North Little Rock-based fintech startup Gas Pos released a software Tuesday (Feb. 12) that’s expected to reduce fraud related to truck driver fuel cards and offset the fees truck stops pay when the drivers use their cards.
CEO Josh Smith said truck drivers use the cards to not only purchase fuel but also to track data, such as the number of miles driven. The companies that offer the cards charge truck stops a service fee when they are used, and the truck stops must charge the drivers who use the cards the lowest advertised cash price for fuel. However, with the Gas Pos service, truck stops will be able to charge a higher price to offset the fees.
“We offer a chance for the truck stop owners to kind of level the playing field,” Smith said. “It’s only fair that people should pay for the services that they receive, the benefits. In a free and open market, you always pay for the value that you receive. And this is a way for the truck stops to do that.”
The average truck stop is expected to save more than $40,000 monthly, and with 12,000 truck stops in the United States, the savings could be in the billions annually, according to Gas Pos. Also, Smith said fuel card data is at risk as fraud has risen, and the software is expected to be more secure by hardware encrypting the card data to prevent its theft.
Gas Pos recently received a $1 million investment from Merus Capital, a Silicon Valley-based early-stage venture capital firm, and the investment has helped to launch the new Gas Pos service, which was named, Steve, after its first customer. Gas Pos has partnered with cloud communications platform Twilio to allow for the new method to process FleetCor/Comdata and WEX/EF fleet fuel card transactions. The virtual payment system uses Twilio’s global communication platform to complete point-of-sale transactions on existing payment networks.
“We are inspired every day by the innovative ways companies use Twilio’s cloud communications platform to build great experiences for their customers,” said Jesper Joergensen, general manager of voice and video at Twilio. “Gas Pos is a great example of this, and we look forward to powering their newest virtual payment solution.”
Smith said fuel retailers can receive the service without an upfront investment, which is expected to save the average retailer about $25,000 annually. The service will cost truck stops $200 monthly and 10 cents each time a fuel card is used. Gas Pos recently completed a six-week test of the service, and Smith expects 1,000 truck stops will start to use the service over the next year.
Truck drivers will still be able to use their fuel cards in the same way with the Gas Pos service, and trucking companies will retain their payment system advantages. In August, Lowell-based carrier J.B. Hunt Transport Services announced a rewards program for carriers and their drivers to provide them with fuel discounts and other perks when using a J.B. Hunt 360 fuel card to purchase fuel at participating Pilot and Flying J truck stops.
Gas Pos revenue rose 1,329% to $1 million in 2018, and the company’s revenue is expected to rise to more than $5 million in 2019, said Smith, adding that the company could be valued in the 10s of millions of dollars over the next three to five years. The company has 14 employees and an office in North Little Rock. In October, the company relocated its headquarters to the city from Birmingham, Ala.