“All businesses whose value proposition boils down to ‘we move money’ are thinking about risk,” said Software Engineer Alyssa Frazee. “Every single one — banks, credit card issuers, payment processors, lenders and payroll providers. Moving money in the United States comes with the possibility of financial loss for any parties involved.”
Frazee works for Check, a fintech company that specializes in payroll software. Check created the first embedded payroll API. Companies can integrate Check’s payroll solution into their own platform and start a payroll business much faster than if they were to build out this functionality on their own.
Most recently, Frazee helped roll out a new security addition to Check’s platform alongside two other product updates.
CHECK’S NEWEST LAUNCHES
In late 2023, Check announced the launch of three new tools in its payroll suite: Credit and Fraud Protection, Embedded Setup and Embedded Support.
Credit and Fraud Protection: Platforms can rely on Check’s powerful technology and a team of experts, with no responsibility for credit or fraud losses.
Embedded Setup: Platforms can rely on Check to take care of setting up employers and handling implementation end to end. Using its core payroll platform and team of payroll experts, Check migrates all payroll data, verifies accuracy and resolves potential issues, so customers can focus on what’s most important.
Embedded Support: To help with any questions or concerns, Check now offers a team of in-house experts to answer questions on behalf of platforms. The team is also “white labeled” in the sense that they act as an extension of the customer’s company, preserving the customer’s brand identity.
The Credit and Fraud Protection offering has been a big part of Frazee’s work, and it’s something that she believes Check is particularly suited to give its customers.
“Check’s goal is to abstract away the complexities and pain points of payroll from our partners so they can focus on building fantastic platforms without also worrying about building a risk program,” said Frazee.
She added that Check has the data on payroll losses and is positioned to use that data to protect partners, their users and Check itself from financial losses.
“Having a great risk program ensures our partners’ longevity and ability to create great payroll businesses for decades to come,” she noted.
The Paradigm Shift for Fraud Protection
Payroll fraud is one of the most prevalent forms of fraud for businesses, and small businesses are twice as likely to experience it, according to Check’s website. The widespread issue requires near constant attention and pivoting on the part of Check’s product team.
“Nine years working on risk in fintech has taught me there’s almost never one ‘aha moment’ or silver bullet,” said Frazee. “It’s just a series of incremental improvements and ideas that build on each other until it gets to a tipping point and we have a breakthrough or paradigm shift.”
For the team at Check, the paradigm shift came when they were able to implement the groundwork that they built back in 2022, like the requirements API. The addition of credit and fraud protection has been a long and intentional process. Credit and Fraud Protection is the fourth version of Check’s risk program, Frazee added.
“We made three major upgrades in less than two years, all of which took a lot of effort, deep dives into complex financial data, creativity and teamwork.”
Frazee noted that, for her, moving at that pace required her to scale her skillset.
“The business needed more than what one engineer could accomplish,” she said. “I got the chance to think bigger and empower the whole team to build something that would have a huge impact on our business, both financially and operationally, which was rewarding.”
“I got the chance to think bigger and empower the whole team to build something that would have a huge impact.”
To her, building the Credit and Fraud Protection offering helped the whole team grow in their understanding of data-driven decision-making. The process was a careful calculation of what to prioritize.
“Risk products are always a give and take — Matt Brown’s ‘Iron Triangle of Embedded Fintech’ blog post explains this really well,” noted Frazee. “Making improvements in one area, like product experience, usually means making tradeoffs in another area, like increasing fraud risk, or creating more work for ourselves on the backend.”
She continued, “Ensuring our analysis and understanding of the big picture supported the tradeoffs we had to make was very hard, but we overcame it with a ton of collaboration and great efforts across the team to understand the entire narrative.”
Elevating Customer Experience with Embedded Support
Another new release is Embedded Support, meant to shift the burden of providing payroll support from platforms to Check.
“Payroll is complex,” said Chief Customer Officer Kerri Swope. “And for the payroll operator, there is little room for error.”
Swope was not being hyperbolic. She explained that there are more than 6,000 taxes and 1,000 jurisdictions in the United States alone, not to mention over 600 tax forms that are spread across over a hundred government agencies.
“Payroll providers have to know what to do with each of these complexities in a timely and accurate manner to provide great customer support,” she added.
Embedded Support allows Check’s customers to build and launch successful payroll businesses without the complexity and headaches that usually come with it. Swope noted that offering a support service that their customers can use saves them from having to staff a dedicated team of payroll experts internally. Instead, Check handles that for them.
“We focused on Embedded Support being an integrated solution,” said Swope. “It is important to keep our partners’ customers on their platform and elevate their brand with a fully white-labeled embedded support team. This allows our partners to run more lean. Without needing to build out and scale their support team, partners can stay laser-focused on meeting the needs of their customers.”
“A fully white-labeled embedded support team allows our partners to run more lean and keep customers on their platform.”
The service was created after the teams at Check realized that it would be more helpful and easier on customers to use their existing CRM instead of requiring them to use Check’s.
“We realized while in beta mode that working with partners who use the same CRM system as ours allowed for faster implementation and better data insights,” said Swope. “This allowed us to pivot our sales strategy to better position our offering to those partners who could take immediate advantage of Embedded Support versus a one-size-fits-all-all approach to selling.”
Now, if a customer has a payroll question, they go through their own CRM ticketing process, and if it’s a question that Check can answer, the ticket moves to a Check expert who works directly with the customer.
“With every partner and prospective partner utilizing a different CRM system, we quickly realized integrating via APIs across tens of systems would be time consuming and require significant investment to launch,” added Swope. “We shifted our strategy by training our support team to work within our partners’ CRM systems directly to offset the time to market and reduce the near-term investment required for launch.”
Swope shared that she sees the embedded support as evidence that Check is an innovator in the embedded payroll space.
“Payroll historically has been dominated by a few providers like ADP and Paychex,” she noted. “These legacy providers often run on outdated technology and have not adjusted to how modern businesses are run, especially when it comes to the SMB space. Check is innovating in the payroll industry and addressing the needs of the market and businesses today from a partner-obsessed lens through our services-oriented approach.”
Solving Onboarding with Embedded Setup
Onboarding a customer to payroll is one of the most costly and outdated processes in the payroll industry and is prone to mistakes, which can erode employer trust. It requires meticulous data transfers across platforms and sources, which can take weeks to complete.
“Payroll implementations are complicated,” said Product Manager Leah Stewart. “Customers need to provide a lot of information, and need help figuring out everything from ‘How do I get data out of my antiquated payroll system?’ to ‘What is this specific tax?’ As such, we identified this as a key area that Check can take off of partners’ plates, having our team of payroll experts handle it.”
Stewart explained that with Embedded Setup, platforms can rely on Check to onboard their customers. That means handling a lot of data migration around payroll and other employee data.
“With Check handling this complex step, partners can instead focus their efforts and resources on the other aspects of building a payroll business, unlocking the partner’s ability to scale,” she added.
One issue that the team ran into while piloting the tool was ensuring data synchronization between Check’s and customers’ systems.
“Prior to Embedded Setup, Check wouldn’t typically create or update certain objects, so partners were not set up to listen to those webhooks,” said Stewart. “We worked closely with our partners to identify those gaps and support partners in their team’s product changes — not only that, but we also worked together to create an interim solution to ensure the right party took certain steps of the setup process to ensure parity across our systems.”
The team that built Embedded Setup worked cross-functionally, bringing together folks from product, engineering, design, operations, compliance and more.
“I think part of the success of this collaboration was thanks to having established an upfront vision for the team, to ensure we were all driving in the same direction,” said Stewart. “On top of that, we both kept clear owners throughout the process, while also pulling each other into different workstreams and relying on each other’s expertise where helpful.”
“I think part of the success of this collaboration was thanks to having established an upfront vision for the team, to ensure we were all driving in the same direction.”
Stewart shared that the team stretched different skill sets while building the Embedded Setup offering.
“Through Embedded Setup, this team has continually shifted into owning new types of work, and interacting with each of the different parties involved in a setup,” she added. “In particular, this team is now translating (often very complicated) payroll language directly to the employer, who may have little or no payroll knowledge.”
For Stewart, Embedded Setup stands out because it keeps the experience of the customer, end employer and Check operator all in mind. This kind of clear focus and the internal collaboration kept all three releases on track.
