Interview with Yandex.Money Mobile Acquiring Representative

Now in Russia there are not many people who have never paid off the card. The latest MasterIndex survey data (MasterCard annual survey) suggests that already 91% of cardholders pay with a card in supermarkets and hypermarkets, and 46% pay with a card more than once a week. To accept cards at points of sale and service, it is not necessary to go to the bank at the POS terminal - it is easier and faster to get mPOS - a small mobile device that is inserted into a smartphone and allows you to accept payments from bank cards using a mobile application. About how mobile acquiring is developing, who uses this service and how secure it is, the editor of Web-payment.ru , a project about payment services, talked with Oleg Nikitin, head of mobile acquiring development Yandex.Money



Mobile acquiring in Russia exists not the first year. What are the intermediate results?

Mobile acquiring in Russia began to develop only in 2012, when the first startups appeared - 2can and Lifepay. Market participants estimate it differently, but its annual volume is estimated at billions of rubles - obviously, mobile acquiring is a rather demanded service.



Mobile readers are actively using small and microbusiness, which for various reasons mobile acquiring is more convenient than traditional bank terminals. For example, one of the advantages is the compactness of the mobile devices themselves, which is especially important for online stores offering goods with delivery. In addition, any legal entity can get a reader regardless of their monthly turnover - you need to pay for the reader once, there is no subscription fee for its use.



For which categories of clients is mPOS interesting?

From our own experience, we see that completely different categories of customers - from taxi drivers to fairly large online stores or charitable organizations - use mobile acquiring. Our experience shows that mPOS terminals are in high demand among online stores selling physical goods, insurance agents, as well as companies selling construction goods. In addition, companies that provide various services, for example, training or repair of residential premises, use the service rather actively.

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Are there any trends in mobile acquiring, or this service does not change?

All market players agree that in the next 3-5 years mobile acquiring will either be replaced by contactless payment acceptance, technologies for which are being developed now, or will be organically developed as a comprehensive service for small and medium businesses that will remove the lion’s share of pains - accounting, tax reporting, acceptance of payments on the website, loyalty programs, etc. Mobile acquiring in this package will be only one of the options.



Already, all those services that provide mPOS-acquiring, try to give the client a comprehensive solution that will save him from several problems of the entrepreneur: payment acceptance, accounting, fiscalization or loyalty programs. It is in this configuration that we see the future of mobile acquiring in our country: a stand-alone mPOS terminal will not be in demand, but it represents an important component in a package with other services for legal entities.



As for Yandex.Money, this line of business has taken its niche in our business — the customer gets a ready payment solution from Yandex.Cash, with which you can receive payments both online (from e-wallets, cards, Internet banks, from mobile numbers and terminals), and offline, using mPOS.







How does the typical mPOS business model work, how are the commissions distributed between the participants of the settlements (bank, operator, payment system)?

ThemPOS terminals themselves are sold at cost, i.e. the cost includes only the cost of the reader, packaging and delivery to the final recipient. Terminals are purchased abroad, so their price is highly dependent on the exchange rate. In this regard, in the first half of 2015, all market players had to revise their tariffs for the sale of readers. In the business model of our mPOS project, there are 3 components: the bank’s commission, our partner’s commission — 2can and the Yandex.Money commission. Most part falls on the first component, since bank charges include payment system fees. But in general, the commission for mobile acquiring is about the same for all market players.



Speaking of mobile acquiring, which is better: develop from scratch or use a white label?

The Yandex.Money mobile acquiring project is a pure white label - it would be unprofitable to develop such a project from scratch. It would require certification in payment systems, finding, ordering and clearing mobile terminals themselves, as well as linking their specification to the processing center — all of this would have turned into quite serious investments. Whereas in the case of the white label, all that is required of the company is to integrate mobile terminals into its infrastructure and processes. To invent a bicycle is completely pointless.







In addition, now our partner 2can offers companies work in 2 directions: on the one hand, you can make a full-fledged white label, which means quite a serious integration of the company's systems and a technical partner, and on the other, you can work on an agent scheme, when your company is just transfers the necessary clients to the partner, and you get a commission on this. In the second case, you still have the opportunity to build mPOS into your product line, but with minimal cost for yourself.



White-label Yandex. Money has fully justified itself: we have our own fairly advanced back office or personal account for the client. By maximally integrating this product into Yandex.Kassa, we can provide customers who conduct online business with all services for accepting Internet payments “in one window”.



What are the best ways to promote mobile acquiring?

To promote mPOS terminals, they use all standard mechanisms - contextual advertising, partner networks, and direct sales to existing customers. In our case, mPOS is part of a comprehensive Yandex.Cashy offer that allows you to connect mobile acquiring along with the integration of various online payment methods. Therefore, we use a variety of methods to attract customers to Yandex.Kassa, including the product site kassa.yandex.ru. Mobile acquiring is not ordered by all customers, but among small online stores with physical delivery this is quite a popular solution.



How secure is mobile acquiring?

Since February 2014, all market players have switched to using terminals with EMV support, this was a fundamental requirement of Visa. Now, with regard to security, we can even be ahead of the United States: on the American market, payment system rules still allow calculations using magstripe terminals that can read only a magnetic strip, and the well-known Square has just begun the transition to EMV. In addition, existing players actively use the antifraud systems of their acquiring banks and set up their own systems to counter fraudulent transactions.