5 WAYSPAYMENTS CAN ACCELERATE YOUR MARKETPLACE GROWTH

1

2

3

4

5

Introduction Learn how payments can accelerate your marketplace growth.Advancements in technology and engineering have always brought with them periods of immense change. First, it was the Industrial Revolution; next, the Technological Revolution. Today, we’re in the midst of the Earning Revolution—a fundamental shift in the way that individuals work and earn.

We’ve seen this in the expansion of the marketplace segment in Europe and beyond. These platforms have introduced new opportunities for people to make an income in unprecedented ways. Entrepreneurial individuals can earn some extra cash delivering food through Britain’s Deliveroo, or supplement their income by car sharing through France’s BlaBlaCar. Marketplaces are predicted to account for €572 billion in the European Union by 2025.1 But even with these lofty expectations, European marketplaces still face a number of barriers to growth.

This ebook will examine how partnering with an established payout provider can help your European marketplace:

Remove friction during the onboarding process.

Keep supply-side users loyal to the platform.

Maintain control of the entire user experience.

Scale operations into overseas markets.

Reduce the risk of non-compliance with regulations in Europe.

1According to The Cost of Non-Europe in the Sharing Economy, a report from the European Parliament published in 2016.2

5 WAYS PAYMENTS CAN ACCELERATE YOUR MARKETPLACE GROWTH

Remove Friction During the Onboarding Process

User onboarding is often impaired by several important points of friction. Identity verification—which typically requires users to upload their identity documentation and supplemental information—can be so complex as to deter users from the platform before they’ve even begun. Most marketplaces request too much information during the onboarding process—better to start with simple information, such as name and address, then fill in the granular details once the user is ready to start conducting business on the platform.

In addition, many marketplaces ask for supply-side users’ banking information during enrolment. This seems prudent—after all, they’ll need to be paid for the work they’ve performed on the platform—but some users may be uncomfortable sharing this information during onboarding. Others might not even have a traditional bank account, introducing another roadblock to platform adoption.

Marketplaces aiming to streamline the onboarding process will find one solution in prepaid cards. With prepaid cards, marketplaces can serve banked and unbanked users equally while simultaneously providing faster payments than many alternatives.

Solution: Reduce the amount of user information required during onboarding and increase the speed to platform participation.

1

* Source: McKinsey, 2016. EU-15 countries only.

- Independent Earners in the EU-15

- Population of the EU-15

60-94Million

405Million

Estimates suggest that there are 60 million to 94 million

independent earners in the EU-15.

3

5 WAYS PAYMENTS CAN ACCELERATE YOUR MARKETPLACE GROWTH

2007- Self-Employed Workforce

- Regular Employees

2017

28%6%

Keep Supply-Side Users Loyal to the Platform

According to research, marketplaces’ payment processes are central to keeping users loyal to the platform. More than half of marketplace users rank the speed of payments as their top reason for staying loyal to a marketplace. Four in five would change to a competitor in they felt the fees incurred for transacting were too costly. One in eight actually have switched marketplaces due to frustrating payout schemes.2 Bottom line: marketplaces risk losing users if their payment processes are inefficient.

The payment process also impacts other factors essential to marketplace for loyalty. For example, the number of demand-side users on a platform is determined, in large part, by the number of supply-side users. If there are fewer users offering their products and services—say, because inefficiencies in the payout process have prompted them to switch to a competitor—we can also expect fewer buyers of those products and services, encouraging suppliers to switch to a more active marketplace.

By working with an established payout partner, marketplaces can help ensure they provide fast, transparent, and secure payouts to their global users, improving overall loyalty to the platform.

Solution: Boost platform loyalty through fast, transparent, and secure user payouts.

2

* Source: EY, 2016.

The UK’s self-employed workforce has grown 28 percent over the past 10 years, compared with 6 percent

for regular employees.

2Hyperwallet, The State of Ecommerce Selling in 2017.4

5 WAYS PAYMENTS CAN ACCELERATE YOUR MARKETPLACE GROWTH

14%

Maintain Control of the Entire User Experience

Few marketplaces are interested in ceding control of any piece of the user experience to a third-party provider—and that’s not particularly surprising. Reliance on outside partners often means complicated onboarding, less transparency, and a more user frustration. Still, as platforms grow, keeping all of these processes in-house becomes increasingly difficult. Marketplaces are often forced to contract with third-party providers for a least some aspect of their operations. But how do they do that without sacrificing control of the user experience?

Marketplaces that need to rely on an outside payout provider should pursue a partner that offers the back-end integration options necessary to instal payment capabilities directly within their own digital ecosystems. With Hyperwallet’s developer toolkit, marketplaces can embed global payout functionality into their websites and mobile applications. Because Hyperwallet acts as an API layer within the platform, marketplaces can maintain full control of the experience. Payment configurations can be customised, and all payouts, communications, and support can be fully branded—meaning that users are not often aware that they’re interacting with a third-party provider.

Solution: Embed payout functionality and ensure control of the user experience.

3

* Source: McKinsey, 2016. EU-15 countries only.

In EU-15, 14 percent of independent earners have used a digital platform to find work.

5

5 WAYS PAYMENTS CAN ACCELERATE YOUR MARKETPLACE GROWTH

Scale Operations into Overseas Markets

Aside from the regulatory considerations that come with paying into a foreign country, few marketplaces recognise the difficulty of establishing payment mechanisms in new markets. It’s not as simple as coordinating with a handful of large, multinational banks. Instead, marketplaces are often forced to organise payments through their own banking channels, opening and managing local bank accounts to effectively serve dispersed users.

Once they’ve established payout processes in another market, marketplaces will likely need to expand other aspects of their operations. New countries mean new languages, which requires the scaling of support and onboarding procedures. There’s also identity verification, which can prove particularly challenging in emerging markets that lack the resources used to identify marketplace users in developed countries. Building out these ancillary processes can lead to inefficiencies, high costs, and a disappointing user experience.

By working with a global payout partner, marketplaces can enable worldwide payout capabilities while outsourcing other important manual processes (e.g., multilingual customer support, identity verification).

Solution: Enable payouts to almost anywhere in the world while reducing administrative burdens.

4

* Source: EuroStat, 2016. All EU-28 countries.

32%

Roughly 32 percent of the EU’s online shoppers have bought or ordered goods or services from

sellers in other EU countries.

6

5 WAYS PAYMENTS CAN ACCELERATE YOUR MARKETPLACE GROWTH

Reduce the Risk of Non-Compliance with Regulations in Europe

Perhaps the largest regulatory consideration for European marketplaces in the coming years is the impending effects of the Second Payment Services Directive (PSD2). Whereas they were previously exempt, PSD2 brings two-sided marketplaces firmly within the scope of the regulations applied to traditional payment service providers.

At the very least, many two-sided marketplaces in the European Union will need to revisit their payment handling processes before regulations become law on 13th January 2018. One option for marketplaces is to apply for authorisation as either a Payment Institution (PI) or E-Money Institution (EMI), but it would require full operational compliance and months spent waiting on approval. The other option is to leverage the services of a provider which is already authorised to provide payment services.

Outside of Europe, marketplaces will need to consider the regulatory requirements of each region they plan to expand into, which can vary significantly from country to country. Working with a global payouts provider enables marketplaces to better navigate these challenges and helps them reduce regulatory compliance risk when operating abroad.

Solution: Assist in reducing regulatory compliance risk while quickening penetration of new markets.

5

* Source: EuroStat, 2016. All EU-28 countries.

* Source: New York Times, 2015

More than 1 in 10 workers in the EU is self-employed.

7

5 WAYS PAYMENTS CAN ACCELERATE YOUR MARKETPLACE GROWTH

Hyperwallet’s global payout network enables marketplaces to seamlessly penetrate new markets while reducing the compliance risks associated with international regulations. By streamlining the onboarding process and providing faster payout solutions, you can keep more supply-side users on your platform. Best of all, our back-end integration options enable you to maintain control of the user experience.

Learn more about Hyperwallet’s solutions for marketplaces. Connect with a Solution Expert today.

Available funds

£270.86 GBP

$125.67 USD

€25.60 EUR

Date Description Debit Credit

Jun 13 2016

Jun 13 2016

Jun 13 2016

Jun 13 2016

Transfer to card

Transfer to bank account

Foreign exchange

Foreign exchange

$50.00 USD

£50.00 GBP

€34.56 EUR

£25.00 GBP

Live Chat

12:28 Tonia

Okay. THANK YOU!i

12:27 Andrea

Let me know if there are any additional issues I can help you with.

Select a Language...EnglishespañolfrançaisDeutschpyccĸИЙ

češtinaEλληvıĸάBahasa Indonesiaitalianopolskiportuguêsportuguês (Portugal)Tiếng Việt

Transaction History

Bank Account

Prepaid Card Debit/Credit Card

Payout Options

MoneyGram Paper Check

Settings

Knock Down Your Barriers to Marketplace Growth

8

5 WAYS PAYMENTS CAN ACCELERATE YOUR MARKETPLACE GROWTH

About Hyperwallet

Hyperwallet’s payout platform provides growing organisations with a frictionless, transparent, and reliable way to manage payments and enhance the payee’s experience almost anywhere in the world. Trusted by enterprise, ecommerce, and on-demand platforms, Hyperwallet makes it easy to pay up to 7 billion people in a singular payment environment. Put your payees in control with enhanced financial management tools, integrated payment tracking technology, and user-friendly compliance and identity verification. Hyperwallet has offices in San Francisco, Austin, London, and Vancouver. You can learn more at www.hyperwallet.co.uk.

Contact Us

Email: marketplaces-uk@hyperwallet.comPhone: +44 (0)800 086 9801 Website: www.hyperwallet.co.uk

© 2017 Hyperwallet Corporation. All rights reserved.