When your business is providing technology which enables billions of people and millions of merchants in growth markets to transact online, there’s no substitution for having a strong local presence in each and every one of them.
That’s the path PayU is taking to success and it’s a strategy that is working quite well, chief commercial officer Matthias Setzer said.
The 17-country list where PayU operates includes India, Turkey, Russia and Brazil, regions with their own unique customs, needs and business approaches. Before making big decisions and unveiling a strategy for an area, there is no substitution for due diligence, Mr. Setzer explained.
“We spend a lot of time and money building local connections.”
Those connections allow PayU to understand local payment preferences from the first day. PayU opens up local offices in each country staffed by local people. They obtain all necessary licenses and provide the strong local presence that is mandated in countries like Russia and Turkey.
PayU matches that local familiarity with technology that is easy to use, Mr. Setzer said. Via single API merchants can access all popular payment methods.
What is popular in one country may not be in another, Mr. Setzer explained. In India, many prefer PayPal and similar methods, while roughly two per cent of the population has access to international credit cards. Through a partnership with German company Kreditech, in which they made a €110 million investment in May, PayU offers clients instalment credit or purchase on account with interest.
No matter the payment method each individual customer in every one of those 17 countries chooses, they need to have a quick and seamless experience. That takes a lot of work on the back end to account for each different payment type.
“It should be like an iceberg,” Mr. Setzer said. “When your order a movie on Netflix you don’t want to think about how you pay, you want to enjoy the show.
“We help shield the merchant and consumer from the experience through the routing technology.”
That technology does more than deliver a fast, problem-free experience, Mr. Setzer said. It is now at the point where it can take full advantage of Kreditech’s ability to analyze more than 20,000 data points within seconds to deliver a credit score that is more accurate and current than anything a bureau can deliver. That allows them to identify more eligible consumers that would likely have been rejected in the past.
In many cases PayU technology allows them to better deliver on payment methods long accepted in local cultures, Mr. Setzer said. Turks use some e-wallets but lots of cards on which they use instalment plans. In Brazil, some international cards can be blocked. In India, people use local direct debit card schemes and bank payments.
These opportunities are driven by gains in mobile technology which in addition to ease of use also allow for a much wider range of biometric authentication.
“In many places, the mobile phone is their only access point and desktop use is barely measurable,” Mr. Setzer said. “Look at the stats. The number of people using mobile banking in some African markets is higher than it is in Korea or Sweden.
“If a bank doesn’t fit on a simple smartphone, if your digital banking experience doesn’t fit on a simple phone it doesn’t exist.”