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PCMVo
l 2. I
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TheSubscription
Economy
The business-customer relationship in the digital age
YOUR GATEWAY TO THE WORLD OF PAYMENTS
Welcome to Vol.2 - issue 12
Following our last edition about Recurring Payments, we want to dig deeper into the exciting subscription based business world. In today’s digital age more and more businesses see their advantages in offering their services in subscription tiers. To thrive with this specific type of business model you have to face a number of different challenges. To get a new perspective on this topic, Scott Harkey, Payments Practice Lead @Levvel provides expert advice on how to manage regional distinctions when offering subscription options from a merchant viewpoint. He also addresses how trends and developments in the payments landscape are shaping the business environment of subscription merchants.
Carrying on, Marcos Marins, CEO @PayU Brazil shares his experience about the Brazilian e-Commerce landscape and what he foresees for its future. Focusing on crucial challenges when operating in Latin America, he explains the importance of localized partners too.
Alan Walsh, Head of Marketing @Bud presents the key advantages of the financial marketplace platform and app as well as the reason why they decided not to work with the subscription based model.
Emma Cloninger, Marketing Coordinator @MRC reveals how active participation on social media accounts can actually protect users from identity theft and fraud.
In our start-up spotlight this month, we interviewed Samir Haj, CEO @InfinitePay who tells us the story behind creating financial service offerings tailored to the specific characteristics of B2B e-Commerce market in Germany and its neighboring countries.
Finally, an overview of the hottest job openings we have at the moment. Feel like you need a change or looking for a job opportunity? Get in touch directly by clicking on the job. What better way to network and get to know your peers in the industry? Check out our premium event partners and make use of the discounts we have on offer before they run out!
For any questions, suggestions, or concerns, please address them to the editors:
Amir Abdin - [email protected] Dang - [email protected] Durrani - layla@ paymentsandcardsnetwork.com
The Payments & Cards Network team wishes you good reading!
Thanks to our partners
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Contents
E-Commerce Growth in the Brazilian MarketMarcos Marins, CEO @PayU Brazil, explores key challenges in
the Brazilian e-Commerce space.
Spotlight: InfinitePayFind out how Samir Haj, CEO @InfinitePay, combines a conservative but highly innovative company approach to keep up with the B2B e-Commerce market in the digital age.
Hot JobsHand picked jobs of the month within the Payments and FinTech industry. Check out our hottest vacancies for this month and hit APPLY!
EventsHave a look at the last chances to meet your peers and industry experts in 2016 and make use of our special promo codes!
Why we didn't go down the subscription routeAlan Walsh, Head of Marketing @Bud, tells us the advantages of the online platform & app Bud and how it helps customers and financial service providers.
How social media can protect you from identity theft & fraudEmma Cloninger, Marketing Coordinator @MRC presents suprising findings of a study about social media data and how active participation on social media accounts can protect users.
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Subscription BillingScott Harkey, Payments Practice Lead @Levvel addresses hurdles of businesses in the subscription economy from a merchant viewpoint.
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SpotlightYou think you have what it takes to start a business in a super-hot market?
PCM takes a close look at some of the most innovative and promising startup companies in the payment industry.
startup Spotlight
“WE WANT TO KEEP THE BUSINESS-CUSTOMER RELATIONSHIP IN THE FOREGROUND AND ACT AS SAFE & COST-EFFCIENT PARTNER IN THE BACKGROUND ”
E-Commerce is booming and in particular the B2C eCommerce market prospers. Many new innovative processes and services have entered the market to service growing needs. However, B2B eCommerce can
still be found in its early stage in terms of innovation and development in the payments space. If you look at the volume size between B2C and B2B, it quickly becomes clear that the B2B volume is immensely larger than that of the B2C market. The potential growth the B2B commerce offers comes along with many risks and obstacles. One major challenge in the B2B realm is the payment option of “purchase on account” (Invoicing). We spoke with InfinitePay, a company that tackles this problem hands-on in the B2B market. The CMS Group consists of four companies and the InfinitePay branch offers 100% payment protection tailored specifically for B2B online merchants.
PCM: Payment protection in the B2B e-commerce is a major and important topic. How did the idea come about and what does the product offer the client?
Samir: The idea for InfinitePay sparked from the initial question of whether B2B eCommerce can be as successful as the B2C market. The B2C eCommerce domain experienced a lot of attention and thus growth, driven by payment household names such as PayPal and Klarna. In contrast to that, the progression in the B2B domain has been long neglected. That’s why in 2014 we came up with the idea behind InfinitePay. We
tried to focus on a number of aspects in need of innovation. From our experience and market research we extracted results indicating that paying via “purchase on account” is a predominant preference in the B2B eCommerce market in Germany and its neighboring countries (DACH region). However, this does not reflect the global preferences where credit card payments or other payment methods can be more prevalent. Another fact on which we based the business model of InfinitePay was that 70% of the customers in the B2B markets in our study wanted to have “purchase on account” as a payment option.
In addition, the B2B ecosystem is serviced by various players such as credit insurance companies and factoring companies but these companies were not very well-equipped for the eCommerce domain. Our vision for InfinitePay is to offer B2B online merchants riskless, easy and affordable payment solution. Our aspiration back in 2014 was to transform the current process with credit insurance companies and factoring firms into a solution which is adapted to the digital age.
Another very crucial aspect we wanted to keep consistent when creating our solution is the customer relationship between the seller & buyer. Especially in the B2B space, it’s about building long lasting relationships with customers which we achieved due to the fact we decided to create our solution in a white-label fashion. These were the cornerstones of the InfinitePay creation process.
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Samir Haj, Owner & CEO at InfinitePay
startup spotlight
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PCM: What makes the payment method “purchase on account” for online merchants so risky? How do merchants deal with this situation currently?
Samir: As commerce has shifted more and more to the online domain, the customer identity has become more anonymous too. Online merchants have to face the challenge of validating whether the customer or company placing an order is an actual existing entity. There are various risk aspects merchants need to overcome operating in the digital ecosystem and that is where credit checks come into play to provide more control over the considerable fraud risk.
Our research from B2B eCommerce prospects and clients also revealed that currently the purchases and orders are often still processed manually. For instance, when an order is received by the online merchant, generally it’s printed out and checked manually via a credit information provider or a credit insurance company. On top of that, the online merchant needs to have a credit manager in-house who can check t h e new customer from a risk point of view as well as the delivery address, which might be different from the invoice address. The multiple stages the order has to go through typically take one to two days for the merchants to get valid results. This situation is likely to result in inconvenience for both buyer and merchant as they expect everything to happen in real time in today’s digital age.
Another challenge we aimed to address was the dynamic business environment of the customers in the B2B eCommerce domain. To be more specific, in revolving business relations the solvency of the customer may change. Due to this reason companies take advantage of offline credit insurance and factoring services. However, these offline services require time and cause high processing costs. This is where InfinitePay can help out as we can service the online needs and secure up to 100% against payment defaults. Our service solution also includes an intelligent credit limit control, which operates on positive or negative payment histories, information from collection etc.
PCM: A fully automated order and payment processes would thereby make life considerably easier for many online merchants. Why InfinitePay is suitable for B2B online merchants and what are the costs of such service?
Samir: Making the life of online merchants easier is one of the main goals of InfinitePay. We do this by providing automated and tailored made processes which can lead to great time and cost efficiency. Saying this, the InfinitePay solution is more than just the simple buyer credit check. It also allocates credit limits, which are constantly monitored and under control.
To compare our solution with the current B2B eCommerce options, you need to look at the typical “purchase on invoice” payment option with in-house management and without a payment service provider like InfinitePay. In 2015, the average internal costs per invoice are estimated around 8% based on a survey by ibi research (University of Regensburg). The fees for InfinitePay are a lot more cost effective as they are calculated as a percentage of the sales and in the form of a transaction fee. Depending on the percentage of coverage and the scale of services, the costs for InfinitePay already starts at 0.5% plus costs for credit checks. The fees structure is very comparable to the B2C eCommerce environment.
PCM: Is InfinitePay exclusively designed for the B2B e-commerce with high order amounts, or can it be used for small shopping cart?
This is a very good question because, in fact, we are able to handle any size of shopping carts, whether it is an order amount for 150 Euros or for 150.000 Euros. In principle,
we do not know any limitation in the number of transactions as well as in the
transaction amounts. This means that small B2B, mixed B2B/B2C or
even B2C online merchants can also benefit from the advantages of
InfinitePay.
We have currently more than 250 B2C clients linked to our system. However,
our goal was to offer a solution for B2B online merchants with
high order amounts as that side of the business environment
have been very much neglected in the past.
PCM: What does a typical order process in InfinitePay looks like - from the first click until the payment is cleared?
Samir: In the first step online merchants can be connected via an Application Programming Interface (API) or our shop modules to ensure a 100% payment protection.
Walking you through the customer journey from our perspective, it starts at the moment when the buyer selects the payment method “purchase on account” in the online merchant; a request is forwarded to InfinitePay. Within the checkout process, a credit check and anti-fraud checks on the buyer is conducted in real-time by InfinitePay.
In the next step InfinitePay sends a response back to the online merchant whether the buyer is eligible to choose the payment method “purchase on account” or not. If a positive credit check is received the transaction is processed and the purchase is completed.
All process stages such as risk management, anti-fraud checks,
invoicing, dunning and collection can be incorporated into our services. Thanks to the white label principle, the buyers are not aware of InfinitePay’s involvement and the relationship between buyer and online merchant remains protected. This enables the merchants to focus on their core business and the relationship building with their customers.
PCM: So what makes InfinitePay so special for online merchants and what other competitors cannot do?
Samir: Firstly, we are able to guarantee orders in 40 Countries in real-time and to offer the whole process chain, beginning from order creation, invoicing and debtor management up until the collection.
Secondly, we are able to guarantee high amounts in real-time.
Thirdly InfinitePay helps online merchants to combat fraud at the central point of payments. Online merchants can take advantage of InfinitePay fraud prevention solution, so they can get back to their business.
Due to our many years of financial management experience, we pursue a conservative but highly innovative approach at the same time. This fusion is very unique in the market.
PCM: Where do you see InfinitePay in 5 years from now?
Samir: At the moment we offer InfinitePay mainly to German online merchants, which have national as well as international buyers. In the future we are planning to make InfinitePay available for online merchants worldwide.
Our goal for the mid-term is to establish InfinitePay as the
most successful payment solution in the B2B e-commerce market.
PCM: Any exciting news/announcements you would like to share?
Samir: We’d like to announce our new strategic partnership with Oro Inc. Oro, founded in 2012 by industry leaders in open-source business application development, is the company behind the suite of products including OroCRM, OroCommerce and OroPlatform. Prior to Oro, the founding and senior leadership team helped lead Magento’s success and have an extensive history in e-commerce technology. Through many years of experience in commerce and CRM, Oro is committed to delivering innovative solutions that will further disrupt the customer experience. Oro is already working to localize their B2B e-commerce platform, OroCommerce, to local market needs. This includes integrations with key services such as payments.
This partnership gives us the direct access to B2B e-commerce customers and Oro Inc. can offer our innovative payment solution within their B2B e-commerce platform, OroCommerce.
PCM: Who is behind InfinitePay?
The leading figures at InfinitePay are CEO, Samir Haj, COO, Jan Baszczawski and CTO Germain Dimicoli. All of us are experts in credit management solution including risk management, credit insurance, factoring and collection. The team behind InfinitePay can look back at many years of common experience and are very well positioned to help online merchants with advice and actionable strategies to get the most out of their merchants.
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Get involved now!
We value your feedback and ideas! If you’d like to discuss a specific topic, don’t hesitate to contact us. Get in touch today and maybe YOU will be featured in the next edition: Amsterdam OfficeHerengracht 5761017 CJAmsterdamThe Netherlands
Email: [email protected]: +31 20 3030 257Fax: +31 20 8208 295 Follow us on social media and stay up-to-date with the latest happenings in the payments world!
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