Interview with Gox Mailer, IXOPAY, on cross-industry partnerships after PSD2 and GDPR

Could you elaborate a bit on the company’s background, its target markets and the specific needs of these markets?

Here at the IXOLIT group, we’ve been watching the payment space closely for many years and from many perspectives; firstly, from the merchant perspective, integrating and maintaining countless solutions for our clients, providing them with compliance tools and also optimising risk and fraud setups for them. Secondly, from the technical PSP perspective, handling acquiring relationships and trying out many white-label products, none of which ever satisfied our quality standards (or those of our merchants).

With our IXOPAY gateway offering, we try to fill the niche located exactly in the “golden middle” between these two points of view, creating win-win scenarios for merchants and their PSPs / Acquirers by providing them with maximum flexibility and true, global, scalability potential.

(IXOPAY Payment Gateway - Dashboard. Click to enlarge)

How do PSD2 and GDPR affect the payments industry?

I believe that the growing regulatory pressure has led to a consolidation of the market in recent years; we see the many cooperations between traditional banks and young fintechs, we see a growing number of mergers and acquisitions in the larger player segment, and personally, I also see a trend of professionals moving from the merchant to the processing side and vice versa.

Simultaneously, we see more and more merchants expand their acquiring portfolio and switch processing solutions more often than they used to. I’m also under the impression that merchants concern themselves more with regulation and compliance in principle due to the relatively extensive media coverage of these topics.

All of this results in the lines between merchants, processors and solution providers becoming more fuzzy and know-how being transferred quickly in all directions. I’m convinced that the near future will bring an evolution away from classical competition towards mutually beneficial cooperation.

(IXOPAY Payment Gateway - Transactions Overview. Click to enlarge)

As the number of fintechs grows, what do they need to keep the upper hand and what can they do to survive in the sea of competitors and regulations?

I think it’s safe to say that the most agile, the most flexible players will be the ones that survive (putting aside the wave of “grey area” ICOs, which are a separate, more complex topic). As is the case with any evolutionary stage, those who bring the toolset needed to quickly adapt to the ever-changing conditions will have a strong advantage - I feel that co-operation with (not exits to) traditional players can be part of a successful strategy, but also putting an emphasis on ecosystems and creating services that can be somewhat easily embedded in them (SCA/XS2A, Robo-Advising, KYC, real-world blockchain applications, etc.).

Merchants need to lower costs while at the same time driving conversion. What type of partnership can help them hold their ground, be more flexible and avoid the stress that comes with complying with the regulations?

As merchants become more knowledgeable, they also require more and better tools to drive optimisation; for example, once you gain insight about inter- and intra-regional fee structures, you are only then in a position to utilise smart routing functions to save on them (and on a certain level of transactional volume, the savings can be significant). Or you’re only able to identify certain fraud patterns and expansion potentials with things like error messages being handled transparently and easily accessible in your BI and reporting tools.

More traditional approaches, like partnerships with 3rd party risk and KYC solutions providers can be very helpful as well, but the foundation of any sustainable payment setup should be a scalable (also in terms of upcoming payment methods!) gateway that includes easily applicable volume balancing functionalities and a provider-independent PAN-vaulting solution.

You will soon be attending Money 2020 – can you share some expectations on the event and what you plan to debate upon while there?

We expect to do a LOT of networking. We already have a “Preferred Partner Program” for Acquirers and Payment Facilitators in place and we are planning to roll out a similar system for Solution Providers - Money2020 Europe is a great place to discuss these efforts with our industry peers, face to face. So, the focus will surely be on cooperations and partnerships, but I might just do some hiring as well.

About Gox Mailer

Gox Mailer looks back on a strong consulting background in various positions in the IT, Film and Advertising spaces, both on the agency and the client side and, in the last decade or so, has put a strong focus on online payments. He’s joined the IXOLIT group in 2010 to help it enter this space, advised enterprise clients, handled strategic business development of the internal PSP, created the brand for the purchased.at joint venture and spawned the development of the IXOPAY gateway.

About IXOPAY

Being part of the IXOLIT Group, IXOPAY GmbH has created its gateway to ease typical payment processing pain points for both Enterprise Merchants and PSPs/ISOs. The modern, easily expandable architecture provides intelligent Routing & Cascading functions for the former, as well as state-of-the-art Risk and Reconciliation Engines for the latter.