Digital Check Solution Makes Headway in Auto Finance

Baxter Credit Union, based in Illinois, has found a new solution to an old, and costly problem. David Brydun, vice president of consumer lending, exclusively told Bank Innovation that the financial institution has partnered with on a digital check issuance solution that utilizes blockchain.

“A lot of what goes on in digital lending is focused on the front-end UI, your own online application, mobile apps,” said Brydun. “This is part of the backend, on how someone gets access to their funds and digitizes that process for us.”

The credit union’s first use case is auto lending, specifically for dealer purchase loans. Checks will be sent via email to members, to be made payable to dealerships, so  that the member can forward the check to a dealership, or print and hand deliver, for same day processing.

Brydun says the credit union would previously spend upwards of $10 a check to overnight to members, and with this solution, that cost has been reduced to a few cents. In addition to this, there will be a 25% reduction in processing time from utilizing’s platform.

The Silicon Valley-based startup,, says that the average credit union stands to, have an “ROI of 242% and over $1.6 million savings in under 36 months.” Paper check use, nearly extinct in most countries, still dominates business-to-business payments in the U.S. This has invited digital innovators to tackle the problem, and consequently has a number of competitors in the digital; checking space, including INV Fintech alum SnapCheck, and Deluxe, which first partnered with a company named VerifyValid in 2013), then purchased it in 2015, to get into the digital checking space.

For BCU, with $3 billion in assets, the cost savings will be “over $100,000 per year” for auto lending services alone, Brydun said. Forthcoming use cases include auto loan refinance, and debt consolidation loans.

The solution not only presents cost savings to banks and credit unions, it also demonstrates yet another use case for blockchain in payments and financial services.

In part due to patents pending, PJ Gupta, CEO of, would not go into specifics of how the platform works, but told Bank Innovation that the backend use of the blockchain is to “enhance security by preventing online forgeries using a distributed ledger for check verification.”

Users receive a notification via email that a check has been issued, payees can then request a call or text to have the check deposited.

Gupta says the company has been in talks with bank aggregators like Jack Henry, and FIS since 2016. He anticipates entering into formal agreements with “2 of the top 20 banks” in the next six months to a year.

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