Speaking to TechGraph, Yash Srivastava, Managing Director, APAC, Coda Payments said, “Advanced AI-based ecosystems can help build a foolproof system to prevent cross-border money laundering.”
Read the complete interview:
TechGraph: How Coda Payments is utilizing its sectoral expertise and digitalization to solve the unsolved payment gap in the online content and gaming industry?
Yash Srivastava: The biggest problem that the content arm of the app business was confronted with was monetization through micro-transactions.
This was primarily because, in the days before payment wallets became a pervasive presence on the internet, making purchases worth Rs 20 or thereabouts – 75 cents to USD 2 – was incredibly difficult since the minimum cap on transactions through credit cards was considerably higher, owing to fixed fees on the cards. But for publishers, micro-transactions are vital to revenue generation, and this was the problem Coda solved, to the satisfaction of all parties concerned.
On Coda Shop, gamers can top up for extremely small amounts, while publishers don’t have to worry about monetizing through micro-transactions. This was made possible by allowing gamers and mobile users to transact through digital wallets, or instant bank transfers, among other payment options. This helped publishers unlock content across markets.
TechGraph: What is the state of cross-border monetization platforms in the MENA & Asian markets?
Yash Srivastava: Our operations span more than 60 countries, and we work with global and local publishers. Publishers partnering with Coda can avail of a wide range of services to enable a conducive operating environment in a foreign country.
This includes assistance with tax compliance, partnership with local payment gateways, and creating channels for money movement across international borders. Coda conceived its operational model in Southeast Asia – Indonesia, Thailand, Philippines, et al – and that region remains among our most profitable to date. Right from the outset, and regardless of which country we were operating in, we were mindful of the need to partner with only those operators registered with the government.
This is true even in India, where we are partnered with payment gateways and other financial operators, all impaneled by the Reserve Bank of India. Over the past few years, we have ventured into Africa, the Middle East, and even Europe and the Americas. In a year, we processed almost USD 1 billion in more than 60 currency pairs. Thus far, we have provided a safe and secure channel for money movement across borders.
TechGraph: How is Coda Payments facilitating publishers’ payment processes?
Yash Srivastava: Firstly, the adoption of alternative payment systems such as digital wallets or instant bank transfers has proved to be very cost-effective for publishers. Additionally, they also realized that offering a diverse payment suite to gamers would open up new markets. Publishers were finding it difficult to sustain profitability since legacy app stores took a significant share of revenue generated on their platform – anywhere between 15 and 30%.
Coda, on the other hand, only charges a small percentage of the transactions carried out on our platform. Publishers were quick to see the advantage of partnering with us; furthermore, alternative payment services attracted new customers, which increased monetization opportunities for publishers. Also, publishers keen on taking their games to, say, 60 or 80 countries, can do so by partnering with Coda. This is also beneficial to us. That is one of the reasons we focus on entertainment gaming.
As mentioned in the answer to a previous question, our gamut of services includes assistance in local markets. A publisher partnering with Coda offers to link the API with ours. Once that is accomplished, we are entrusted with processing transactions in 60 currency pairs. Solutions to such niche problems and assistance in navigating different economic markets greatly drive publisher monetization.
TechGraph: How do you see technologies namely AI and cloud technology relevant across cross-border monetization platforms and in payment gateways? What does the future look like?
Yash Srivastava: The game-changing abilities of Artificial Intelligence (AI) do not have to be reinforced because it has become so integral to most businesses that rely on data today. Many financial institutions have already started leveraging AI to combat fraud. It is only a matter of time before gaming publishers integrate these methods into their respective platforms to combat fraud.
Furthermore, advanced AI-powered algorithms can help build a foolproof system to prevent cross-border money laundering. Cloud-based technology, on the other hand, promises to render the whole of the gaming ecosystem secure. While rendering illegal game downloads impossible, decentralized storage of gamers’ financial data will add a further layer to publishers’ firewall mechanisms.
TechGraph: How do you prepare for highly disruptive spaces?
Yash Srivastava: There are already several fintech companies operating today that use data analytical tools to incorporate AI-powered mechanisms into their existing models.
As a provider of payment solutions, Coda needs to stay updated on developments in this space, along with how we can improve security on our platforms. We are constantly working on developing an in-house anti-fraud mechanism, but the methods employed by miscreants are also constantly evolving. We have adopted measures to check cybercrime, including preventing multiple transactions by the same user. We have also capped the number of purchases for a month or a week.
TechGraph: Going forward, what will be Coda Payments’ major focus areas? What are your expansion plans?
Yash Srivastava: For Coda Payments, 2016 was the watershed year – this was when we put into action our plan to drive monetization in the APAC region, by focusing on the gaming community. When it comes to in-app monetization, the two domains that generate revenue are gaming and dating, and we channeled our energies toward the former.
Publishers based out of Korea, China, and neighboring countries were unable to reach a readily available pool of customers in APAC because of poor credit card penetration in that region.
We filled this gap in those countries. What that experience taught us was that each market or country had a specific requirement. Our success depends on us recognizing that, and offering our services. After Southeast Asia, we expanded our operations to South Asia, the Middle East, Africa, and developed markets such as Europe and the Americas.
The portfolio of services we offer in each market is different – while we provide alternative payment services in developing countries, we solve niche problems in developed markets, such as gifting options, and other such small areas. We know we have to tailor our solutions to meet market demands. At the same time, we remain very optimistic about the future of India.