Matchmaking for financial relationship


Ideally a transaction partner will make its service affordable. This sounds as though it should go without saying, but there are organisations out there that push their costs up too high – how many times have consumers made a purchase and found the price goes up if they want to pay by card?

Ravi Karia is the owner of Universal Textiles, a company which has been featured on Amazon’s front page. He believes there is a balance and speaks with passion about affordability. “Whatever you can save on transaction fees will go straight into your profits,” he says. “Since most customers don’t like to pay transaction fees, most online retailers eat these costs and any savings will be noticed at the end of the year. If you have a merchant account, it’s also good to renegotiate the rates every year especially if you have grown. The larger [payments] brands generally charge more than a merchant account from a bank since you’re paying to not only accept payments, but use their brand name to promote safe shopping.”

That said, he understands the power of a big brand and suggests it can be worth paying for PayPal, Amazon Payments or Google Checkout. “Signing up with these brands will mean you will have to pay more in commission fees than if you went to your bank, but using these services is worthwhile since there is no monthly fee, only variable costs. They take a set commission off the total payment accepted and you can set up and start in minutes. They all offer payment protection in some form, so this will give your customer confidence in dealing with you.” This can, of course, be invaluable to the newer trader on the block and the customer will like signing in with an account once rather than entering their data all over again. Registering with a bank will offer the merchant more control and a lower per-transaction cost but, as the saying goes, “you pays your money and you takes your choice”.


End-customers will, of course, be reassured by the presence of a name they know at the checkout, which is why payment processors such as Visa and MasterCard do well, as do the banks – and in recent decades PayPal and WorldPay have come to the fore.

Branding and the resulting confidence should play an important part in deciding who to partner. Wendy Dobson is head of innovation at DataCash, and makes a number of points about what to look for in a partner’s values and brand. “Protecting and growing a merchant’s brand means ensuring a consistently good experience across all purchasing channels,” she says. “This means providing consistent usability, speed, convenience via suitable payment options and security.

The customer’s experience will also reflect on the merchant’s brand and, whereas a trusted brand is important, it shouldn’t subsume everyone else’s identity. “When designing the customer journey, merchants should ensure that payments pages have the same brand consistency as the rest of their site. Customers who feel as though they have left a merchant’s website to a separate company to make payment can often lose trust at the crucial payment point. E-payments partners offering fully tailored pages can ensure that, from a customer’s perspective, they have not left the merchant’s website.”

Related to this, of course, is the issue of trusting a brand. “Customers often abandon their purchases and leave a website during the checkout process if they are presented with technical issues. The very nature of digital commerce makes the options to switch to a different website very quick and easy, but can have long-term effects on customer loyalty and retention,” says Ms Dobson. “It is essential that merchants ensure their payment partners are able to provide a reliable and consistent service that will not buckle during high-demand periods, including seasonal, sale, promotional or product-launch peaks.”


Clearly not important to everyone and dependent on the structure of a merchant’s business, a partner that can trade all over the world may be vital to reach all customers. Roelant Prins is chief commercial officer and founder of Adyen, a company which aims to be global, but also to understand local markets and individual customers.

“With so many countries in the world, and the vast array of different languages and cultural idiosyncrasies, accommodating each and every customer can be a lot harder than it initially appears,” he says. “Particularly when it comes to paying.”

The magic-bullet approach adopted by some merchants doesn’t always work, says Mr Prins. “We’re always amazed that the majority of merchants still regard credit and debit cards as the catch-all payment method for global e-commerce. The reality is that this has not been the case for many years. A recent online poll found that 31 per cent of all online shoppers wanted access to payment methods that were specific to their region,” he says. “These include new methods geared towards e-commerce, such as iDeal in the Netherlands – a form of online, real-time bank transfer – pre-paid cards, e-wallets and real-time online banking, all of which have seen huge uptake among shoppers.”

Understanding the local needs is, of course, pretty vital; for example, offering credit card facilities in Germany will go down less well than debit cards as Germans are not so fond of borrowing. Knowing about other localised quirks is useful. “A great example of this can be found in Brazil where locals prefer to pay by installment,” says Mr Prins. “A history of high inflation in the country has meant that employees tend to receive their salary at different points throughout the month, as opposed to one lump sum. When it comes to transacting online, Brazilians tend to look for split-payment functionality or an option to set up installment plans to pay for goods and services.”


Customers in some niche industries are simply accustomed to a particular form of payment. Damien Warburton, copy and brand manager for Skrill, points to one example: “In online gaming, for instance, customers are used to digital wallets,” he says. “Look around and see what similar businesses are offering to get an idea of what might work with your audience.” Digital wallets would be completely inappropriate, for the moment, in other niches or in broader-based markets.

Assuming the customer is catered for as they wish, a good partner will help analyse how they are behaving. Payment specialist Zuora suggests analytics is a key differentiator. “The cloud generates a wealth of real-time data about how customers are using the service, as well as helping us identify what features to build next,” says a spokesman. “Companies can now have visibility into data and usage patterns to help customers optimise how they’re using their tools. The ability to analyse that data is a must when choosing e-payment partners.”

And, of course, there are the networking basics; a partner is providing a service and that service needs to be up to scratch. Mark King at PEER 1 Hosting points out that speed of transactions is crucial. “The first step is to ensure latency is kept to a minimum by evaluating where your e-commerce application is hosted and matching it against the locations of the provider,” he says. “This is also beneficial for expanding online offerings internationally – you want a payment provider that can expand with your business,” he says.

“The speed of the checkout process is vital. Consumers expect certain steps in the process – too many and they don’t have the time to complete the transaction, too few and they will be skeptical. You can evaluate the success of your process with Google Analytics, but a good way to get it right is to benchmark your competitors and actually buy something to test out what they’re doing.”