On top of all the reasons corporate payments can be tricky, the rise of Software-as-a-Service has added a new layer of difficulty. SaaS firms need to get paid on a recurring basis, and one FinTech player has stepped in to fill the gap of this kind of payment service.
U.K.-based GoCardless provides businesses with a way to get paid via bank-to-bank online payments and has expanded to France with a growing base of SaaS companies using its solution for recurring and subscription-based payment models.
Reports on Wednesday (April 13) highlighted where GoCardless plans to go following last month’s announcement of a $13 million funding round, led by B2B cloud and SaaS-focused venture capital group Notion Capital.
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“The service allows more confidence between B2B businesses,” said the company’s France country manager, Amaury de Closset, in an interview with French blog Rude Baguette. “It is functional with larger transactions than credit card payments. Also, in contrary to a credit card, an IBAN doesn’t expire so no risk for failed payments.”
The GoCardless executive added that, with fewer players involved in the transaction, the payment becomes less expensive for both ends.
“People can easily manage their subscription with their online banking app since it appears almost instantaneously in bank statements,” de Closset added.
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In addition to servicing SaaS companies that need to get paid on a recurring basis, GoCardless also carved out a customer base among SMEs, providing direct debit services. Reports said the company is eyeing global expansion as it grows but that it doesn’t expect this to occur easily.
“The hard thing with FinTech is that everything takes a lot of time to deploy,” de Closset said. “Each currency has a proper debit model, and each bank agreement is different.”
In its path of global growth, GoCardless said it will look to target larger SaaS companies that also service the B2C market, like music streaming services that collect payment from consumers on a monthly basis.
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