At the end of 2017 the world of payments reached a milestone, for the first time in history the number of debit card transactions overtook cash payments. With all the hysteria surrounding the crypto-currency market on top, David Dungay thought it was about time he explored what these trends mean for the Channel. David sat down with Carl Churchill, Owner and Managing Director of NetPay, to discuss the latest trends in payments.
Comms Business Magazine (CBM): Carl, you have been around the payments market for a while now with NetPay, can you give us a top view of how business is going?
Carl Churchill (CC): We service about 13,000 customers now through our Channel Partners, the growth on that side has been very good, billions of pounds of transactions per year, on the other side of the business we also have a huge amount of growth. We process applications for about 8,000 businesses across the world every month and deliver technology into about 15 different countries now. We won a deal recently to expand our reach to 24 countries. A lot of our time is going into closing off those deals which are typically with large banks.
If we just take the UK, we own about 34% of the merchant services market, i.e. 34% of all merchant services will come through our technology. We only really launches that business at the start of 2017, so it’s pretty phenomenal growth within a 12 month window. We also just won a deal to deliver technology into every Subway restaurant in 12 countries… from Australia to most of Europe, they will all be using our technology to get access to payment services.
CBM: Wow, what do you put that growth down to?
CC: We came out of the telecoms space having learned some valuable lessons about how to automate low margin services, we were in broadband before which was a low margin game.
To make money there you had to not really get involved in the provisioning side of things. We took those lessons into the payments arena. When we started there were salesmen walking around with 30 pieces of paperwork for a customer to sign… we thought there has to be a better way to eliminate the paper and switch to an electronic process without compromising the fraud and risk elements of the process. We took the mean delivery time from 2-3 weeks down to 24 hours.
That really struck a chord with a lot of banks that were struggling to make this work. Under the old system banks would only see about 50% of orders go live because customers would get buyer’s remorse, couldn’t be bothered or had another priority within their business to focus on.
We are focused on driving growth and building on the last 12 months of success, on an annualised basis we are over £7 million now. We always wanted to build a global business so we are now looking at having a physical presence in Australia, Atlanta, and somewhere in mainland Europe.
CBM: There has been a lot of mainstream media coverage of the crypto-currency space recently, do you see this as the next Channel disruptor in payments?
CC: Absolutely, crypto currency is the current ‘thing’ in our market which has the potential to disrupt things further. I think the technology behind crypto-currency is where the disruption will come from. Blockchain can be used in so many other things other than currency itself so could be an interesting one for the Channel. People are exploring Blockchain to do things like secure voting, storing medical records and other types of encrypted data. There is no centralised architecture so it’s incredibly secure. From a channel perspective I think Blockchain will start changing the IT space, customers will start enquiring about how they can use Blockchain to make their data more secure before too long.
The future of telecoms is in the business services play. A lot of telecoms players are naturally going into IT but the lifeblood of every business is payments. Every business accepts payments in some form or another. There is also a certain amount of common ground between a telecoms and a payments deal. The way in which you would analyse bills, the commercial models and sales approach are very similar. It’s also a growth market as we know people are using card payments more than ever, it’s just a great value-add proposition which we believe should be near the top of partner’s priority list.