How To Choose A Merchant Acquirer For New Markets
Businesses that are going to enter new markets in 2018 need a merchant acquirer that will support their aims and customer payment methods.
Not every merchant acquirer or payment provider is equipped to support merchants in every market around the world. Some aren’t tooled to handle multiple currencies or the regulatory and security burden of operating in international markets.
One argument in support of international expansion is the slow growth of the UK economy. Over the next five years, HM Treasury doesn’t anticipate GDP growth to exceed 2 percent. And yet, you could have new and existing customers who would welcome the opportunity to buy your products or services in new markets.
In some regions, such as South East Asia and Latin America, not to mention, India and China consumers want European goods and services. Buying from a UK brand (for example) has numerous positive connotations, such as ‘luxury’ and desirability, which is why now is a good time for British brands to capitalise on these advantages in fast-growth markets.
When choosing a merchant acquirer in a new market, you need to keep the following in mind:
- Are they equipped to handle national and regional currencies? In some countries, payments will come through in more than one currency. Usually a result of high tourist numbers from a neighbouring country, or the prevalence of online wallets or credit cards in US dollars.
- Can they handle payments from multiple third-party sources? Make sure your payment provider and merchant acquirer in that country is capable of supporting incoming transactions from multiple currencies and payment options and platforms such as Apple Pay or Alipay and other regional variations.
- What volume of transactions do you predict? A merchant bank will need to know a transaction volume estimate and an average ticket value (ATV), which will apply equally whether you are opening a bricks and mortar store in another country or focusing on online cross-border trade.
- How often – and in what currency – do they make payments? You don’t want to be stuck with a merchant acquirer that holds onto international funds long after the goods have been shipped. They may also need more financial, business and security information than a local acquirer, and this could also involve you being asked to hold more funds than normal in an account to protect against chargebacks and refunds. Ask about this before signing any contracts.
- What customer support can you expect? It’s also important that should your business need help, you can expect responsive customer services. Ask for client testimonials and case studies, and look for reviews from other businesses from your country or region before committing to an international merchant acquirer.
- Ask how do chargebacks and refunds impact merchant payouts? Make sure a chargeback or refund is not going to cause an entire payment to be withheld until an issue is resolved. Before signing on the dotted line, ensure you’re fully acquainted with the small print, terms and conditions, and anything else that could impact your relationship with the merchant acquirer.
Expanding globally is the next logical step for ambitious businesses. Picking the right merchant acquirer is an important step towards achieving a successful international customer-base. By asking the questions above you will be in good position to partner with the right acquirer for your business needs.