It allows you to smooth out funding. And Tim could speak about that with a lot of particularity. How I think about the application in TriumphPay is, we have almost 30,000 select carriers, for example, people who are not doing business with a factoring company, but are being paid directly by TriumphPay and in some cases being QuickPay by TriumphPay on behalf of the freight brokers we serve, the ability to smooth out funding to them and get it to them when they need it is a really big thing. And Tim, any other thoughts around where the value prop like even from our own factoring clients as we roll out LoadPay to them, what else would you consider?
Tim Valdez: Yeah. I think you hit on the biggest part is the ability to fund 24 hours a day, seven days a week without any sort of time constraints, the operational efficiencies within the factoring group is really important. The ability for having visibility quickly and easily for our clients is also an added benefit from that program. So LoadPay, in general, just creates a portal for us outside of the Fed, it gives us flexibility across the entire enterprise.
Melissa Forman: And when you think about a trucking company or carrier owner operator on the road, they may have an emergency on a Saturday or on the fourth of July, they have a breakdown, a blowout. Today’s solutions don’t afford them the ability to get paid quickly without having to do some sort of money code type transaction. LoadPay is going to allow them the opportunity to see what their pending payments are within TriumphPay, and then select that they want to be paid now and not have to wait until the next business day to receive those funds. They’ll receive it instantly and can solve whatever problem is that they’re trying to address. And that’s huge for a trucking company for a carrier and a driver, not being stuck on the side of the road, waiting for funds to be able to fix their problems and they can get back on the road and be on time is a big deal.
Aaron Graft: And one final thing, and then we’ll turn it to Todd to speak about banking as a service. Just there’s far more to this than just the timing. Like the way the whole wallet is designed, the way we allow carriers to offload into a variety of products. You think about who are we competing with? I mean, that’s where — you’re competing — I mean, 97% of the payments we push out the door are well over 90% are being ACH to a bank account. I have met no banks that really care that much about their truckers who have one to five trucks. I mean, they give them okay service, but they never — they would never build a banking or wallet experience on behalf of a small trucker. And so there’s things we’re doing in the way you can move money in, the way you can move money out, the way things you can see in the user interface that no one’s ever done before, and we’re competing against banks who probably aren’t that invested in staying the bank for a small trucking company.
Of course, if it’s a large fleet and publicly traded, of course, they’re going to have sophisticated treasury management services, and we would not pretend that LoadPay is particularly valuable in that scenario, although we can see some things perhaps way down the road where we can be valuable with that. But we’re competing against just standard bank accounts, which were never built and are not tweaked with the trucker in mind, and that’s how we do everything. How do we help truckers thrive? That’s part of our mission because if they thrive, we thrive and so there’s a lot more to this than just the timing but maybe just to finish up, make sure we hit your question, Todd, you can speak about banking as a service and what we’re thinking of.
Todd Ritterbusch: Yeah. Your question about regulatory considerations is a good one. The biggest difference between providing banking as a service capabilities and doing regular traditional banking is the involvement of these third-party vendors. And what is crystal clear is that you cannot lay off any of your compliance responsibility to any of those third parties. So that means that from a compliance perspective, we have to invest a lot of time and energy in making sure that we’ve got everything covered ourselves or anything that is being done on behalf of a third party keeps us in compliance with the requirements. So yes, that is a significant thing for us, but we think we’ve got it under control.
Michael Perito: So just one quick clarification question. So for LoadPay, it’s going to be a LoadPay mobile app that these truckers will download and then they will have VIN numbers with TBK Bank accounts with you guys that the money will flow in and out of correct? Is that the right general?
Todd Ritterbusch: That’s correct.
Michael Perito: Okay. All right. Great. And then just really appreciate all that. Thanks for spending a few minutes on it. And then just lastly for me and then I’ll step back. Just I’m sure someone else will maybe ask a couple of more specifics about some of the credit migration you guys saw, but I have kind of a bigger picture question, Aaron. I think the balance sheet obviously hasn’t grown for a while. I mean you guys talk about kind of your five year plan here. What’s the five year plan for the balance sheet? How should we start — as we start to — we’re obviously probably were not doing it today, but in the near future, we’ll start thinking about 26% and start going out further, like how should we continue to think about the bank balance sheet does it continue to shrink?
Do you think it continues to hold flat? I mean it feels like as the EBITDA gets better at TPay, the earnings of the bank — I don’t want to say it becomes less valuable, but it doesn’t — it’s not serving the same purpose as it was kind of historically when you were just building that up from the ground up. Just would love some updated thoughts there, if you’re willing.
Aaron Graft: Yeah. Tremendous question, very fair question. So remember that as we go out and we seek to be a counterparty for freight brokers, over 25 of which do over $1 billion of transactions and some much larger than that. They’re outsourcing payments to us, which makes them a very — makes us a very large financial counterparty to them. So I don’t see any time in the near-term where we’re willing to just go it alone on fees in transportation because we could not stand face-to-face with a publicly traded freight broker and say, we can weather a downturn, right? Because we’re not going to go out and raise equity from private equity or venture capital. We don’t need that. We don’t want to dilute our investors. So it’s important for us to be able to weather the storm, like we weathered the storm in 2023.
