Daniel Mayhew is UK Country Manager for Payoneer, one of the world’s fastest-growing online money transfer and digital payment services. Fintech Disruptors 2019 caught up with Daniel to get his views on the future of fintech, the digitisation challenges facing banks, and what fintech can do for merchants around the world.
Fintech Disruptors: Your company has been growing at an impressive rate. Can you tell us what challenges and opportunities this has created?
Daniel Mayhew: In spending time with our different teams around the world, I have seen Payoneer’s strong culture in operation – probably our biggest advantage. We help businesses remove the barriers to cross border trade, either by helping them access new markets, or providing new technologies that enable frictionless connections between buyers and sellers globally.
Another opportunity for us is innovation. We have amazing teams around the world working in innovation hubs, whether it’s working on small but important advancements to existing technology, or completely new products that address customer needs, such as helping small and medium businesses (SMBs) manage working capital. SMBs are at the heart of what we do: we’ve built a massive ecosystem of marketplaces and small businesses. Big marketplaces such as Amazon want to be connected to more sellers, who want to connect to marketplaces so they can enter new geographies at scale. We’re in the right place to bridge that gap.
As regards challenges, regulation will get tougher, both internationally and locally. Over the years, we’ve become experts at regulation, and can work with regulators at any level, from automation to customer care or client onboarding.
Fintech Disruptors: What does the year ahead look like for you?
Daniel Mayhew: We’ll maintain our global growth objectives. Thankfully, there’s an ever-increasing demand for our services. We have set up shop in the UK and Europe, and are busy installing a robust operation to scale up to meet demand for our services. We’re look forward to being a growth partner for thousands of businesses. We are introducing innovative new products such as the working capital solutions I mentioned earlier, or our VAT and store manager products.
I also expect to see us working with thousands more online sellers around the world in 2019. For instance, a European sports-focused business wanted to enter Japan, the world’s fourth-largest e-commerce market. We were able to support them via our Japanese team at every step – right up to going live on the Japanese market. In Russia, we’re expanding with both Yandex and MyMall, owned by Mail.ru. These major Russian tech companies are ready to open up that market with Payoneer. This is a massive opportunity in a huge market for us.
Fintech Disruptors: What themes do you think will dominate in 2019?
Daniel Mayhew: I can see no signs of the record-breaking growth we enjoyed in 2018 slowing down, with online cross-border retail predicted to grow twice as fast as domestic ecommerce into 2020. To support this explosive growth, you’ll see a continued push from incumbent payment gateways to promote their omni-channel solution and acquire transactions via regional alterative payment methods. The main objective for online ecommerce is to provide overseas shoppers with a frictionless buying experience as if they were shopping in their domestic market.
Brexit will also make businesses in the UK concerned about their relationships with the EU. As people start to think about the post-Brexit world, there’s more interest in looking further for new markets, such as Asia. The new, disruptive financial institutions will continue to grow, with obvious signs of segmentation developing. You may start to see consolidation, with some of these new firms which have been ‘mainly’ domestic develop ambitions to go global or target B2B. You will likely see some major partnerships formed, or increased M&A activity in this space.
Finally, we predict you’ll see more on-line stores that have traditionally sold directly explore the option of selling through marketplaces as part of their overall customer acquisition strategy. There is no denying the benefits of selling through marketplaces, either cross-border or domestically. They are an attractive option, low risk, low cost, with a loyal customer base, integrated fulfilment and an entire eco system of vendors that provide auxiliary services.
Fintech Disruptors: How is fintech enabling merchants on their digital journey and helping to grow e-commerce?
Daniel Mayhew: We are witnessing a transformation in the way businesses pay each other for goods and services around the world. Many fintech providers aim to remove barriers to cross-border commerce. Ultimately, fintech competes against inefficient and dated payment methods such as cheques and SWIFT payments. Fintech’s ambition is to provide users with a more digital, cheaper, faster, and more transparent solution that’s suitable for modern day global e-commerce. Small businesses all over the world are becoming increasingly connected through an endless stream of technologies. We believe this trend isn’t going to slow anytime soon.
Fintech Disruptors: Finally, how banks are grappling with deep digitisation?
Daniel Mayhew: The incumbents aren’t sitting back and watching disruptors acquire their customers without a fight. They are busy rolling out improved digital banking experiences, products and features, meaning that the challengers need to move fast to acquire as many customers as possible before the incumbents launch new services. Disruptors have proven very effective at acquiring new customers. The larger incumbent banks face the problem of working with legacy systems and long, drawn-out gating processes for innovation. In my view their slow delivery of innovation is their biggest risk, especially compared to the high velocity, well-funded, digital and mobile disruptors.
However, incumbents have the advantage of ready-made existing services like Direct Debit. Major banks can offer these services alongside connections to the Faster Payments network, SWIFT, underwriting capabilities and deep liquidity networks.