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By: Mariah Young,

Real estate investment and lending marketplace improves transfer times by 50% with new payments API partner

Download the Case Study PDF

The global market for investments in real estate crowdfunding is estimated to hit $3.5 billion in 2016, as reported by Crowdfundbeat. Platforms enabling this investment must be at the top of their game to be competitive.pol-logo-2014-patch-of-land-logo-vertical

Problem: Patch of Land’s existing payment provider had dated technology, long delays, and was unresponsive to their needs. These obstacles were hindering Patch’s ability to scale effectively and deliver on the service expected by their customers.

Results: Patch of Land integrated Dwolla’s Access API, reducing the time to payout settlement by 50%. The optimization of cash availability, along with the API’s contract-based pricing, has reduced fees for the platform by 36% over its previous solution.

The Situation

Patch of Landpatch-of-land-home-page@1x is a national marketplace connecting accredited investors with vetted, underwritten real estate investments. Patch of Land facilitated over 35K transactions in 2016, and since its start in 2013, the platform has funded over $245MM in loans and paid out $67MM to investors.

Patch of Land has two user groups: Investors and Borrowers. Investors leverage the crowdfunding platform to search for and invest in real estate properties. Returns are paid out to investors on a monthly basis into their Patch of Land Account. Investors can also choose to enable automatic withdrawal directly to their bank account, in which case, Patch of Land uses Dwolla to facilitate the funds withdrawal the day distributions are made. On the other side, Borrowers use the platform to apply for and receive investment to grow their real estate projects.

The Challenges

Patch of Land realized that their investors were frustrated with the slow, dragging process of withdrawing their returns from the platform; when investing several thousand dollars in an opportunity, even one day of interest that could be earned proves significant. They needed a solution that processed withdrawals as quickly as possible.

Additionally, Patch of Land was incurring a percentage-based fee on each investor withdraw. This forced their accounting department to attempt to predict and project transaction-based expenses.

To turn the dial on growth, Patch of Land needed a solution that was tailored to their needs. They needed a solution offering better timing for withdrawals, a more predictable pricing model, and a technology stack that suited their unique needs.

“In our search for a solution, it was clear from the developer documentation that Dwolla was a modern in-road to the ACH network. Better yet, from the dedicated support and outstanding tools Dwolla provides, we continued to find new value-adds that really made the solution standout.”
BRIAN FRITTON, CTO & CO-FOUNDER

brian fritton patch of land

How Dwolla Helped

Improved transfer times

When dealing with large dividends and new investment opportunities, every second matters. Patch of Land needed to deliver bank transfers in a shorter time frame to continue to delight their investor base.

Solution: Patch of Land opted for the Next Day Transfer feature as part of their Access API integration. This feature allows even more flexibility in transfer speeds, and ACH transfers into the Dwolla network process in 1-2 business days.

Outcome: With Next Day transfers at their disposal, Patch of Land was able to reduce their transfer processing time by ~50%, from 3-5 days down to 2-3 business days. This afforded Patch of Land more time and flexibility in their payments.

A more predictable fee structure

When dealing with investments, high dollar transactions can be quite common. The ability to better predict and afford the costs of a payment solution became a critical operational requirement.

Solution: Patch of Land entered into an Access API agreement with Dwolla, which is billed in a fixed structure with predictable variable fees rather than a percentage-based fee on each transaction amount.

Outcome: Patch of Land’s accounting department is happier with a more reasonable, predictable pricing structure, while the business has been able to save thousands on per-transaction fees.

Impeccable technical stack and support

In their search, Patch of Land found that most ACH providers had dated, unrefined API documentation and technical support that was equally lackluster.

Solution: In becoming an Access API partner, Patch of Land received a cleaner, more future-proof funds transfer engine, real-time transparency into individual transaction statuses, and a dedicated Slack channel for human support.

Outcome: Patch of Land was able to switch providers, integrate and go-live with Dwolla’s Access API in just 17 business days.

Dwolla’s ability to streamline the integration process and offer up direct access to their team via a Slack channel could not be overstated. It told us that they were invested in our success. It did wonders for our team’s ability to quickly design and develop our integration.
DEVON PETERSON, VP ENGINEERING

devon peterson patch of land

Timeline

time of access api integration

Features used

patch of land uses dwolla access api

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Financial institutions play an important role in the Dwolla network.

Dwolla, Inc. is an agent of Veridian Credit Union and Compass Bank and all funds associated with your account in the Dwolla network are held in pooled accounts at Veridian Credit Union and Compass Bank. These funds are not eligible for individual insurance, including FDIC insurance and may not be eligible for share insurance by the National Credit Union Share Insurance Fund. Dwolla, Inc. is the operator of a software platform that communicates user instructions for funds transfers to Veridian Credit Union and Compass Bank.