03 6:42

And the bigger payments lesson here isn't really just about the settlement amount. We all know money grows on trees and payments companies. It's a reminder that underwriting isn't just a one-time gate. You don't get to just approve the merchant, turn monitoring off, congratulate yourself, and head straight to the casino. It's an ongoing exercise.

SPEAKER_02 7:00

That's right, Jason. The responsibility question keeps going after onboarding. What are you monitoring? What are the escalation triggers? Who has to act? What happens when the data starts telling you something you don't want it to tell you? You run.

SPEAKER_01 7:14

And just to be clear, we're not trying to button every enforcement case into the same story. The facts matter, the allegations matter, and every case is different. But when two payment processor actions land that close together, it's hard not to notice the operating theme underneath them.

SPEAKER_02 7:29

That's the right way to look at it. Don't jump from an allegation in one case to the universal legal conclusion, but do ask what the enforcement action is telling you about the controls regulators are looking at, the screening, the monitoring, the escalation, and whether warning signs actually lead to action.

SPEAKER_03 7:46

I'm really good at seeing the writing on the walls and the payment space. And this is a trend that I think is going to just continue to evolve. From a system standpoint, that turns into a very practical question. Can you even see the warning signs? Right? Does your technology support you being able to detect things that don't follow the patterns that you expect? Can somebody tell when chargebacks, complaints, transactions, or account changes start moving in the wrong direction? Or are you waiting on card brand fines or regulators to show up at your door to be the ones who tell you there's a problem?

SPEAKER_01 8:22

And I think that's a very sense chat way to ruin the phrase. We have monitoring. Okay, what monitor? Who sees it? What happens after this? And then just a few days later, the FTC announced another action involving humble merchant services. That one included $12 million and restrictions around processing for certain higher-risk merchants. And again, the FTC's allegations centered on what the processor knew, what warning signs existed, and what happens after merchants were already in.

SPEAKER_03 8:49

Which is why we've now been able to publish multiple things in a row, basically saying, hey, merchant monitoring matters after approval. And more importantly, if you're a payments company, you can't turn to blind eye in the high-risk space just because it's lucrative.

SPEAKER_01 9:06

I don't know why we don't get more party invites, Jason.

SPEAKER_02 9:09

I guess it depends on the party, Kitty.

SPEAKER_01 9:10

The payment compliance party is still not a party, Chris.

SPEAKER_03 9:13

I disagree. I know a lot of people that would love to show up to that party. Great stories would have been told, skeletons would be dug up. It would be fun. Maybe, maybe we should host one.

SPEAKER_01 9:24

Maybe we should. We'll talk about that. But this is what makes payments so strange right now. At the exact same time we're talking about very traditional questions like merchant screening and monitoring, the industry is also trying to figure out what happens when AI agents start shopping and paying on behalf of people.

SPEAKER_03 9:40

Which is super fun.

SPEAKER_01 9:41

Of course, that's the fun part to you.

SPEAKER_03 9:43

Do you know I love robots, Kitty? Everything today is becoming more and more AI enabled. In fact, I think in 10 years we're gonna have a really dumb society because people can't do anything without AI. But that's a personal opinion. And I think one of the big challenges with agenda commerce and AI today, and the fact that we are pushing that technology so fast, is you're dividing the population into two segments. You're dividing the population into people who really trust AI and want to fully get behind it, and then you're dividing the population into the lawyers like Chris who distrust it. I'm I'm kidding, Chris. I'm just making a generalization because lawyers don't trust anything. But when you when you boil these numbers down, a recent visa research study on Agenic Commerce indicated that only 23% of US customers that were surveyed actually trust Riv AI or Agenic Commerce to handle payment transactions on their behalf.

SPEAKER_01 10:40

Which means the technology conversation is moving faster than the trust conversation.

SPEAKER_02 10:44

Yeah, that's right, Kitty. And once you let an agent make decisions, you immediately get all the boring questions that turn out not to be so boring. The authorization questions, the consent, the liability, the disputes, disclosures, and responsibility.

SPEAKER_03 10:59

And that's where this gets really interesting. We've spent years building payments technologies, checkout flows, mobile applications for a human being being the one to do the purchasing and the button clicking. Now we're talking about letting software decide what to buy, when to buy it, potentially complete the transaction on its own. That leaves a lot of questions.

SPEAKER_01 11:18

So on Monday, we're asking whether a processor monitored a merchant closely enough. And on Tuesday, we're asking whether a robot should be allowed to buy my new couch.

SPEAKER_03 11:26

Exactly. Like I said, daily podcast.

SPEAKER_01 11:28

Still not going to happen, Jason. Now, there is one thing I do want to say pretty directly, because as Sunshine grows, we want more ISVs and software companies to understand what being featured can actually do for them. And I don't mean come on the podcast and give us a 30-minute product demo. That's not what we want. And honestly, that's usually not very interesting for the audience either.

SPEAKER_03 11:46

We will let you get to brag about the cool things you do, but we found that the best episodes are when a company knows something because they've actually been in the trenches, had to solve something themselves.

SPEAKER_01 11:57

Exactly. Maybe you moved into embedded payments and discovered the operating model was more complicated than the integration part. Or maybe you expanded into a new market. Maybe onboarding broke at scale, maybe reconciliation became a mess, maybe card present changed your product, or your customers force you to rethink how you handle payments entirely.

SPEAKER_02 12:15

Maybe you had to decide where your responsibility stopped and your partner's responsibility started, and learn that the contract and the real operating model weren't quite the same.

SPEAKER_03 12:25

Those are the stories that make companies an interesting thing. If everybody in your category has a website that says you're seamless, innovative, blah, blah, blah, built for the modern business, that doesn't tell anyone who you actually are.

SPEAKER_01 12:37

That's where I think being featured on Sunshine can be really valuable. You get to demonstrate expertise instead of just advertising a feature list. Because if you're competing in a crowded software category, everybody can say they're easy to use. Everybody can say they have great support, and everybody can put embedded payments on the website. What's harder to copy is a point of view that came from actually building and operating the exactly.

SPEAKER_03 12:59

And if you can explain why you made a particular architecture decision, what broke when you scaled, what you learned from a particular partner transition, or why the obvious implementation turned out to be not the right one. That tells me a lot about the company than the feature checklist does.

SPEAKER_02 13:16

It also signals maturity. Being able to talk intelligently about the trade-offs doesn't make a company look weak. Usually it does just the opposite. It tells the people you've actually thought through where the risk is and what responsibility comes with the product.

SPEAKER_01 13:30

And for the people listening who are thinking, well, we don't have some giant dramatic payments disaster to talk about. Good. He's still free at one for us. I don't want that. The story doesn't have to be a crisis. It can be a decision, a lesson, a weird customer requirement, a growth problem, or something you had to redesign because your business changed. We want to hear about it.

SPEAKER_03 13:48

And preferably before the disaster, right? With SenseChat, you have a team of industry experts who have been doing the payments thing for a long time. So if you're facing a challenge that you're not quite sure how to solve, come talk to us. We'd love to share what we know with you as well.

SPEAKER_01 14:04

Yes. SenseChat doesn't require a fire. We just like hearing what you learned and when you notice the smoke. The podcast gives people the conversation. We can build the editorial story around what you learned. We promote the episode socially. And now we're adding the full video side through YouTube. So one good conversation can become a much bigger piece of brand credibility than just one podcast.

SPEAKER_02 14:24

Yeah, and from my perspective, credibility comes through a lot better when you're willing to talk about the hard part. Nobody believes every implementation was perfect and every decision was obvious.

SPEAKER_03 14:34

And these are the exact kinds of things we would talk about at that awesome compliance party where you we were talking about earlier, kitty. Imagine the stories that people would share behind closed doors. Those are the stories we want to have on SenseChat, right? Tell us where the diagram lied. Tell us what didn't work the way you expected it to work.

SPEAKER_01 14:54

Absolutely, but I do expect in open bars.

SPEAKER_03 14:57

If you can get Chris to approve it, I vote yes. Let's get the waivers out.

SPEAKER_01 15:01

But that's the whole idea. If you're an ISV, a marketplace, a vertical SaaS company, a PayPal, or you're building something interesting around payments, we want to hear the real story. What did you learn that somebody else building this should know before they learn it the expensive way? So going forward, that's what I want more of. More founders who are willing to talk about the point where the original plan actually met reality, more operators who can explain what happens behind the scenes, more technical conversations that Jason can translate for me when he gets too excited. More risk and compliance conversations that don't sound like somebody reading a policy manual. More stories from ISDs that are actually building payments into the product and discovering what ownership really means once money starts moving.

SPEAKER_02 15:42

And more conversations we can separate what the rule says, what the contract says, and what everybody is actually doing. Those aren't always the same thing.

SPEAKER_01 15:52

I also want to keep bringing in companies from outside the little payments bubble when the story is good. Sometimes the most useful perspective comes from the software company that didn't set out to become a payments expert. They were trying to solve a customer problem, and then payments became strategic, whether they wanted it to or not.

SPEAKER_03 16:08

And those are some of my favorite conversations to have because you get the before and after. At first, payments is a vendor integration, the volume grows, customer expectations change, economics start to matter. And suddenly a software company who never intended to be in payments says, Hey, we can do this better ourselves. And now it's infrastructure.

SPEAKER_02 16:29

And that's usually a point where the agreements, control structure, and operating responsibilities need to catch up with what the business has become.

SPEAKER_01 16:37

So that's the kind of story we're looking for. Not necessarily the biggest company or the loudest company, the company that has something real to teach you.

SPEAKER_03 16:44

Plus more AI, agenda commerce, payments infrastructure, data, all the other things Kitty definitely wants to discuss every single morning on a five-minute daily podcast and over our awesome lunch conversations.

SPEAKER_01 16:57

I'm gonna mute your microphone and stop inviting you on.

SPEAKER_03 17:00

That seems very anti-growth.

SPEAKER_01 17:02

Cynthia, if you're listening, this is the problem I'm dealing with. Do you understand? But really, we're excited about where Sunshat is going. We're gonna keep the podcast practical. We're gonna keep talking to people who are actually doing the work. We're gonna keep pulling apart the stuff in payments that sounds simple until you actually have to operate it that way. And now you'll be able to watch the full episodes on YouTube, which is a very exciting next step for Sunshat, or a terrible mistake that will force all of us to have to improve our language.

SPEAKER_03 17:27

Or perhaps both. I think it's mostly exciting.

SPEAKER_01 17:29

And if you're building something interesting in payments or software, you've got a story that other operators can actually learn from. We'd love to hear it. The best sense chat episodes aren't pitches. They're the stories where somebody can say, here's what we thought was going to happen, here's what actually happened, and here's what we would do differently if we knew everything now.

SPEAKER_03 17:47

Because if there's one thing we've learned doing this, it's that the sentence, this should be simple, is usually the beginning of an episode.

SPEAKER_01 17:54

And usually the beginning of the problem.

SPEAKER_03 17:55

Which is good for the podcast.

SPEAKER_01 17:56

Very good for the podcast. Maybe less good for whoever's living through it. Huge thank you again to Cynthia Sassy for helping us think bigger about helping us think bigger about Sunshine and where we're going nice. Go check out CynthiaSasse.com and Steve, we hope Hawaii is terrible.

SPEAKER_03 18:12

We don't really mean that, but uh come home soon, buddy. We miss you.

SPEAKER_01 18:15

We absolutely don't mean that. We're just very jealous.

SPEAKER_03 18:18

Very jealous.

SPEAKER_01 18:19

That's it for this week's SenseChat. We'll see you next time, and apparently soon you'll actually see us too.

SPEAKER_00 18:24

Thanks for tuning in to SenseChat. Got questions? Got ideas? Got payment problems keeping you up at night? We've got you covered. Head over to our website to take out a quick survey. If you'd like to land a guest spot on the pod. Don't forget to subscribe, share this episode with your favorite ISB, and follow us on all social for the latest trends, tips, and debates. We promise no boring slideshows. At FenseChat, we're here to make payments that make sense. And make it fun while we're at it. See you next time.