Online payment systems 2013 City Library Manchester
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Online payment systems 2013 City Library Manchester Online payment systems 2013 City Library Manchester Presentation Transcript

  • E-Commerce Made Easy Zulf Choudhary Director Supported ByCopyright Sparta Technologies 2013 t/a SpartaPay
  • Content 1. About Us 2. What is e-commerce? 3. Whys is it critical? 4. Basics 5. Factors to consider 6. Risk based costs 7. M-commerce 8. Solutions to suit you 9. PSP’s 10. The right software 11. Summary 12. Appendix ListCopyright Sparta Technologies 2013 t/a SpartaPay
  • About us We create bespoke mobile and web platforms  Software outsourcing and social banking for over 10 years  Social engagement and inclusion specialism  We are a spin out from The University of Manchester  Staff with IT backgrounds from private to public sector  Good knowledge base at the Manchester University Voted best EU IT Project 2007Copyright Sparta Technologies 2013 t/a SpartaPay
  • What is e-commerce? Electronic commerce, commonly known as e-commerce or eCommerce, or m-commerce, consists of the buying and selling over electronic systems such as the internet and other electronic networks or channels. Online Examples: 1. Amazon-book store 2. Dell-computer systems 3. EBay-exchange market place 4. PayPal-online payments 5. Banks Mobile Examples: 1. Catapult madness 2. Angry Birds 3. Paddy PowerCopyright Sparta Technologies 2013 t/a SpartaPay
  • Why is it critical? Internet changed buying behaviour: How, when, why • E-commerce sales represented an increase of 19% of total turnover in 2011, up from 18% in 2010.* • In 2011, 81% of businesses had a website. • Over half of businesses (56%) provided at least one member of staff with a ‘portable device’, such as a portable computer, smartphone or personal digital assistant (PDA). • In 2011, the estimated value of e-commerce sales was £483 billion. • Sales via mobile devices representing 37% of our total online revenue.** •http://www.ons.gov.uk/ons/dcp171778_289328.pdf •** http://www.internetretailer.com/2013/01/22/uk-e-commerce-will-increase-12-2013Copyright Sparta Technologies 2013 t/a SpartaPay
  • One example 25 billion songs downloaded by via iTunes by end of 2012 http://www.digitalmusicnews.com/permalink/2013/20130206cannibalizationCopyright Sparta Technologies 2013 t/a SpartaPay
  • How online payment gateways workCopyright Sparta Technologies 2013 t/a SpartaPay
  • Setting up a basic ecommerce system What you need 1. Online merchant account Banks 2. Ability to accept cards payments Payment Service provider or PSP 3. Provide Security-HTTPS Security providers 4. Provide order forms or a shopping cartCopyright Sparta Technologies 2013 t/a SpartaPay
  • Factors to considerCopyright Sparta Technologies 2013 t/a SpartaPay
  • Costs, excluding website expensive Main costs are listed below but are not relevant to all products • Setup Cost: ranges between £50 and £250, i£120 is the average. • Annual Cost: normally around £150 but often not applicable. • Monthly: The most standard charge especially from acquiring banks, around £10-25 pm. • PSP: Can be a commission of as little as 1% but often about £10 per month or 3-4%. • Transaction Charge: 2.79% for an established business but up to 4-7% otherwise. • Bond: dependant on exposure level but is often negotiated down. • Charge-back £7 to £29 for each item • Mobile Payments fees 5% to 30% per transaction Example of costs Set-up Recurring costs Transactional charges 2% - 3.35% per credit card transaction Merchant account £200 £10 £0.25 - £0.35 per debit card transaction NetBanx PSP £75 £10 from 1% to 6% per transaction Worldpay £200 £360 (annual) 4.5% credit cards, £0.35 debit cardsCopyright Sparta Technologies 2013 t/a SpartaPay
  • What is exposure to risk? Risk exposure is what the acquiring bank estimate of the total risk you are exposed to at any one time; for instance, the number of sales open to refund over a given period. Your exposure level will also affect the charge bands offered by banks to your business, i.e. monthly fees and transaction charges.Copyright Sparta Technologies 2013 t/a SpartaPay
  • Charges based on risk A bank looks at their exposure to risks to you and your customers before agreeing to give you a online account. Why? • Fraud and charge backs = cost of doing online business with you. • Charge-backs, when a customer demands a refund from their credit card company. • Banks protect themselves against charge-backs by retaining customer payments for a time before crediting your account. • Internet transactions can be prone to fraud. • You may need to lodge a bond to cover yourself against fraud. • Good terms and conditions on your website will help. In perspective: Fraud represents only 15 to 30 minutes of loss in a full year of trading for many banks. So why concerned?- Brand ReputationsCopyright Sparta Technologies 2013 t/a SpartaPay
  • M-commerce Collecting Payments via mobiles-just a summary Has its own risks • Mobile provider gateways and shopping malls -iTunes, OVI etc • Reverse Billing-cost to your mobile account-BT • Mobile banking-Banks • eticketing via SMS, concerts, travel etc. • Premium rate lines- adults, gambling- all telecom companies • Mobile Payments fees 15% to 30% per transaction to app store Why? • Convenience • Simplicity • Direct into handCopyright Sparta Technologies 2013 t/a SpartaPay
  • Solutions suited for you This depends on a number of factors: • Customer segment • Your product • Buyer behaviour • Bank charges and costs • How traffic is driven by your marketing • How to get them to pay? The secret: know your customers!!! Source: http://www.iabuk.net/en/1/iabknowledgebankaudiencefactsandfigures.html *http://www.atelier.net/articles/juniper-mobile-application-market-worth-25b-2014Copyright Sparta Technologies 2013 t/a SpartaPay
  • The right PSP? PayCopyright Sparta Technologies 2013 t/a SpartaPay
  • Your choice • Based on your website software • Research your market • Costs per transaction plus charges consideration • Your business model • Legal issues • Being in control • Your budget The key is : Do your homeworkCopyright Sparta Technologies 2013 t/a SpartaPay
  • The right software 1 A. Open source platforms Open source essentially means that the source code is open and freely available to anyone under the terms of a General Public Licence (GPL). This means developers can distribute, modify, integrate and customise the software as long as the original developer is credited. Open source is perfect for a start-up or small business, you can do it yourself. Popular software for e-commerce platforms are: • Joomla • Wordpress • Magneto • Zen Cart etc Issues: cost of hiring developers hourly or by the dayCopyright Sparta Technologies 2013 t/a SpartaPay
  • The right software 2 B. Software as a service (SaaS)/ licensed platforms Software as a Service means you are renting use of the software rather than owning it outright, often hosted online in the ‘cloud’. SaaS platforms can be configured, designed and set-up to suit almost any business (depending on the features available), however the difference is that third-party developers do not have access to the source code and therefore cannot customise it in the same way as open source. The advantages of SaaS platforms are that by paying a relatively modest licence fee, someone else takes responsibility • Updates • Security • New features Issues: dependent on the supplier building & releasing updates, costs going up etc.Copyright Sparta Technologies 2013 t/a SpartaPay
  • The right software 3 C. Bespoke- things to consider Vouchers Market Social Place media Customised Ideal for bigger merchants expect design to pay between £3,000 to £30,000 for basic. Search & reviews Newsletter Issues: your budget, expertise dependencyCopyright Sparta Technologies 2013 t/a SpartaPay
  • Summary Electronic commerce is about online selling, taking users to a place they feel secure and happy to buy goods or service. Many issues can trip the unwary but if you think rationally and positively you could make millions. Consider the following: - Online and mobile channels (do not forget that TV, radio and newspapers all depend on e-commerce of one type or another!) - Map out the total user experience with you - Look at your budget. - Look at all the risks. - Decide on payment gateway provider. - Negotiate the best deal from your payment provider or bank. - The set-up costs may been high and the work daunting but its worth it. The market is worth over £120 billion by 2014!Copyright Sparta Technologies 2013 t/a SpartaPay
  • Thank you Telephone: 0161 306 5848 Email: info@spartapayco.uk Address: Spartapay University of Manchester Arch 29, PO Box 88 Sackville Street Manchester M1 3NL www.spartapay.co.ukCopyright Sparta Technologies 2013 t/a SpartaPay
  • List of gateways or other types of service providers This is not an exclusive list-please search the web for more providers Name Address Buck.net http://bucks.net/ ePDQ Barclays bank http://www.barclaycard.co.uk/business/ Skrill http://www. Skrill.com/app/ Netbanx http://www1.netbanx.com/ NoChex http://www.nochex.com/ PayPal http://www.paypal.co.uk/uk PayPoint http://www.paypoint.co.uk/ PO MoneyGram http://www.postoffice.co.uk/ Splash plastic card http://www.splashplastic.com/ Streamline http://www.streamline.com/ SecureTrading Merchant Account http://www.securetrading.com/ SecPay-owned by PayPoint http://www.paypoint.net/secpay-payment-gateway/ RBS WorldPay http://www.rbsworldpay.com/ Apple-mobile http://www.apple.com Ovi Store-mobile https://store.ovi.com/ Icon-mobile http://www.iconmobile.com/start/ Source http://www.electronic-payments.co.uk/solutions/ Feb 2013Copyright Sparta Technologies 2013 t/a SpartaPay
  • Free official help and advice http://www.manchesterdda.com Digital help http://www.go-on-manchester.com/ Digital help and advice http://www.a2fnw.co.uk/ Access to grants and funding https://www.gov.uk/business-finance-explained/investment-finance Business Finance explained https://www.gov.uk/employment-contracts-and-conditions/overview Contracts https://www.gov.uk/online-and-distance-selling-for-businesses Online selling rules http://www.oft.gov.uk/business-advice/treating-customers-fairly/dshome/ More on online sellingCopyright Sparta Technologies 2013 t/a SpartaPay