eCommerce and Payments

Optimize the most critical stage of your online sales

process

Ovidiu Moise 2016

Why is this important to you?

Everyone focuses on optimizing the website user experience, performance, stability

but …

how important is really the payment flow?

???

Ovidiu Moise 2016

Let’s get to know each other

Ovidiu Moise 2016

And in my private life…

Product Owner – Domains management platform @ 1&1 Internet Development

Ovidiu Moise 2016

And in my private life…

Product Owner – PayU payments platform

Ovidiu Moise 2016

And in my private life…

Product Manager – eMag Mobile App

Ovidiu Moise 2016

Let’s get down to business.

How do payments work?

Buyer MerchantOvidiu Moise 2016

Let’s get to business.

How do payments work?

…

Buyer Merchant

Payment

Services

Providers

A few technical integrations, medium dev effort.

Ovidiu Moise 2016

Let’s get to business.

How do payments work?

…

Complex integrations with various financial actors: banks, wallet integrators, other PSPs

Buyer Merchant

Payment

Services

Providers

A few technical integrations, medium dev effort.

Payment methodsOvidiu Moise 2016

How does it all work?

Offer a legal and system integration framework to enable payments between ‘all’ banks in the world, with special focus on antifraud (e.g.

merchant blacklisting)

Ovidiu Moise 2016

Complex and costly integrations because of legacy, undocumented systems. Slow performance, low flexibility, almost no enhancements are possible.

How does it all work?

Offers merchants/PSPs multiple APIs that enable the main financial operations for payments

Authorization: funds are blocked on the bank account for a certain period, ensuring that the payer has a valid payment instrument and has enough funds

Complete: the merchant lets the bank know it just began delivering the needed product, and the funds begin transfer

Reverse/Refund: customer/merchant decided to cancel the transaction and the money is unblocked/sent back. But after some time (big customer experience issue).

Ovidiu Moise 2016

How does it all work?

Integrator role, hides complexity and offers one(ish) well documented endpoint for managing payments on multiple payment methods

Generic APIs for doing all the bank authorization/complete/reverse/refund operations

Giving merchants their payouts – aggregated funds, from all sources, periodically in their bank account

Antifraud services to detect fraudulent merchants but also stolen credit cards

PSPs

Call center services. Did you ever call a bank to solve an issue?

Various cost-reducing optimizations due to large volumes and market influence

Ovidiu Moise 2016

What does everyone desire?

• Low total cost

• Safety• Secure channel – if I pay online, will it be safe from hackers?• Secure merchant: will I give my card details to a creepy website?• If I pay now, will the package arrive on time? Will it arrive at all?

• Return policy: if I pay now, will I still be able to return the product and get my money back?• If I call the callcenter will anyone answer? If they answer can they solve my problem? If they

solve my problem, in how much time to I get my money back?

• Payment experience: no popups, no going back and forth between pages

• Context saving – no need to re-fill in all my data if something goes bad (mobile).

Buyer

Ovidiu Moise 2016

• Market share – buyers and merchants control

• Commissions and margin (banks vs visa, PSPs vs banks, banks vs merchants etc.)

PSPs and Banks

What does everyone desire?

Ovidiu Moise 2016

• How can I reduce my PSP commissions?• Negotiate with your PSP – usually monthly invoice, based on a percentage out of total volume• the TSP scheme – multiple bank accounts, with improved commissioning costs• Several players in the PSP market – PayU, BT24, euplatesc.ro, Libra Pay etc.

• How can I have flexibility when changing PSPs?• When writing your code – make it modular and scalable for multiple payment methods and API oriented• Use existing free libraries for each PSP

• How can I make sure that I have all the payment methods my buyers need? How do my buyers actually pay?• Good point for internationally oriented startups• Multiple PSPs for multiple payment methods?

• I need to get my money from the PSP as often as possible. I want several currencies, in several bank accounts, in multiple countries.

• Payouts usually take place 1 or 2 days after payment

Merchant

What does everyone desire?

Ovidiu Moise 2016

• How can I increase the conversion rate for each payment method?

• How can I keep branding/user experience control?

• How can I lock in my customer and have as much data as possible on his payment patterns?

What does everyone desire?

Merchant

Ovidiu Moise 2016

Popular payment methods – Credit Card (~20% of total online)

Customize, apply branding on the payment page.

Embed the payment page into your flow as native as possible.

Get from the PSP and from a bank no-3ds terminals.

Medium dev complexity – one integration needed, with PSP, for managing payment and client redirections.

Issuing bankPSPMerchant

Ovidiu Moise 2016

Popular payment methods – Credit Card

Ideally payment form native to the app, otherwise through webview.

Avoid if possible 3ds. Take great care how 3DS looks for each bank in part.

Complex development effort due to integration, multiple OSes, versions, multiple device sizes.

Card saving via tokenization.

Ovidiu Moise 2016

Online bank transfers

Integration with various online banking systems, covered by the PSP.

Ovidiu Moise 2016

Popular payment methods - others

• Payment on delivery – around 70%• Payouts received from transporters – less reliable, slower money flow

• Installment programs – Star BT, Card Avantaj (CEB), Bonus (Garanti) etc – large adoption in RO – around 30% of card payments • Negotiations possible on number of installments and costs for merchant

Ovidiu Moise 2016

I am a startup online business. What should I look at?

Setup

• Choose an appropriate PSP and decide the best for you – TSP, PSP.

• Choose the needed payment methods that your customers will use• Payment on delivery

• Credit card

• Installments

• Online bank transfers

• Etc

• Negotiate with banks special conditions

Increased complexityLarger shop

Ovidiu Moise 2016

I am a startup online business. What should I look at?

Optimizations

• Follow all KPIs for payments: failure rates, grouped by reason. • Keep a close collaboration with PSP and investigate failure reason

• Develop a strategy to not lose a failing payment:• Not enough funds? Come back with an email proposing a different payment method.

• Integrate payment page

• Save credit cards

Increased complexityLarger shop

Ovidiu Moise 2016

New BIG STUFF coming up – the Wallet

Multiple technology worlds colliding in the next 10 years with one goal: capturing the payment behaviour of all consumers on the planet.

TelekomSocial and business networkOwner of the actual gadget/mobile phone

Social networksAccess to social network and events/likes

Banking/Other financialCredit cards – saved via tokensInstallmentsHome bankingBitcoin payments

MerchantsMerchant coupons, vouchersLogin credentials (tokenized)

Offline lifeNFC shoppingAirplane tickets and boarding passesQR code payments

Ovidiu Moise 2016

Thank you!

Backup slide – Card saving flow

Payment

Services

Provider

Payment Payment

Authorization

Payment OKPayment OKPayment OK

Cards saving is enabled

YES

Do you want to save your card for future use?

Payment

Services

Provider

Save card that was used in transaction with Refno ……

Save card temporarily

Get a token that represents the saved card

Card TokenMerchant card Token

Ovidiu Moise 2016