Asia’s Trillion Dollar Electronic Payments Problem

Feb 16, 2017

Taken globally, the electronic payments industry is almost as fragmented as the mobile messaging industry for platforms like WeChat (China), Line (Japan), Viber (Philippines), and others.

In North America, PayPal and its subsidiaries Venmo and Braintree play a dominant role in the electronic payments market. In Africa, Kenya’s M-PESA is the top player. It serves as a means of economic exchange for consumers without bank accounts, and operates as a mobile savings platform for millions of consumers who don’t have access to the traditional banking system. Alibaba’s Alipay and Tencent’s WeChat Wallet play a major role in the Chinese market.

The electronic payments industry has been growing and changing with rapid advances. Today’s market landscape is regionally fragmented, but it is huge from the global aspect.

Merchants interested in a low-cost and secure merchant account should turn to emerchantbroker.com, the #1 high risk payment processor in the US. EMB is one of Inc. 500’s Fastest Growing Companies of 2016, and is rated A+ by the Better Business Bureau (BBB) and A by Card Payment Options.

All over the world, less than 20% of the payments completed by both consumers and businesses in 2014 crossed international borders. The information is based on the McKinsey’s 2015 payments report. Asia represented almost 40% of the $1.8 trillion in total payment industry revenue in 2014. The region is expected to count for nearly 45% of the revenue initiated by the global payments industry by 2019.

Though the Asian payments market seems to be unified to some extent, the reality is something else. From the regional point of view, the electronic payments market is characterized by disparities in technological adoption and intensity of regulatory oversight.

Companies in the payments industry looking for dominance in the Asia-Pacific and Southeast Asia regions meet additional hindrances in the form of regulation. Like some electronic payments companies from North America had difficulty expanding their services to other regions, the majority of payments service providers in Asia experience the same. The innovation in the payments industry in Asia is based on seamlessness. Most payments companies focus on making the process of payment processing as frictionless as possible.

The market for electronic payments and other financial technology products is large and is becoming even larger. Based on the McKinsey report, in Asia alone, payments revenue generated from all sources is expected to increase more than 40% between 2014 and 2019.

The bad thing is that, currently, it’s not clear what path a payments company should choose to achieve global dominance.

Simply copying the business models that have worked in Europe, the Americas and Africa, is not enough for Asia: to be successful, the products and services built should be adapted to local context and market conditions.

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Having a merchant account allows an account holder to take advantage of merchant cash advances. When a merchant is approved for an advance, the business agrees to receive a lump sum of cash in exchange for an agreed-upon percentage of future credit card sales.

Pricing varies depending on the merchant’s industry, past credit card processing history, the type of business seeking the account, average ticket sales, and average transaction volumes.

Yes, EMB works with merchants who are building their credit, as well as those who have poor credit. EMB also approves merchants that have no credit card processing history and businesses that have lost their merchant accounts due to high chargebacks.

Several factors influence a merchant’s risk level. Though only one factor likely will not get a merchant classified as high risk, a combination of these may: business size, location, and industry, credit score, credit card processing history, a industry’s reputation for excessive chargebacks, a prior history of high chargeback ratios, and whether a merchant exclusively sells online.

Virtual terminals are stationed on a merchant’s website, making it easy for customers to make a payment or purchase online. Merchants or a payment processor can easily set up virtual terminals, so online businesses can accept credit and debit card and e-check transactions.

A merchant account is a business account with an acquiring bank. Without this business account, which actually works more like a line of credit, a merchant cannot accept and process credit and debit card transactions. Businesses need a merchant account to accept major credit cards via a static point-of-sale terminal, mobile card reader, or through a virtual payment gateway.

After filling out EMB’s simple online application and submitting any necessary, requested documents, many merchants get approved within 24 and 48 hours.

EMB specializes in working with high-risk merchants. EMB works with many merchants, including but not limited to businesses in these industries: gambling and gaming, adult entertainment, nutraceuticals, vaping and e-cigarettes, electronics, tech support, travel, high-end furniture, weight loss programs, calling cards, e-books and software, and telecommunications.

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