WebBilling Charges Future

John Stuart
The U.S. dollar is being drubbed by the euro at historic levels. At this writing, the euro is a robust plus-46 percent premium against the American greenback, and people who follow the money markets say things will stay this way for a long time. While this may cause consternation in some domestic offices, there are nothing but smiles in the offices of the Amsterdam-based payment processor, WebBilling.

Celebrating its 10th year of service, WebBilling has established itself as one of the primary payment processors in the European Union, serving Spain, Austria, Germany and The Netherlands. The firm achieved this by going along with the European reluctance to opt for credit card billing. Instead, WebBilling has committed exclusively to direct debit payment formats.

"Payments are pulled directly from the user's bank account," explains Joe D, chief marketing officer for WebBilling. "The user enters an account number, routing number, and their relevant information in the join page and the money is actually taken from their bank account. The advantage to the user is that it's not an alternative payment method. It's a preferred primary method. And the advantage to the sponsor program that wants to entice a person to join is that it's a more direct method of payment.

"The way we've structured it offers a lot of benefits that are associated with credit cards in the U.S. market, in that you have recurring billing, instant access, up sells, pay-per-anything, pin call security, free trials, and cross sales.

"The advantage to our company in never dealing with credit cards is that we're not limited by the Visa rules, including the one percent chargeback rule. It gives us more flexibility."

The success of direct debit billing in Europe as opposed to the U.S. has to do with cultural differences, according to Joe. Europeans simply are accustomed to paying most of their bills either with cash, which is common in store transactions, or with their bank accounts. European telephone companies withdraw money directly from customer savings accounts, as do power companies and landlords. Also, many salaries are paid via direct deposit. No types of cards or other vehicles are involved.

"This is especially true in Germany, which is a paperless society," Joe says. "People are used to this payment method, so they don't write checks anymore, and they would be less likely to enter credit card information. In North America, people freely enter their credit card information, but try to prevent anyone from finding out about their personal banking."

Customers concerned about keeping their purchases discreet have just as much protection under this direct debit system as with any other system now in use on the Internet. The charge on their bank records appears as And for sponsors, there is also a field where they can identify themselves discreetly if the customer wishes.

One of the most sponsor-friendly aspects of WebBilling is its adult-friendly collections department, which goes into action the day after a chargeback occurs by sending a letter to the buyer.

"The triggers are automatic," Joe explains, "and we're involved with legal offices in Europe, which follow up after we send out the letter to the delinquent consumer. We're quite successful in recovering chargebacks, plus the fees for the sponsors."

Unlike credit card billing, the primary reason for a chargeback in direct debit has to do with insufficient funds in a customer's account. More often than not, this situation rectifies itself in a day or two with fresh deposits. But for the chronic abusers of the system, WebBilling has an ace up its sleeve.

"We operate with a 10-year negative database," Joe reveals. "After working in so many countries for so many years, we've built a negative database of known fraud offenders, which prevents a lot of chargebacks. It allows us to identify people who have pulled things in the past. We don't have to deal in credit card fraud, but Europe is different in terms of 'friendly fraud.' It usually boils down to people claiming they didn't buy, so it's not any organized criminal level thing."

Billing exclusively in euros, WebBilling has taken pains to stay ahead of the technical curve by improving its application programming interfaces (APIs) recently.

"APIs basically speak to the technical staff," Joe adds. "It's the actual structure and code that needs to be embedded in their programs, so that they can access our processing platform. We have two APIs. Sponsors can either implement us using the WebBilling join page, or they can host their own join page. Our new feature, Tiger API, is for merchants who want to host their own join page. Some merchants like to exercise that amount of control. We started Tiger API in 2007."

Aside from its offices sprinkled throughout Europe, WebBilling maintains a sales and service office in Fort Lauderdale, Fla., where it hopes to lure U.S.-based sponsors to take advantage of the burgeoning European market.

"It's a good time for the U.S. programs to get into the market in Europe, because broadband access is increasing," Joe says. "The population of Europe as a whole is actually greater than the U.S. It's becoming a bigger, better market. And our company can help with the transition.

"Once the sponsor has our billing in the various European countries, they can look at the regional search engines, and optimize themselves in different languages. They can get into it as much as they want. We provide translations for all the join pages, but if a sponsor wants to translate their sites and go after these individual markets, they only have to make the investment in time and personnel.

"Any sponsor that has experienced significant growth over the years has to be looking at global expansion to maintain that growth. If a sponsor has reached a plateau, they really need to consider Europe, Asia, and mobile technology in order to keep growing."

For those American companies that decide to take the plunge into the European market, one of the prime concerns is choosing a payment processor that has a strong relationship with the banks in the various countries.

Each European country has its own banking system, and WebBilling has cultivated "quite strong" relationships with all of them over the last decade, according to Joe. Plus, the very longevity of the firm's operation is a powerful draw for sponsors.

"Our edge is in our longevity, and our E.U. expertise," Joe adds.

WebBilling figures to expand its base of operations in Europe during the coming year. It may soon add Belgium to its roster of nations, pending banking system approvals. Those approvals have already arrived from the U.K., and final technical refinements are all that remain before WebBilling begins to do business there, as well.

Joe believes that the company's track record of earning money for its clients is the key to its continued success and growth.

"We work with our clients in an ongoing basis, developing strategies that will continue to increase their earnings," he says. "We help them to understand the E.U. markets, country by country. We look at their sales, and the makeup of their sales. It's not unusual for a European-sponsored program to find that 80 percent of their revenue can be from direct debit, 15 percent from credit cards, and the remaining five percent from SMS phone billing and other means.

"We work from our customers' feedback, which often calls for tweaking their join pages, and making sure the language is correct to optimize conversion."

Although Joe may sound like a grizzled veteran of the payment processing game, he only joined WebBilling last November. Prior to that, his expertise was closer to the pen than to the calculator.

"I produced Klixxx Magazine for six and a half years," he says. "It was time for a change."

Joe, however, has not left the publishing business completely. He gets out his writing ya-ya's through the XBIZ blog, "B2B With Joe D."

"I missed it, so I enjoy the opportunity to get back into writing again," he explains. "But I'm happy I made the move to WebBilling. I really believe in this product, and the timeliness of it."