Foreign exchange fees, chargeback fees, processor fees… there are a lot of direct costs when it comes to accepting payments online.
These costs can understandably set off alarm bells for CFOs, especially in a tough economic environment, but Pierre-Edouard Jumel, CFO of the unified payment infrastructure provider Primer, says this is shortsighted.
“I get it. I used to think about payments the same way. I saw them as a complex, opaque process at the end of the customer journey. They were a significant expense, eating into our margins,” he says. “The burning question on my mind was always, 'How can we cut the cost of accepting payments?'”
But Jumel argues that this is not how businesses — especially high-growth startups — should think about payments. Instead he urges finance leaders to think: how can we use payments to drive value creation?
Here’s how startups can turn payments into profits.
Reduce friction, increase revenue
Payments play a huge role in growth companies that want to disrupt a sector.
Think of some of the biggest startup success stories of our time, such as Uber and Airbnb. You may not categorise them as payments companies, but they are all partly founded on the ability to pay for a service in a more seamless way, whether that’s replacing the use of cash in a taxi or an alternative to leaving your credit card at a hotel check in desk.
By delivering a streamlined checkout experience and optimising payment processes, these companies show how reducing customer friction can drive success. If startups do the same and also focus on seamless payments, Jumel says that they can boost their conversion rates, ultimately improving commercial performance.
As we looked to scale our payment infrastructure, it became a challenge for our lean team to build and maintain connections with different acquirers and payment methods.
Ferryhopper is a European ferry booking platform headquartered in Greece which is trying to transform the global ferry industry — with more than 4bn passengers using ferries for work and leisure, the sector is yet to see much innovation when it comes to booking tickets. After being set up in 2017, and after years of success using an embedded payment form in Greece, Ferryhopper wanted to go global — but to do that its payments stack needed to be global too.
"The solution worked great for several years," says Panagiotis Sarafis, CPO and cofounder of Ferryhopper. "However, as we looked to scale our payment infrastructure, it became a challenge for our lean team to build and maintain connections with different acquirers and payment methods.”
As a result, Ferryhopper partnered with Primer. It now uses Primer’s Unified Payments Infrastructure to manage payments across 12 countries. The startup also now offers different payment options including Apple Pay, Google Pay and PayPal.
You need to be able to provide the right payment options for the right geographies and the right segment of end customer.
Jumel emphasises the importance of tailoring payment methods to different geographies and customer types to prevent them from abandoning your business for a competitor.
“Ambitious startups tend to think globally from day one,” he says. “You need to be able to provide the right payment options for the right geographies and the right segment of end customer, so offering multiple payment options isn’t just convenient, it’s a powerful growth accelerator.”
Jumel adds that an early-stage startup should fundamentally accomplish two things: Offer a product or service that meets customer needs and have a payment strategy that meets customer expectations.
Partnership potential
But even with all of these benefits, accepting payments as a startup can be daunting and distracting. Companies that take the plunge and build their own payment infrastructure in-house face complexity and cost — and the indirect costs can be easy to overlook.
Primer has allowed us to consolidate our payments stack, removing operational challenges and ensuring we can scale at pace.
“If you try to build in-house, your payment infrastructure is just increasing the risk of complexity and deviating your focus from your core competencies,” says Jumel. “When you have so many different departments involved in the payment journey, you have indirect costs in terms of resources, but also infrastructure and hosting costs (the likes of AWS, Microsoft, Azure or Google Cloud).”
That’s where a payment infrastructure partner such as Primer can really make a difference. The company allows businesses to connect their preferred services in order to accept, optimise and manage payments — lowering the total cost of ownership tied to the direct and indirect costs of processing payments.
"Primer has allowed us to consolidate our payments stack, removing operational challenges and ensuring we can scale at pace," says Konstantinos Kontos, product owner, payments, at Primer. "But we're just scratching the surface.”
With Primer Observability — a payment analytics tool providing merchants with real-time insights into performance across all payment services — Kontos says Ferryhopper tracks its key KPIs in a 360-degree view, as well as constantly exploring new ways to deliver for its customers.
“We have more data than ever to better understand our customers and payment flows," he says. "It allows us to delve into the minutiae, using metadata and crafting customised charts to decode our customers' behaviour."
Jumel agrees, adding that while payments are often seen as a cost centre — a department or function that incurs expenses without directly contributing to profit — this is not true. Payments are a strategic asset, capable of driving both revenue growth and cost efficiency while empowering your business to achieve its core objectives.
“Optimising payments goes beyond cost reduction — it’s about driving growth and efficiency,” says Jumel. “By refining payment strategies to reduce friction and tailor methods to customer needs, businesses can unlock higher conversion rates, improve operational efficiency and scale sustainably in line with their ambitions.”
