Marketplace Payments Automation

What is an Online Marketplace?

Online marketplaces must pay their digital partners – often thousands at a time – with efficiency and by mitigating risk, reducing compliance burdens, and maintaining profitability. Only then can they scale their growth. And growth is the only path for a marketplace to succeed. It’s very nature requires scale.

An automated payment operation goes beyond sending wire transfers and making PayPal payments. How does automating payments drive the business forward?

  • Global Positioning – A robust payments competency expedite marketplace growth to take advantage of global partners.
  • Platform Agility – Operational scalability and efficiency reduce friction across the board, but particularly with partner relations.
  • Strategic Insight – Real-time payment reporting provides the intelligence needed to drive financial decisions.
  • Operational Focus – Strategically and analytically focused finance personnel can step away from transactional activities to more business-critical analysis.

Does our marketplace have a payments issue?

Here are some common issues online marketplace face regarding payments process to their partners.

Operational challenges 

  • Time spent onboarding or emailing an ever-changing partner population.
  • Siphoning resources to populate partner bank account data.
  • Complying with IRS FATCA and international tax compliance requirements.
  • Investigating and resolving payment errors and issues.

Global partner challenges 

  • Validating that partners are legally payable.
  • Paying in preferred methods and local currency.
  • Adhering to local banking and regulatory issues.

Management challenges 

  • Reporting on payments across multiple accounts takes hours or days.
  • Kludgy in-house systems built from proprietary code must be maintained like an off-the-shelf product.
  • Hiring additional staff to meet payment needs of growing marketplace.
  • Mitigating fraud risk.

Marketplace Payments Automation Checklist

Looking to automate online marketplace payments? Here’s what every system should have in place to ensure a future-proofed, scalable process.

For more insight, including real-world perspectives from senior finance and operations teams at online marketplaces, download our ebook.