When you hear the word, eCommerce, you might think Amazon, Walmart or Alibaba? How about a stall in a third world market? Probably not, but if you’re in payments the opportunity to enable eCommerce for the 180 million micromerchants around the world represents a $35 billion annual revenue opportunity.
Organizations like Mastercard get it. Mastercard has launched a campaign to enable 40 million micro and small merchants by 2020, as part of its Financial Access 2020 commitment. Part of the reason for the program is to help users get access to the financial system. But it also has a solid business case, building market share in developing countries and setting themselves up for transaction fee growth as the ecosystem develops.
Mastercard was one of the companies that participated on a panel titled, Faciliating eCommerce in a World Where Everyone is a Merchant, at the K(NO)W Identity Conference panel, along with WePay, Aite Group, G2 Web Services and Trulioo:
Panel Description: As the payments space continues to grow in size and complexity, merchant acquirers and their partners face new challenges to manage risk. On a global level, fraud continues to migrate from the physical world to the fast-growing CNP environment. At the same time, the acquiring value chain has become more complex with the growth of payment facilitators and marketplaces. This panel session addressed the significant and growing KYC challenges in the space, as well as ways in which technology can help with effective and efficient risk assessment and compliance. Specific topics of discussion included:
- Merchant and sub-merchant KYC challenges, both at the time of onboarding and on and ongoing basis
- The need for speed in the competitive SMB space ·
- Accurate assessment of portfolio risk and compliance with the growing list of network requirements
Onboarding merchants is always a complex task. Onboarding micromerchants in the developing world is especially tough. Steps to reduce friction and speed up the process go a long way to ensuring the merchant follows through and becomes an ongoing client.
However, there are highly prescriptive regulatory requirements that must be met. Onboarders must collect enough information to ensure that they know who their customer is (KYC) and can perform proper due diligence checks. Beyond legal compliance rules, performing proper checks on merchant information is necessary for fraud prevention and risk mitigation.
How to create a process that is both easy for the client and provides proper data is the key to successful merchant onboarding and is covered in depth by the panel:
If you are interested more in this topic, listen to The State of Identity: