Interview: Our CEO on payments in a post COVID-19 world
Aug 03, 2020
Philip McHugh was interviewed by P20 for its latest report: Payments in a Post-COVID-19 World. He discusses how Paysafe is operating during this ‘new normal’, and the future of the payments industry.
How is Paysafe maintaining smooth operations during the COVID-19 pandemic?
Like many digital companies, the strength of our internal technology was a revelation. All our 3,400 team members have been successfully working remotely using Microsoft Teams, and productivity has actually improved in many areas. We do have people for whom working from home is more challenging, but in our latest internal wellbeing survey, 93% of our team members were happy working at home and wanted that option retained in some form going forward.
We’re past the first chapter of remote working due to COVID-19 - now it’s almost business as usual, just in a pandemic context. Keeping our people safe and happy is fundamental to maintaining smooth operations, so we’re tracking mental health and having lots of conversations about wellbeing in general. It’s something we’re very focused on because human interaction is definitely an issue, and it impacts different teams differently. Our sales and business development teams are probably feeling it more, because their roles were primarily about external engagement and meeting people. Now, of course, it’s much more digital. Our developer community has certainly been impacted, but a large proportion of them worked remotely before COVID-19 so are used to this style of collaboration.
What do you consider the best practices for payments companies during a time of pandemic?
The top priority should be getting the balance right between ensuring that your team are staying safe and healthy and staying focused on the business. The way that you achieve that is listening to and communicating with them. We’ve been communicating extremely transparently at all levels, so that all team members know we’re doing the right things to take care of them and making the right decisions to safeguard the business, so it can grow and succeed after the pandemic has passed. Once that balance has been achieved, then companies should be recognizing and actually getting excited about the fact that they can operate and succeed in this environment.
Industry collaboration is also important. Even prior to the pandemic, payments was an industry where no one could do it alone. There are large players, new players, regulators, banks and pure fintechs, and some of us are good at certain parts; some of us at others. The fact is, you need coordination. That’s why P20 is so important, because it drives coordination in a unique way due to its global focus, senior board, and mixed membership of banks, fintechs and regulators. In a world with COVID-19, that level of coordination is going to increase. Companies will need to depend on one another, collaborate, and work closely with regulators.
There is also the question of how governments will react to the massive debts and job losses. There’s going to be a lot of change, and payments will be impacted. As such, having a strong association that fosters transparent language, good debates and transatlantic topics has only increased in importance since COVID-19.
What principles should payments companies be adhering to? What hurdles should they avoid?
Payments companies need to support and listen to their teams through this next stage of the pandemic, but they should be injecting normalcy too. We’re still ensuring that our corporate goals are clear and that our team’s focus is on the right areas, and we’re still commemorating things like Paysafe Day, our annual celebration of culture, reward and recognition at Paysafe. In addition, you need to make sure people are taking the time they need for mental and physical wellbeing, and crucially, that people are still taking proper time off. It can be tough when working remotely to draw a hard line between work and home, so you have to create that line, lead by example, and encourage people to step away from their desks.
How do you think COVID-19 will change the future of payments?
There’s a lot of talk about COVID-19 creating a true global reset of the economy and the payments sector. I think this is only partially true, because the core trends impacting payments have not changed, just accelerated. The move from instore to e-commerce, to omnichannel, to having robust, global technology platforms – these were already trends. The difference is that they are no longer ‘nice-to-haves’; they’re a must for every merchant we deal with. The changes we have to make are the same, we just have to move faster. I think how we work and interact with each other will change more permanently. We will still have office space, but can we reduce our office footprint by 30-50%? How do we redesign the offices? Can we start hiring outside our existing geographical footprint? I don’t think we’ll ever go back to what was normal.
What are the key opportunities and challenges that the payments industry faces as a result of these changes?
Like everyone else we’re seeing huge swings. Card present transactions dropped dramatically and are only now starting to recover, and online and digital payments have taken off. About 65% of Paysafe’s revenues are ecommerce based, so we’re well positioned to ride an accelerated wave towards more digital and omnichannel payments compared to other players in the market. So that’s an opportunity.
In some recent international research we did among 8,000 consumers, 42% said they’re shopping online more following the COVID outbreak. This figure grew to 54% in the US. 56% said they’d tried a new digital payment type. That appetite is a threat to traditional payments, but a real opportunity for companies that can deploy multiple payment types and support digital companies. We think that’s very exciting for the industry as it will create more competition and more choice for consumers.
Furthermore, our e-cash business, where you use cash to buy digital products, is actually growing over 20% right now. Some people aren’t comfortable using certain payment types – they prefer cash, but are having to transact in a digital world, so having a solution that can bridge that has real appeal. That’s a huge opportunity for us.
P20: Payments in a Post-COVID-19 World can be read in full here.