During its six season working history, the organization has changed in many ways to meet modifying market demands. Payoneer applied a solid difference strategy by using pre-paid an atm cards to accomplish the movement of funds across national boundaries. Further difference was accomplished by focusing on market sectors struggling with these types of expenses. And although there is competition, Tal indicates that, "the real difficulties are not aggressive, but are things like fighting scams and mitigating other risks."
Prepaid an atm cards are everywhere. A survey published by the Federal Source Bank of Birkenstock boston in 2009 revealed that approximately thirty three percent of all customers owned and operated some type of pre-paid bank cards. Prepaid an atm cards include a diverse number of payment equipment ranging from gift certificates to pre-paid phone credit cards to electronic benefits transfer (EBT) cards, etc. A very high number of these popular equipment are those released through the major bank cards brands: Visa®, MasterCard®, American Express® and Discover®. Use of these labeled credit cards has been growing easily, and because of recent regulation, they are positioned to grow further and at better pay.
According to the Mercator Advisory Team, customers loaded over $60 billion dollars dollars onto labeled pre-paid an atm cards in 2008, almost a 50% improve over the past season. These credit cards, although carrying these manufacturers, are actually from hundreds of financial institutions and their independent third celebration partners. Payoneer is one of these third celebration organizations.
Yuval Tal capitalized on the increasing trend towards globalized freelancing in the IT market. In particular, he saw that many organizations were freelancing small jobs to freelance employees and micro-companies. Mr. Tal also noticed that these freelance employees found it difficult to get compensated. Sending checks, for instance, took a while -- and an even extended period to clear. Money was out of the question, and wire exchanges were excessively expensive. Tal designed a program to serve this marketplace and "payout processing" was born. Workers could now be compensated easily, and get compensated in their local forex through ATMs. Freelance employment organizations like oDesk, Elance and expert now use Payoneer pre-paid credit cards to pay their employees globally.
Payoneer capitalized on the power of the cards brands' networks and designed an on the internet program that released pre-paid an atm cards to these employees which they use to get their pay. Freelancers could then use their credit cards to buy goods from millions of suppliers or take out money in their own forex from thousands of ATMs. Best of all, the credit cards could be reloaded on the internet by the freelancers' companies. The ease-of-use, on the internet accessibility and many exclusive functions allowed Payoneer to offer a better service than its competitors. "International expenses are not for the average person," says Tal, "it needs institutional funding and an ongoing effort to manage a lot of moving parts."
With a fairly sophisticated expenses system already built, Payoneer was positioned to deal with some other sectors. Like go-karting hooks, Payoneer began banging down similar marketplaces. It created applications to create up members of huge on the internet online applications. The program was also tailored to create up internet marketers, medical trial patients, direct sellers and specialized pay-roll providers. With each vertical, Tal was careful to build-in extremely exclusive functions to improve defensibility with respect to competitors.
New U.S. government rules cause difficulties to pre-paid bank cards providers. The recently introduced Dodd-Frank Financial Change Law considerably decreases the bank cards fees giving financial institutions can cost suppliers. This law will mean serious fee discount rates, leading to a significant loss of revenue for many bank cards providers. Luckily the law did have some exceptions, including the exemption of pre-paid an atm cards from the require. In other words, financial institutions can continue to cost the "old" higher rates for deal on pre-paid bank credit cards. So, financial institutions and their third celebration providers are struggling to develop new pre-paid bank cards applications to create up for lost earnings. This will mean market growth as well as higher achievement. It's times like this where Payoneer's application of defensible difference may be its key resources.