Global Acquiring is an activity which has traditionally been relegated to the back-offices of financial services, and organizations have only recently started to think about how to invest in acquiring, and how to process transactions internationally, adding value in terms of capabilities, either for investment purposes or to improve services for merchants and PSPs around the world.
When it comes to giving advice on international expansion to acquirers and PSPs from various regions, Ron Kalifa, Deputy Chairman at WorldPay, explained in an interview for Payvision (during the International Acquiring Forum, held in London in September 2013) that: “Global acquiring needs a lot of investment; you have to be very disciplined and very focused in terms of which markets and how you would like to enter those markets. There are a very few relative assets of value in the market, so buying business is harder to do than to say, and it’s essential to decide carefully which markets a merchant chooses to expand into internationally.”
A very important recommendation we at Payvision can offer to acquirers, PSPs and their merchants when they are thinking of expanding globally is to find a suitable partnership and to enter global acquiring networks so that you can learn from their knowledge in the cultural, legal and linguistic challenges of eCommerce. The international market is being challenged increasingly by incomparable technical innovations, changing business needs and an increasingly onerous regulatory landscape. In this context, a global player will enable merchants, PSPs and acquirers to build business relationships with other cross-border financial institutions in the USA, Europe, the Middle-East, Africa and Asia Pacific.
As Ron highlighted, the main objective is to ensure that merchants enjoy a wide choice of payment types – that’s the ‘raison d’être’ of the acquiring industry. On top of that, from Payvision’s experience, we know that if online merchants look to expand their business internationally, they have to overcome a number of challenges. Merchants have to analyze and understand local business customs, consumer preferences and cultural differences. Marketing strategies need to be customized to local logistics and delivery services. A common language and culture reduces the barriers and saves the retailer the high transaction costs involved in adapting websites and promotional copy. Merchants also need information about multi-currency conversion and settlement in currencies defined by major card schemes, including interchange rates, local preferred payment methods, how to manage logistics, chargebacks and more. In this non-profit portal created by Payvision & partners, you can learn more about the international expansion challenges.
The partnership with global acquirers can help you to save time and money, as Todd Ablowitz explained it perfectly, and allows you to access different payment types, increasing the opportunities for merchants to expand internationally and to be prepared to serve customers from different parts of the world. Through this connection, merchants can increase their potential revenue streams by expanding their global presence.