An Exclusive ECJ Interview with Martin Ott, the CEO for Moneybookers.com

  Marianna:First of all, I would like to thank you for allowing us to ask some questions about your   company. Tell us a little bit about yourself and your position within Moneybookers.

  Martin: Before joining Moneybookers, I was COO of Jamba/ Jamster (a News Corp/ VeriSign   company and leader in mobile content). In this role I helped develop and led the worldwide   operations in almost 40 countries as well as the marketing, production, content and licensing   divisions. I have received my master in Business administration at the WHU - Beisheim School of   Management in Koblenz, Germany, as well as in Tokyo and Moscow. Before my position at Jamba,   I founded and ran Tokyo based web portal Eken K.K..

At Moneybookers, which I joined at the end of last year, I am responsible for e-commerce sales, P2P money transfer, marketing, as well as the product and the service operations. My Co-CEO Dr. Nikolai Riesenkampff, who has been managing the company successfully since May 2005, is responsible for our departments in the field of Finance, IT, Legal, Compliance, Risk and International Business Development. My personal goal is to accelerate our growth in the P2P and e-commerce business, making the payment systems even more secure and more easy to use for Moneybookers customers as well as driving innovation to make Moneybookers the leading provider for internet transactions worldwide. 

M: According to the front webpage Moneybookers has over 4.4 million account holders and over 6 billion processed transactions. Already handling a tremendous business of such scale is Moneybookers still "in adolescence" and continues to grow or is it maturing by settling into a significant share of the market?  

Martin: Moneybookers has been founded in 2001, as the first European e-Money issuer. As such we are not in Start-Up phase anymore with very mature processes and systems. As a result we are now one of Europe's largest online payment systems with almost 5 millions customers.  However, today the number is growing faster than ever. Every day Moneybookers welcomes more than 8,000 customers as new owners of its electronic wallet. So Moneybookers is one of the fastest growing payment solutions worldwide - with revenues and profits more than doubling in 2007. So with a booming e-commerce market and the need for secure and convenient payment systems, we are on the right way to see an even more record numbers in the future...and thus no time to settle down.

M: One of the distinctive services that the company offers is Mass Payments with its benefits listed as paying affiliate commissions, customer bonuses or payroll. How popular is this service among business customers?

Martin: The service is very popular among affiliate partners. However, we are also seeing a very large increase in the number of social networks using our services. In the past these companies have solely relied on selling advertising. Today they are looking for new business models. Micropayments for donations, gifting or other virtual goods are one area of growth. However, more and more companies - particularly when working with User Generated Content - are using our system to pay their customers back, triggering thousands of instant micropayments to incentivize their customers or simply pay them back for their contribution. Other companies use our systems to run loyalty programs and CRM campaigns such as Cash Backs, Discounts and others.

M: The opportunity to send/receive faxes, sms and make mobile payments might be of not the primary importance but stands out as a smart addition to your clients' money management methods.  How common is the use of these services and do you attribute attracting more business to having these options?

Martin: The possibility to send and receive money in real time and extremely low priced via e-mail is an important reason for more and more clients to use Moneybookers as their main money transfer service. For example, about half of almost 5 million account holders use the payment service for making transactions to their country of origin. Furthermore 30 percent of the clients use the money transfer service for small amounts in rates from up to 30 pounds.

M: Talking about e-wallets, I noticed that the USA and India are the only two countries listed on you website which do not have any available deposit options for account funding. How do clients from these countries finance their accounts? Is receiving payments from other parties the only account funding option?   

Martin: At the moment we do not offer local deposit options in these countries to fund their accounts. However, we are looking into offering this service in the future in these and many more countries as well.

M: How many merchants are listed with your company now? Why does Moneybookers exclude some industries from becoming accepted merchants?

Martin: The merchant acceptance is really fast-paced. Meanwhile almost 10,000 merchants use Moneybookers‘ gateway product. Our payment solution opens new markets for e-tailers and increases their conversion rate up to 80 percent.

M: In transferring payments between customers and merchants, how do you protect the transaction in cases when goods or services are not delivered to the customer at all or in the shape desired?

Martin: The business relationship is conducted between the merchant and the customers. We focus only on processing the payment between both parties and have therefore no influence on the service itself. In order to protect the customer we offer an escrow service where the funds are only released once a customer has received the goods and is satisfied.

M: Tell us a little about your Referral Program and how successful it is. Who are the majority of referrers: businesses advertising Moneybookers on their websites or individuals hopeful to make some extra cash?

Martin: The referral program is designed for our end customers. We encourage our users to share their moneybookers experience with their friends and family. Social networks expect you to do this for free. However, we believe that our members should also participate in our success.

M: One of the most sought out features customers look for in an electronic payment system is anonymity. How anonymous are Moneybookers' transactions?

Martin: The great advantage of using moneybookers is that the customer does not need to reveal their private address or financial details on any site. They simply pay by using their email address and their passwords and are thus protected and completely anonymous.

M: With online ID and account fraud blossoming, how do you protect a company of such scale? How often do customers' accounts become targets of fraud? Do you have any interesting statistics on that?

Martin: Moneybookers' solutions are developed with the same demands on security and performance as websites used for bank services and stock trading. As customers no longer need to give personal information to lots of different online websites we help them to pay in the most reliable, secure and convenient way. Unfortunately we do not have statistics how often customers become targets of fraud on other sites.

M: Recently our journal has collected a tremendous number of online payment systems in one catalogue and the list is still growing. With so many players on the market, what do you consider your major competitive advantage? Who are your biggest competitors?

Martin: The international payment landscape is highly fragmented due to a great range of domestic payment options other than credit cards. Offering over 50 domestic payment options in over 35 countries out of one hand with one single integration is what sets Moneybookers apart from the competition. We are also managing the complete risk process up to the point where for certain merchants we can take on the complete chargeback risk. With nearly 5 million existing customers with customer service in 12 different languages we offer superior service to our end customers and our merchants.

As for the competition it is mainly Paypal that we are competing against in Europe. What makes us different is the many more local options than anybody else in the industry. Also we are an independent company and truly the best competitive offer in the market. This is reflected in our tremendous growth and success with the merchants.

M: Talking about payment systems and money transfers it is hard to avoid ‘the USA question'. The United States of America are creating a lot of tension by tightening and, in some way, creating new regulations in relations to digital currencies and online payment systems. What do you think of the US laws which slowly force the US citizens from the electronic payments and digital finance?

Martin: As we are focusing on Europe and not targeting US consumers I could not comment on the market conditions over there. Here in the EU, a Single euro Payments Area - called SEPA - is being developed that will create a more competitive and transparent payment landscape throughout the region. We welcome this initiative as it sets an open and common standard across the EU for payments services from which most importantly the consumers will benefit greatly.

M: In conclusion, first and foremost, all of us at ECJ would like to thank you for this interview and wish your company success and continuous growth.  Please tell us a little about your future plans and on-going projects if any. Are there any particular markets you are focusing on now? What other markets would you like to enter? Are you planning to introduce any new services?

Martin: We are currently launching an application for facebook. With the Moneybookers integration on Facebook profiles, our customers can now collect money their friends owe them or launch a fundraising appeal with minimal hassle and without having to pay out exorbitant fees to third parties. In the next years we are planning to expand more internationally to Asia, Latin America and into Africa. We also believe that there is a great need for a low priced mobile payment service across all markets and you will see more about that soon.