The Problem We Were Actually Solving
From our initial research, it was clear that fiat currencies still dominated cross-border transfers. Payment platforms like PayPal and TransferWise had made it relatively easy for individuals and businesses to send and receive money across borders. Cryptocurrency, on the other hand, was often touted as a solution for the unbanked and underbanked. However, we quickly realized that cryptocurrency transactions were not as frictionless as we thought. We needed to assess the trade-offs between these two options for our digital creators.
What We Tried First (And Why It Failed)
We started by exploring the cryptocurrency option. We built a simple wallet integration using the popular Ethereum blockchain. We thought it would be a straightforward process, but things quickly got complicated. The fees for transferring Ethereum were steep, often exceeding 10% of the transaction amount. The volatility of cryptocurrency prices also meant that creators might receive pennies on the dollar for their work. We also encountered issues with Know Your Customer (KYC) and Anti-Money Laundering (AML) regulations, which added complexity to our development process. It seemed that cryptocurrency wasn't the silver bullet we thought it was.
The Architecture Decision
We decided to pivot to PayPal as our payment partner. This decision was not taken lightly, given the existing stigma around fiat currencies in some developing countries. However, we realized that PayPal's user base and payment network were far more extensive than any cryptocurrency. We also appreciated the fact that PayPal's fees were more transparent and lower than those of most cryptocurrencies. In addition, PayPal's compliance with KYC and AML regulations meant we avoided the added complexity and costs associated with cryptocurrency. Our architecture now consisted of a seamless integration with PayPal's API, allowing creators to receive payments with ease.
What The Numbers Said After
After integrating PayPal, our metrics revealed a significant reduction in payment failures and disputes. Our creator satisfaction ratings skyrocketed, with many praising the ease of use and reliability of the platform. In terms of fees, we found that PayPal's rates were lower than those of the cryptocurrency transactions we had initially tested. The data also showed that our digital creators were more likely to receive the full amount they were owed, thanks to PayPal's more stable pricing.
What I Would Do Differently
If I had to do this project again, I would focus even more on the nuances of global payment systems. I would engage with more digital creators from developing countries to understand their specific pain points and preferences. I would also explore alternative payment options, such as mobile wallets and local currency transfers, to create a more inclusive and diverse payment ecosystem.
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