In Payments, Closed and Open, Global and Local

Open or closed?

We’re not talking about business hours — in retailing especially, the merchant’s door is almost always open in some form or another.

But for the transactions themselves — and for the acquirers and merchants who live and die by transactions — the question of open or closed can take on a different meaning. Online payments have been, and still are, evolving as a service, which brings to mind the age-old debate over hardware versus software.

In an interview with PYMNTS’ Karen Webster, Nelson Holzner, CEO of AEVI — one month into his tenure — discussed the complexities marking the payments landscape, both here and in Europe, where AEVI maintains its strongest foothold. The trend taking shape, the executive said, is one toward centralized payments across platforms that can be global in scope — or for smaller players, as tailored as their own local reach. Regardless of merchant size, the goal remains to deliver a standardized consumer online payments experience.

Across the ecosystem of digital commerce and serving merchants, he added, it’s now hard to distinguish between the pure eCommerce players and the bricks-and-mortar retailers, because everybody is using digital technology.

Only a few years ago, bricks-and-mortar operations were more analog, but, as Holzner points out, the industry has been evolving and converging. He cites pop-up stores as an example of online brands building physical outposts.

“The bricks-and-mortar guys were surprised, and to a certain extent overwhelmed, by the pace of eCommerce and how quickly online retailers ate into their bread and butter over time,” Holzner told Webster. “They’re reacting now and many firms are striving to have an omnichannel presence, but very few companies are in a position to say they have mastered that initiative.”

Overarching challenges remain as pain points, said Holzner. “Increasing conversion rates, which benefits the business while promoting a better experience for the consumer in a world where there is no distinction between on and offline, is all commerce from the standpoint of the consumer.”

The key then is that AEVI’s customers across acquirers, app solution partners and hardware vendors, who serve those retailers, need to do a good job in that transformation. The company’s goal is to bring acquirers close to their merchants and merchants closer to the customers. “Ultimately, they need to put a smile on the face of the consumer when they realize the checkout process can be much more than just paying,” said Holzner.

“As owners of smartphones, we all know apps in the B2C world,” notes Holzner. He suggests companies take this behavior that is already established and apply it to the B2B world, which can benefit SMEs as they strive to compete against larger players, especially in retail.

And it is retail that is experiencing a bifurcation, Webster noted, wherein tier four and five segment retailers — not the big guns — especially restaurants and cafes, cater (literally) to a local audience. Local players want software and technology in place that can help them grow their businesses.

Nelson Holzner says that for the smaller firms, when addressing back-office functions, across ERP or inventory management processes, they may not always have the right systems in place. That can be tough in an environment where the desires are simple. Webster defined them as selling what you came to sell, keeping up with what customers are looking for and being able to manage the business on a day-to-day basis. AEVI’s marketplace makes business apps and services easily accessible for smaller merchants through smartPOS terminals such as their own device, called Albert, or through other payment devices that are enabled by AEVI.

Speaking about the global marketplace side of AEVI’s business, which provides POS services, Holzner said, “We provide acquirers and merchant banks with a white-label marketplace solution … and they can put their brand on it and make business apps available to their retailers. The acquirers or banks define which apps will be on their marketplace and what the pricing should be. That is all under the control of the acquirer.”

Near-term goals include further expansion into the United States, said the executive, which he described as being especially receptive to less hardware-intensive technology; in other countries and regions, he sees it as necessary to bring education to the merchants and acquirers as to what you can do with the app technology at the point of sale. That education must strive to show why an open marketplace technology, via platform architecture, is better than one that is effectively a closed loop, which ties businesses to certain families of hardware.

“At AEVI, we see numerous ways to get the interest of banks and merchants,” Holzner told PYMNTS, “and put a smile on consumers’ faces.”