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Enabling Cross-Border Payments In Multiple Ways

Payoneer is a financial services company that provides online money transfer and digital payment services. It enables buyers and sellers, whether transacting directly or through B2B marketplaces, to reduce the uncertainty and risk associated with high-value B2B purchases by making secure payments. Rohit Kulkarni, Country Manager, Payoneer India, tells us more

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Tell us about your presence in India. How do you plan to address concerns over online security with a cross-border payment platform?
In India, we took a lot of time to engage in the market, we worked collaboratively with our banking partners and the regulators to understand the regulatory requirements, making sure to comply not only with the letter but with the spirit of regulation. We hired the best local lawyers to advise us, engaged with members of the community, and really tried to learn the policies behind the regulations. India’s government is taking very constructive steps in trying to open things up and stimulate growth, and it’s important to understand the intentions behind the rules that were being laid out. Once we understood the requirements, we ended up having to re-design our traditional products to be better suited to the needs of Indian businesses and regulators. Unlike other markets which are dominated by singular segment, our target audience in India are the freelancers, e-commerce sellers and SMB Software & Service providers. Enabling them to receive cross-border payments in multiple ways, including various marketplaces like Amazon, AIRBNB, Upwork, etc. In addition, they can invoice their clients in the U.S. and Europe using Payoneer’s US/EU Payment Services to receive payments via ACH transfers in the U.S. or Euro transfers in the EU. On receipt, the funds are automatically transferred to the user’s personal or company bank account in Indian Rupee (INR).

With regards to the security concerns, we are a PCI compliant company and are regulated in the US, UK, Europe, Japan and China. We have the right set of licenses in India from RBI to operate as a B2B cross-border payment provider. In addition, we have a strong risk-based platform to identify security threats, customer risk, transactions risk and fraudsters and keep them away from good customers. We invest in it a lot and it’s a core part of our backend operations.

In your opinion, what are your strong areas where you can claim to be a game changer?
Our strength is our platform, which allows hassle-free payments for businesses in India across countries and currencies, whether they get paid by marketplaces, or direct clients, or both. Payoneer is integrated with over 2500 marketplaces and networks like Airbnb, Amazon, Getty Images, Google, and Upwork, allowing businesses, sellers and professionals expand business across geographies and marketplaces seamlessly. Our banking relationships world over including India help us to create parity between an SMB and other enterprise companies when it comes to collecting money globally. Payoneer pricing is extremely customized for the SME sector and it can be as much as 71% cheaper than banks and other players. Our team on the ground is always looking to learn and improvise, to provide a better solution to our customers. Additionally, we are a large, global company with a compliance-first mindset, which is crucial in being able to set up the type of infrastructure and robust processes to maintain global regulatory compliance.  

Who are your competitors in this space and what gives you an edge over them?
There is nobody who does exactly what we do. We work with businesses across multiple segments to launch globally, manage their day to day business and also grow their revenues with our partners. Traditionally businesses used international wire transfers and run of the mill financial solutions to run their global businesses. We come and help them transform into managing their business with a cutting-edge technology and fiscal platform with the host of features and functionalities that are unique.

What are the challenges of enabling cross-border commerce?
India has shown a strong growth in both the export of goods and services. This is true for both merchants and businesses who are striving to expand and venture into global markets. When it comes to Indian businesses conducting cross-border transactions, there are multiple friction points that SMEs face on a day to day basis. While tools and infrastructure are being opened for SME’s, the payment infrastructure that was created for larger businesses do not serve as efficiently with small businesses. As the traditional ways of doing business are shifting towards a borderless digital world, we encounter issues such as high currency exchange rates, slower transfers, and high fees on all funds received. What these businesses are looking for is a platform to receive payments in a hassle-free, cost-effective and compliant way.

Tell us about the trends in online marketplaces? Do you expect to see a fundamental change in the way payments are made in the next five years?
There has been a rapid rise in the online marketplaces and in today’s borderless world, talented professionals and small businesses are looking at payment solution that removes the hurdles associated with sending and receiving international B2B payments. There is an increasing need for the complainant and low-risk solutions that enable businesses to expand into new markets and scale their business.

Did demonetization impact your business in India? What trends did you witness in the market say six months back and now?
Digital transformation has changed the modes of payment globally making it easy, cashless and hassle-free. India is seen as one of the top markets for the digital economy as it is ranked fourth in terms of active Internet users across the world. We see India as a huge opportunity. The 2016 Internet Trends Report by Mary Meeker, a partner with venture capital firm Kleiner Perkins Caulfield and Byers, found that India is the only exception to the slowing growth rate of internet adoption, accelerating to 43% year-over-year growth in 2015. In addition, total online cross-border spending in India grew by more than 78% from 2015, cites BCG. India has shown strong growth in both the export of goods and services in the recent past. The country has a large population and a budding market of entrepreneurs. Today, we have over a million merchants selling goods like handicraft, leather products, jewellery, apparel and home products. India is also one of the biggest ICT service exporters. In fact, 30 per cent of India's export is software and services. With more than 1.5 crore freelancers; it is estimated that we bring in about 40 per cent of global freelancing business. Our products and offerings are customized to help each of these segments gets paid from their global clients in a fast, easy and low-cost way.

Finally, could you tell us about some of the upcoming milestones? Any plans to introduce new services in 2018?
We are an input focused company and pure revenues do not stand as a yardstick of our success. Though we are growing over 50% YoY globally and more than 4X in India, our true success is to drive transformation in the way businesses pay and receive money internationally. Our ability to enable an individual or a home office to find and serve clients thousands of miles away from their workplace seamlessly is a very fulfilling experience for us and a strong testimony to our offering. Efforts are required to put in to educate the segment, improve their skills and abilities and help them compete in the global sphere. Our endeavour to enable them through awareness campaigns, Payoneer Forums, domain-specific webinars and blogs are all an effort to drive this transformation.

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B2B marketplaces airbnb amazon Rohit Kulkarni