Exciting articles several times a month
1 December 2016
Our today’s guest is Nicola Anderson, VP Marketing of GoCardless, a next-generation payments company providing simple and cost-effective ways to accept Direct Debit payments online, without the need to pay high credit card fees or open a merchant account. Founded in 2011, GoCardless has become the UK’s leading Direct Debit provider and currently processes more than $1 billion per year for thousands of businesses. So how can the company improve the way payments are done and what is the future of the online payments industry?
What is GoCardless all about? What problems do you solve?
GoCardless was originally created to help small organisations, such as sports clubs, collect payments more effectively in situations where managing money could often be troublesome. The founders recognised an opportunity to address the issue by building a useful solution that saved on manual admin and transaction fees. Along the way, they discovered that the UK’s traditional Direct Debit system was clunky and inefficient, and could be greatly improved with GoCardless technology. And so GoCardless is taking Direct Debit into the digital ages for businesses of all sizes supporting both the sole trader and the large corporate, and everything in between.
What is your view on the current situation in the European online payments market? Is there a lot of competition in this space?
The European online payments market is experiencing a great deal of change at present, from improving the existing payment methods, to entirely new innovations entering the market. But most importantly the focus remains on the customer – and on enabling them to pay in their preferred way, whether for one-off purchases or recurring subscriptions. Part of this innovation is due to fintech companies focusing on just one aspect of financial services. GoCardless is laser focused on Direct Debit and on providing the best solution for bank to bank payments.
Are newer financial organizations better positioned for the future than traditional banks?
Fintech companies aren’t hampered by the legacy systems and old-fashioned technology that make it much harder for banks to innovate. In addition, fintech companies tend to concentrate on just one or a handful of products, which means they can really focus on offering the best solution in that particular space. At GoCardless, we believe that the future will be about collaboration between fintech companies and the banks, in order to offer a transparent and customer-centric solution. What’s more, banks will be able to act as a marketplace where the customer can select their best-fit product from a number of available services, which may or may not be their own solution. GoCardless already collaborates with a number of banks and we only expect this to increase.
What user segments do you target? Do you have any preferable industries?
Direct Debit is the best solution for regular payments such as subscriptions, retainers or installments. We work across a number of industries from the traditional telcos and utility industries, which have always used Direct Debit as a payment method, all the way through to retail and SaaS where Direct Debit is often a new way to pay. As an example, Thomas Cook now uses GoCardless to offer customers the option to pay for holidays by interest free installments – a brand new way to pay, which allows holidaymakers to spread the cost of their trip at no extra cost.
How do you ensure that the payment processing infrastructure behind the service stays secure?
We use modern edge-of-network traffic management to protect our internal systems from scale and penetration attack. In addition, we protect our data by making sure it is encrypted both in transit and at rest. Importantly, security is considered a shared priority and all GoCardless staff are trained to adopt best practices and to recognise and respond proactively to security risks. This responsibility is not limited to our engineering team.
What can other companies take away from your experience?
GoCardless puts a high premium on having laser focus, which we hope is something that other companies can learn from. At GoCardless, we concentrate purely on improving Direct Debit, instead of spreading our efforts more broadly, for example by including credit or debit cards. This level of focus has allowed us to offer an excellent solution for our customers.
In addition, we believe there is a great deal of value to be generated by finding a pain point and addressing it with a targeted solution. GoCardless has taken Direct Debit, a legacy payment system that’s very well-trusted, but painful for large businesses to use and impossible for small businesses to access. We have used the power of technology to overcome these challenges, simplifying Direct Debit and bringing it firmly into the digital age.
Exciting articles several times a month