Vantiv has made a name for itself the past two years in advancing integrated payments at the point of sale, while also welcoming application developers to interact with the company's technology through Vantiv ONE. Its latest move puts its focus on e-commerce.

The Cincinnati-based payment processor and technology provider is partnering with PPRO Group to expand payment acceptance to alternative methods common in Europe. Vantiv and London-based PPRO Group will establish a pipeline to go beyond card payments and accept direct debit, bank transfers, cash-based e-payments and e-wallets.

The partnership will establish a single integration point for merchants to better reach international customers in the same manner as they accept domestic payments.

"Quite frankly, we were a little late to the game for international payments, but one of the benefits of hindsight is we have been able to identify a few operating models with partners that work, and some that don't work," said Neeraj Gupta, leader of product management and responsible for international e-commerce payments at Vantiv.

It is increasingly common for processors seeking an uptick in e-commerce cross-border payment acceptance to limit their options, rather than try to tackle every possible alternative method available.

Many processors and gateway partners in North America will eye bolstering cross-border e-commerce networks in the future, as digital commerce is expected to reach 11% of all retail sales by 2020, according to recent Aite Group research. At the same time, cross-border e-commerce is growing at a fast rate, with an average compound annual growth rate of 18%, Aite says.

Vantiv will launch its alternative payment acceptance, with PPRO working behind the scenes, with acceptance of SEPA direct debit payments in January 2017, and ultimately following that up by adding the iDeal online payment network in the Netherlands and the similar Sofort network in Germany shortly afterward, Gupta added.

Neeraj Gupta, leader of product management and responsible for international e-commerce payments at Vantiv
"One of the benefits of hindsight is we have been able to identify a few operating models with partners that work, and some that don't work," said Neeraj Gupta, leader of product management at Vantiv Vantiv

If all goes well with the addition of European payment methods, Vantiv will target the Asia/Pacific market next. "Obviously, accepting Alipay through our network is at the top of the list in that region," Gupta said.

"In many markets, 'alternative' payments are actually mainstream," said Zil Bareisis, a London-based senior analyst for research firm Celent. The iDeal network in the Netherlands falls into that category as a popular payment option, Bareisis said.

"So, if you are a merchant and want to sell internationally, you need to be able to accept local payment methods that the customers are used to," Bareisis added. "That’s exactly the role that the payment service providers have been playing over the years, enabling acquirers and merchants to accept various local payment methods."

Technology-driven companies like PPRO Group have benefited from the European Commission's Payment Services Directive update, or PSD2, which called for an open-door policy to encourage more fintech innovation from third parties.

"We looked at which providers really had the resources to connect to all of these payment methods on our short list," Gupta said. "That was one of the things really compelling about PPRO for us."

Vantiv ultimately wanted to minimize the contract process with merchants and any potential delays in international payments, and PPRO's ability to help Vantiv in those areas "mattered to us a lot," Gupta added.

Without a channel provider easing international payment acceptance, a merchant likely would have to make arrangements with different processors and gateways to serve various niches in their customer base, Gupta said.

"We look at our international portfolio as two tracks, one being card payments and the other being alternative payment methods," Gupta said. "We have solid solutions with local acquirers, but we want to meet needs on all payment methods."

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