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Insights and Expertise
When the infrastructure was are absent at the checkout page, customers can
built for a different game rightfully feel disappointed, which directly affects
authorization rates and conversion performance.
Regulation and taxation are still based on the outdated • Settlement timelines add another layer of difficulty
approach whereby people live in the same country in which
they were born and assumed to do business only locally. because a company built around near-instant or
next-day cycles can suddenly face serious cash
However, as the world became global, so did businesses,
which means it is very hard to pinpoint where online flow problems when multi-day holds become the
norm. That shift requires strategic working capital
businesses actually operate. Where does the director make
decisions? Where is the company incorporated? Or where planning, including access to bridge financing or
expanded cash flow buffers.
does it serve its customers?
• Success carries inherent risk, too: a sudden volume
Taxation arbitrage, where a company is set up in a certain spike in a newly activated region, for example, often
country just to pay lower taxes but operates globally, is triggers enhanced monitoring, which might result in
one of the major issues today. As banks and financial temporary suspension of services, leaving growth
institutions are the "policemen" of the economy, aimed to focused teams managing regulatory and liquidity
filter and block all such questionable activities, this creates challenges they have never been trained on instead
a regulatory and taxation discrepancy between local and of scaling operations.
global fund movements. • Sanctions screening and geopolitical sensitivity,
even if it comes down to reputational damage only
Financial regulators mirror these systems: domestic rather than legal or financial consequences, further
payment methods and providers are built to satisfy intensify scrutiny. This is because even legally viable
the local regulator and customer behavior but might activities can intersect with restricted counterparties
fail when global transactions take place. Once the same through correspondent routes, pressuring providers
infrastructure has to handle multi-currency flows, to prioritize their own regulatory protection over
various fraud settings, or reporting according to local data merchant convenience.
requirements, the problems start to appear.
• Several countries now require transaction data to be
Of course, these issues are never communicated up front, stored locally or to be reported in a specific format to
so merchants can easily find themselves in a situation domestic authorities. When an international merchant
where they need to firefight problems they have never uses a foreign gateway that does not comply with
before needed to anticipate, plus they are the ones facing local storage or reporting rules, the responsibility
lost revenue. does not disappear: it falls on the merchant. Since
this type of situation is not usually strategized for,
Moreover, many of the providers and banks build their the solution is adding various tools at the last minute
risk portfolios individually, which means that they all in a panic to comply. This is not only significantly
evaluate dispute ratios, business activities and the risk more expensive but also opens its own Pandora's box
for wrongdoing subjectively; therefore, a setup that might of problems later.
have appeared low risk in one country can move into a • The most common issue of all is seeing a holding
higher monitoring category once additional regions enter structure that was originally designed for tax
the flow, even if the product or service itself remains optimization. Unfortunately, tax advisers do not
identical. understand how banks think and are therefore
unable to anticipate that banking risk appetite is
This transition frequently results in increased rolling completely different from legality: a setup perfectly
reserves, higher merchant discount rates, complications justified by various legal opinions does not mean
around onboarding or even straight blocked or frozen banks or payment providers are happy to serve such
accounts, which all place operational pressure on a setup. And if they do – it will be very expensive.
businesses that have never seen this coming.
Banks and financial institutions evaluate not
Predictable patterns across markets only the product or service offered but also the
ownership chain, director profiles, source of funds
Several patterns repeat when it comes to payments and documentation and the jurisdictions involved.
banking; however, not many realize them from the
beginning. These are only a few examples to consider, but setting up
• Checkout friction as well as disputes increase when an overall payment and banking strategy that considers
pricing remains anchored in a foreign currency but is all areas is extremely complicated and, with the classic
paid in another, simply because the customer is facing business departmental setup, cannot be handled
different pricing than expected only at the payment efficiently.
page. When preferred local methods such as UPI
in India, Pix in Brazil, or iDEAL in the Netherlands
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