Usio Conference Highlights ACH Growth, Banking Platform and Utility Payments Opportunity

Key Points

• ACH processing is Usio’s strongest growth and margin driver: The segment carries a 70% gross margin, with volumes up 34% year over year in the first half and 39% in the third quarter. Overall first-half 2026 revenue rose 17% to $49.1 million, while adjusted EBITDA improved 65%.
• New growth opportunities span education, banking and utilities: Usio processed $1.3 billion in education-related disbursements across 37 states and has 23 universities in its Title IV refund pipeline. Its beta-tested Ion banking platform could attract $300 million to $500 million in additional deposits, while a Harris Computer partnership could provide access to as many as 70,000 utility customers.
• Management raised its full-year outlook: Usio increased its 2026 revenue-growth guidance to 14%–16%, up from 10%–12%, as Output Solutions and payment-processing businesses offset weaker card-issuing results.

Usio NASDAQ: USIO outlined growth across its payment processing, ACH, card issuing and print-and-mail operations, while highlighting new opportunities in business banking, education disbursements and utility payments.

Chief Executive Officer Louis Hoch said the fintech payment processor supports multiple payment channels, including checks, ACH transfers, cards, real-time payments and digital-wallet options. The company printed 8 million checks last year, he said, while also offering newer payment rails such as FedNow, The Clearing House network and pinless debit transactions.

Usio operates four divisions: payment facilitation, ACH processing, card issuing and Output Solutions, its print-and-mail and electronic-document-delivery business. Hoch said the company’s payment-facilitation strategy focuses on selling to integrated software vendors rather than individual merchants, allowing Usio to reach the software providers’ downstream merchant bases.

He cited PracticeSuite, a provider of medical-office software, as an example of the model. PracticeSuite has embedded Usio’s payment capabilities within its platform, and Usio shares payment revenue with the software provider. Hoch said the combination of embedded technology and revenue sharing makes such relationships difficult to replace.

ACH growth and payment volumes

ACH processing remains Usio’s highest-margin business, with a 70% gross margin, according to Hoch. He said the segment has set record highs in each of the past six quarters.

The company reported that ACH transaction volumes rose 34% year over year during the six-month period discussed in its presentation. For the third quarter, which Usio said it expected to report financially on Nov. 10, ACH transaction growth was pre-announced at 39% year over year, while the dollar value of those transactions increased 26%. Return-check transactions, such as non-sufficient-funds and closed-account items, grew 44%.

Hoch said Usio’s ACH volumes through the Federal Reserve would rank it as the 50th-largest U.S. bank by processing volume if it were a bank.

Card issuing and education opportunities

Chief Accounting Officer Michael White said Usio’s card-issuing operation, which issues prepaid Mastercard products, recorded a 9% increase in purchases on its cards during the first half of the year compared with 2025. The segment faced difficult comparisons after a customer relationship was lost through a reseller, he said.

White highlighted school-choice and education-related disbursement programs as a growth opportunity. Usio processed $1.3 billion in funds across 37 states through a partner during the prior 12 months, including five active card programs and other ACH programs. An additional state opportunity not included in that total represents $1 billion, White said.

The company also is working with universities on Title IV student refunds. Usio has one university live and 23 additional institutions in the pipeline through a reseller, according to management. The reseller has already won those accounts on another processing platform and is moving them to Usio, the company said. White noted that higher-education disbursements generally occur on a semester basis.

Usio’s Consumer Choice technology allows recipients to select how they receive funds, including through virtual cards, physical cards, checks, ACH transfers or real-time payments.

Output Solutions and Usio One

Output Solutions, which Usio acquired in 2020, provides first-class mail, printed statements, invoices and electronic document delivery for financial institutions, utilities, cities, counties and toll-road operators. White said first-half printed-and-mailed volume grew 36% year over year, while electronic document delivery rose 45%.

The company launched its “Usio One” initiative in early 2025 to combine its historically separate business lines under consolidated sales, customer-support and operating structures. White said the initiative is designed to support cross-selling and operating leverage.

Los Angeles County was cited as an example: The county initially became a disbursement customer, and Usio subsequently added Output Solutions and payment-processing services.

Ion platform and Harris partnership

White said Usio is beta testing its Usio Ion business-banking platform with four customers. The platform is intended to settle merchant funds into a Usio wallet rather than an outside bank account, while providing access to payment products and tools such as expense-report and accounts-payable management.

Usio currently holds between $80 million and $100 million of customer settlement funds in its bank accounts at a given time and earns interest on those balances, White said. Management believes Ion could provide access to an additional $300 million to $500 million in deposits following a full launch.

The company also recently launched a partnership with Harris Computer, a subsidiary of Constellation Software. Harris selected Usio as a preferred payments provider, potentially opening access to up to 70,000 utility customers served by Harris, White said. He cautioned that utility and government implementations can take time.

For the first half of 2026, Usio reported revenue of $49.1 million, up 17% from the prior year. White said all business lines except card issuing recorded growth. The company also reported a 65% improvement in adjusted EBITDA, positive net income, and a $0.03 improvement in earnings per share compared with the first half of the previous year.

As of June 30, Usio had $6.4 million in cash and $93.7 million in settlement-related funds. The company raised its full-year revenue-growth outlook after the second quarter to 14% to 16%, from prior guidance of 10% to 12%.

About Usio (NASDAQ:USIO)

Usio, Inc NASDAQ: USIO is a financial technology company that provides electronic payment and money-movement services. Its platform supports payment acceptance and processing through methods such as credit cards, debit cards and automated clearing house (ACH) transactions.

The company offers services for businesses, financial institutions, government organizations and other entities seeking to collect, disburse or manage payments. Its solutions include electronic bill payment, card processing, ACH payments and prepaid card programs, with an emphasis on integrated payment technology and related processing services.

Usio was formerly known as Payment Data Systems and adopted the Usio name in 2020.

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