Derek Gallimore talks again with Miguel Warren, VP and South East Asia regional head of Payoneer. It is the leading payments platform for businesses of various range. This is the second of the two-part series featuring the company.
Miguel delves deep about what Payoneer does to change the way businesses pay their clients. He also tackles how the platform simplifies the processes of receiving international payments from freelancers to small and large businesses.
Derek Gallimore: Hi and welcome back everybody. Today, I am joined by Miguel Warren. He is the VP and Southeast Asia regional head of Payoneer. Hi, Miguel, how are you?
Miguel Warren: Cheers, Derek. I’m doing well. So nice to be back.
Payoneer and the business of trust
Derek Gallimore: Absolutely. We had you on this show previously and we spoke more about the broader outsourcing industry and how Payoneer fits into that. I encourage everyone to go back and listen.
But this episode, I want to get you back just so that we can really deep dive into exactly what Payoneer is, and more specifically, how it can help each side of the marketplace.
Thank you very much for your time. I suppose by starting if you can just give us a brief intro of what exactly Payoneer is and how you’re on this mission to reduce the friction of globalized trade?
Miguel Warren: Sure. First off, Payoneer is a global cross-border payments platform that helps businesses of all sizes pay and get paid internationally as easy as they do locally.
We partner with 10s of thousands of leading digital brands in different industries and verticals, whether it’s in freelancing, so companies like Upwork, Fiverr, freelancer.com, or e-commerce with the likes of Amazon, Lazada, Shoppee, and even Vacation Rentals like Airbnb.
We serve different industries and help these global enterprises payout to hundreds of countries in hundreds of different currencies on the receiving side.
We actually offer a Payoneer account, which is like a cross-border payment platform that you can use to either receive funds from any of these marketplaces or from direct international clients. We allow you to receive in many different currencies and then transact locally.
Derek Gallimore: The key to this is that you really specialized in globalized payments, don’t you and making, I suppose all of the regulation and compliance done for you smooth, no problem at all.
But then also, there’s efficiency in terms of the exchange rates, the currencies, managing different currencies and paying out to different suppliers and people across the globe.
Miguel Warren: Absolutely. Thank you for saying that because that is one of the things that we aim to do. We aim to make it a very user experience-focused product, meaning that you’re not worried about how to get paid, you’re more worried about your business.
We do that by simplifying, making everything digital, and reducing the friction through better exchange rates locally, and even faster settlement to your local bank.
We also offer optional MasterCard debit cards that give you instant access to the funds in your account in different currencies.
International payment barriers
Derek Gallimore: FinTech is really in vogue at the moment. It seems that every 18-year-old fresh out of school is talking about setting up a FinTech. Payoneer, you’ve been in the industry a long time now and I’m amazed at.
All of this innovation is great, but you really need a solid provider to make sure that all the I’s are dotted and T’s are crossed. What can you say in terms of where you come from and the complexity of the systems that you’ve built?
Miguel Warren: Absolutely. Again, I always like to say that this is a business of trust. Right? It’s a very important element when it comes to payments.
That trust is built by number one, making sure that you are always compliant to local regulations as it relates to cross-border payments; number two, you’re always looking to be able to improve the speed and improve the cost of receiving international payments.
When you think about where international payments started out, kind of looking at traditional cross-border payments, what’s very interesting is that when you look back at the start of the marketplace, platform era when eBay first came around in the 90s, people would do the transaction online, but they’d do the payment offline.
They’d be sending each other physical checks. You can imagine this is not a very efficient way of doing business. Checks can get lost, they can get damaged, they can get stolen.
Then when you finally receive the check, and if it is an international payment, it could take another three, four weeks for the funds to clear. I remember having spoken to many small businesses who started their outsourcing business years ago.
They recounted stories of receiving a check for 50 US Dollars and how it took three weeks for the funds to clear and how the fees on that $50 basically whittle down all the profit.
Payoneer, recognizing the challenges of trading cross-border payments, has created this platform that makes it easier and more convenient to transact, whether small amounts or large amounts and much easier to connect, whether it’s through a marketplace or directly with your customer.
Derek Gallimore: It’s about really getting the interface set up, isn’t it? I think with Payoneer, the key is getting it set up and then plugging in the various use cases. Then it’s just like, a dream of a system.
As opposed to, it’s still incredible for me to think that in the US, one of the most advanced economies in the world, people are still paying each other by cheque very commonly.
It’s a different process. If you want to pay someone internationally, you might even have to go down to your bank, and then you might have a separate credit card, and then you got to make payments to that.
All of this is, it’s just so disjointed, isn’t it? Especially then, when you add in regular international payments and web of different suppliers and clients, once you’re in this dashboard, it’s just all a dream and you just direct funds where you need it.
Miguel Warren: Yeah, cuz when I’m even taking another step back in terms of, maybe the check was a little bit of an extreme example. Most people these days, they use international wires. But even international wires isn’t always a very pleasant user experience.
Your bank and your customer’s bank actually need to be connected. If your bank is a large global multinational bank, like a Citibank or an HSBC or a Standard Chartered, that’s normally no problem.
But many people don’t want to park 10s of thousands of dollars with very little interest in these large global banks. They will open an account in a local or regional bank. This bank may not be connected to the bank that is used by a small business, for example, in the Midwest in the US.
What would happen in order for these two banks to connect, they would need to go to a third, maybe a fourth bank, a correspondent bank to bridge that gap. Every time the money moves from one bank or one entity to another, there’s a cost implication and time delay.
There’s a forex implication, and the result is you’re waiting longer for your money. It’s costing you more for your money, and you’re having to potentially even provide physical documents to make sure that you can clear the funds in your account.
What Payoneer tries to do is we try to digitize that process. We try to dramatically reduce the time it takes to receive international payments. I think we’ve done that in the Philippines quite well, where we’ve now been able to meaningfully reduce the time that it takes for a freelancer or an SME BPO to receive the funds in his bank in the Philippines.
Derek Gallimore: That’s critical, isn’t it? Because it’s not just where the person’s paying from. It’s how the other person receives it. And as always with banks, typically, there’s always these additional fees.
They charge their own forex rate and receiver fee, and it’s just crazy plugging all this together.
Miguel Warren: Yep.
Derek Gallimore: Good. In terms of our audience, we have a lot of BPOs. We have a lot of freelancers here based in the Philippines. Also, we have a lot of users of the globalized workforce. Who does it best fit and who does it work for?
Miguel Warren: Our platform works for both the payer and the receiver. If I can talk about the receiver First, the receiver is that freelancer, SME BPO, or even larger BPO enterprises. They need a cost-effective and convenient way to receive funds in multiple currencies and through many different payment methods.
They can easily and conveniently sign up for an account on payoneer.com and everything is entirely digital, no paper forms, nothing to sign, will ask for some documentation, but then off you go.
Once you have a Payoneer account, you have different ways to request and receive payment, whether it’s connecting your Payoneer account to a global marketplace platform or receiving funds via credit cards or E-checks in the US.
We even have virtual receiving accounts which basically allow you to have almost like a local receiving account in different currencies. You can provide this account number to your customer in the US, the UK, Europe or even Australia.
All they will need to do is make a local transfer in local currency instead of sending an international wire.
Many BPOs find this useful because number one, they don’t have to travel all the way to these different countries and open a bank account, and number two, they’re able to show that hey, I am an experienced BPO that maintains an account in multiple different currencies.
We also help build that credibility that they know how to deal with international clients and international payments.
Derek Gallimore: That’s such a big thing, isn’t it? I coach BPOs and freelancers all the time. You’ve got to present yourself as professionally as possible. And as you mentioned this trust and credibility, and you don’t want to go and request the client to get a Western Union and make a payment.
Payoneer is so cool. It’s a little bit like the virtual offices and Regus, how I can, with a few clicks, have a Citibank account in the US and Lloyd’s account in the UK and it’s all right.
To your business name, your identity, (…) organization within minutes, doesn’t it?
Miguel Warren: Absolutely. Yes, as you were saying. I like that advice that you’re giving to the people that you coach because it is super important to build also credibility to the client-side and trust to the client-side. Outsourcing is a highly competitive industry. Oftentimes, it’s about, finding the lowest cost.
It’s important that you set yourself apart from the pack. It’s important that you’re able to present a very professional face to your potential customer. It’s also very important that you give him the convenience of options.
Maybe he doesn’t want to pay with a credit card. Maybe he wants to pay with his bank account. Maybe he already has a Payoneer account because he’s Amazon seller and he wants to pay you straight from his Payoneer account.
All of these things are possible. It gives you multiple ways to receive funds from international clients.
More flexible transactions
Derek Gallimore: Client-side, then, I imagined, no one’s called Business Banking really just needs to exist in the background. It needs to run smoothly. I imagined from a client point of view, it’s about the cost, speed, and whatever functionality they need. How do you find it resonates mainly with clients?
Miguel Warren: With clients, it is actually about speed, cost convenience, but it’s also about what people are typically using. I think in countries like the Philippines, we’ve been there. We’ve opened an office in 2016, as I might have mentioned, and we’re starting to really see a very strong positive response to Payoneer.
Many are now asking to be paid into their Payoneer account and it feeds into the client or the centre side of the US where they kind of look at their net. Okay, so my Freelancer wants to get paid by Payoneer. Let me take a look. They get now sign in or create an account as a payor.
And with this payor account, they can now link multiple payment methods, they can pay all of their freelancers. It’s fast, it’s convenient, it’s digital. Very easy, very cost-effective, and very good user experience.
Derek Gallimore: Cool, isn’t it? I just geek out on the functionality and the things you can do and whereas previously, there were just so many barriers to this, so many forms to complete, and it’s really (…)
Miguel Warren: Yes, the forms and the stacks and the documents and stuff. Never any fun. That’s why it’s so cool that we’re really focused on the user experience and making it easier to pay and get paid.
General e-commerce platform
Derek Gallimore: Absolutely. And we’re deep into the outsourcing and offshoring and freelancer world, but you pretty much cover every platform. You’re basically the e-commerce specialist.
Miguel Warren: Yes, indeed. Aside from services we also focus on e-commerce. We help sellers from all over the world receive funds from the largest global marketplaces like Amazon, Lazada, Shoppee.
Also, we enable a lot of direct b2b trade through many different ways including some of these receiving accounts, also through things like wires and direct payment from one Payoneer account to another.
Derek Gallimore: For me, of course, I use Payoneer. I encourage everyone to use Payoneer whether they’re on either side of the marketplace. It just streamlines everything. This isn’t an infomercial, but I think that when people are engaging in these new activities, offshoring, going global, they need all the tools in the tool kit.
They need to know what is available and open to them. I really appreciate your time to talk about this and to let people know. Of course, people should explore this. People should check-in and just be aware of their options.
Because if you’re doing stuff the old way, it’s so important to know that there are easier and better ways of doing things. I hope that these episodes can bring light to that. I really appreciate your time, Miguel.
If anyone wants to when you suggest that people go to just dip their toe in or learn a little bit more about Payoneer.
Miguel Warren: Absolutely. Anybody interested to learn more about how Payoneer can help you simplify your international payments, go to payoneer.com. You can also learn more on our Facebook page, our LinkedIn page, we’re on all the major social platforms.
We also have offices in many countries in Southeast Asia. We are a New York0-based company. We are a global company. Myself, I’m always excited to get connected to freelancers, SME BPOs, to companies that are contemplating globalization or doing global business.
Search me up on LinkedIn, Miguel Warren, Payoneer.
Derek Gallimore: Fantastic. Thank you, Miguel.
Miguel Warren: Cheers, Derek, thank you so much for inviting me again.
Derek Gallimore: That was Miguel Warren of Payoneer. If you want any of the show notes, go to outsourceaccelerator.com/276. And as always, if you want to ask us anything, then just drop us an email to [email protected]. See you next time