Ukash provides its online payments services in 55 countries with more than 420,000 locations worldwide. But it has so far steered clear of the U.S.

The biggest barrier to entry in the U.S. is the splintered state-by-state regulatory environment, says David Hunter, CEO of Ukash. But each country has its own challenges, and any payments company looking to expand must consider geopolitical stability, Internet and mobile penetration, retailer distribution, competition and culture, among other factors.

"There's an art to this," he says. "Sometimes the problem we thought we'd solve isn't a problem in another country."

And in that case a company should see when something isn't working and know when to pull out, Hunter says. Ukash left China because of the country's vast, complicated regulatory environment, he adds.

Even MasterCard, which is based in the U.S., chose to debut one of its most prominent new products overseas. MasterCard launched its MasterPass digital wallet in Australia this year and also put Canada and the U.K. ahead of the U.S. 

Hunter and others shared their experiences with international expansion during a panel discussion at Money2020 this week in Las Vegas.

Forming relationships with local regulators is one way to make sure an expanding company isn't breaking any rules as it enters a new region, says Tom Pareigat, senior vice president and general counsel at The Bancorp Inc.

A company also must put thought into the partnerships it plans on making in another country, making sure the new partner doesn't hurt relations with an existing ally, says David Cebollero, vice president and senior counsel at Western Union.

And Europe is a fertile continent for payments initiatives, Hunter says. "Europe is crying out for some of the successful prepaid products [seen in the U.S.]"

Europe also makes it easy to expand by allowing money transfer companies to become licensed in one country and then expand into another country with existing regulations and supervision. 

The one key lesson Ukash has learned since its 2005 launch: keep things simple.

"The simplicity of [our] product is one of the reasons we've been able to expand so quickly," Hunter says.

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