Paris based SlimPay has announced that they have secured €15 million in funding from Prime Ventures, a growth capital firm with offices in the Netherlands and the UK. A provider of payment solutions to online merchant, SlimPay’s expertise is with recurring payments. Using the company’s products, merchants can set up to receive SEPA based direct debit payments for their EU based customers. According to SlimPay, €2.4 billion were processed using their technology during 2014.
For online merchants, the value-add of recurring payments is the ability to convert customers once and continue to receive revenue from them for ongoing sales such as product subscriptions and variable bills like utility charges. Recurring payments is far from being considered a new innovation in the payments sector, with subscription based collections available on credit cards and PayPal for years. Even in the emerging bitcoin sector, recurring payments became available on Coinbase in 2013.
However, not all payment systems are created equal. As such, despite recurring payments available via the credit card networks, in many parts of the world its availability is limited for bank to bank transfers. As a result, most merchants elect to receive recurring payments via credit card based systems which charge higher rates than bank to bank transfers.
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Within the US, ACH based bank to bank transfers have been slowly gaining traction as a payment solution due to the cost advantages for merchants versus typical credit card transactions. As a result, firms such as Knox Payments and ACH Direct have added the ability for recurring payments using the bank to bank infrastructure.
In Europe, bank to bank transfers have grown due to the Single Euro Payments Area (SEPA) initiative that was launched in 2008. The payment system connects EU countries for cross-border payments and has grown to include 35 European countries. Among its advantages is that the network avails for both credit and debit based payments, with lower transfer rates than had been available before the initiative was introduced.
Leveraging the growth of SEPA, SlimPay has gathered demand for its merchant payment processing solutions. Specifically, the firm has gained traction among merchants for their product’s ability to accept recurring payments. With the new funding, SlimPay expressed that they have plans to expand their presence in their home country, France, as well as the rest of Europe.
On this Jérôme Traisnel, CEO and Co-Founder of SlimPay commented that “The Single Euro Payments Area is on track, and it’s presenting a real international trade development opportunity. A French or German merchant can now charge their clients in more than 34 countries. We have ambitions to become the European leader in recurring payments.”