An EU-funded project to design a simple and secure means of collecting online payments will enable more SMEs to efficiently and cost-effectively access the full potential of Europe's burgeoning e-commerce market.
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The PAYPLUG LABS project addresses the needs of SMEs who wish to collect payments online,” explains project coordinator Camille Tyan, CEO of French start-up PayPlug. “What we are doing is developing a next-generation payment platform that reduces software integration costs by a factor of five and provides fraud protection thanks to modern statistical algorithms. In addition, new sophisticated technology will allow PayPlug to accurately detect risky vendors and at the same time register legitimate businesses rapidly.”
The two-year EU-funded project, managed by EASME, which began in June 2015, has led to the hiring of seven new engineers, product managers and data scientists. The company has already been able to launch a number of trial online payment and fraud prediction features, and Tyan is confident that the innovation will attract a great deal of business interest from SMEs that have until now been wary of online payment arrangements. “We have already launched a beta version of our payment API (application programme interface), and developers are welcome to check it out online and provide us with feedback,” says Tyan.
Bringing SMEs online
In essence, the PAYPLUG LABS project seeks to fill the gap between traditional online payment solutions – which require expensive integration efforts and offer limited functionalities – and e-wallet solutions that can negatively impact sales. “Up to 30 % of buyers interrupt the purchasing process when facing complex sign-up pages,” says Tyan. “Additionally, fraud detection systems are commercialised separately and rely on dated ‘rule-based’ technologies that imply prohibitive set-up costs for SMEs.”
Indeed, the complexity of setting up online payments and concerns about credit card fraud still represent significant barriers to SMEs trading online. “You can see this in the fact that the EU’s target for 33 % of SMEs to be selling online by 2015 is unlikely to be met (only 14 % of SMEs were doing so in 2013),” says Tyan. “The EU has stated that the number of SMEs selling online must increase if we are to hit our economic growth targets, and that a shift towards secure online payment technology will create a high number of jobs.”
How good ideas flourish
The PayPlug start-up was launched in 2012 to help freelancers and micro-businesses get paid, and the concept has grown from there. “We quickly built a simple online payment product, the payment request, that enabled merchants to send a link to a payment page via email or SMS,” explains Tyan. “In the first year, thousands of businesses started using this feature and thousands more contacted us with new requests: conversion-oriented payment pages and fraud protection, two needs unmet by existing providers, to our surprise.”
The current PAYPLUG LABS project will enable the start-up to fully address these concerns. The team is currently developing new payment features, data science capabilities and a robust and secure software infrastructure to support European expansion. “We are releasing new products as they are developed, so our goal is first to rapidly reach SME merchants in France, our home country, and then roll out across Europe, both directly and through channel partners,” explains Tyan.
The PAYPLUG LABS project is due for completion at the end of May 2017.