A new payment network for the internet
This post initially went out as a company-wide email on 23rd April 2015. We're publishing it here today to share our vision with the world.
The internet has changed the way we do business. National borders are less of a barrier to expanding globally — Box.com can serve customers in Japan as easily as it does in the US. Crowdfunders like CrowdCube and P2P platforms like Funding Circle are reshaping the way businesses fund themselves.
However, the way we get paid remains the same. Most payments are still handled by card networks designed 70 years ago for paying in shops. Whilst thats okay for a lot of transactions, it doesn’t work at all in many instances.
Cards are simply too expensive for business to business transactions. This leaves the small guys chasing their customer for manual payments via cheque or bank transfer. Sky-high failure rates also make cards poor for subscription services — many businesses lose up to 10% of their customers each month because of this. Finally, sometimes accepting cards isn’t even an option — in Germany, for example, cards are only used for a fifth of payments.
To fix this, we are building a new payment network for the internet.
We’ve started by creating a really simple layer on top of Direct Debit. Whilst Direct Debit isn’t a new system, it is a great mechanism for recurring payments. It’s cheap because there are few intermediaries in each transaction. It’s reliable because payments are taken directly from your bank account.
Before GoCardless, Direct Debit was inaccessible and under-utilised. It was typically only available to the largest companies and it was hard to manage because the underlying processes are clunky and out of date.
Our technology has changed that.
By aggregating volume, we’ve been able to open up access to anyone, regardless of their size. By building simple APIs, we’ve enabled our customers to automate their processes, leaving them to focus on their business instead.
By creating technology to simplify Direct Debit and make it accessible, we have quickly grown into the UK’s leading Direct Debit provider. We now process over half a billion pounds each year for over ten thousand businesses across the UK.
We have also added new geographies, and have the early versions of an internationalised service. This gives us the foundations to create a new payment network for the internet.
We will do this in two steps.
First, we aim for the scale of the internet by creating a global Direct Debit network for recurring payments. We will take our learnings from working with banks, regulators, and systems in the UK & Europe to combine Direct Debit mechanisms from across the world.
Our technology has simplified Direct Debit in the UK by abstracting away the complexities of the system. We will take the same approach to our global expansion — transcending the differences between each country to create a coherent, elegant payment network.
Because of the slow nature of Direct Debit, we will continue to focus on recurring payments. In order to break out of recurring payments, we need to be able to speed things up — no one wants to wait 3-5 days to ship a product. This is our second step. We will do this by working with the existing networks to lobby for infrastructure improvements.
We are already seeing the world move in this direction; Australia is building direct debit into their new real-time payment platform, PSD2 (the new Payment Services Directive) encourages the emergence of new Direct Debit networks built on faster payment infrastructure. When these shifts occur our existing traction will put us in a unique position to take advantage of these developments. It will enable us to break out of recurring payments — creating a new way of getting paid for anything online.
In this world it will be easy for any organisation to get paid from anywhere. Small businesses will be up and running in minutes; large enterprises will enter new countries with ease; and new startups will grow with us. The barriers will be down, and our merchants will be able to stop worrying and focus on what they do best.
The internet has changed the world for the better, but somehow payments got left behind. Let's be the ones to fix it.
If this sounds like something you want to be involved with, we're hiring and we'd love to talk. Head to gocardless.com/jobs to see what's on offer.
More choice of payment dates within Sage
If you’ve set specific payment terms within a Customer Record in Sage, instead of setting the payment to be collected as soon as possible, you can now choose for a customer’s account to be charged in accordance with these terms.
Once you’ve selected ‘Collect Payments’ for an invoice, you are given the option to either collect the amount in full or installments - if the former is chosen, you will now have the ability to arrange for the payment to be charged on ‘settlement date’ or ‘due date’ as well as ‘immediately’.
More control over scheduled payments in Sage
You can now cancel any upcoming/scheduled payments from within the GoCardless add-on in Sage.
You can do this by opening up the GoCardless add-on, selecting ‘Unpaid Invoices’ and double-clicking the invoice you’d like to cancel upcoming payments for. Then simply select ‘Cancel all scheduled payments’ - this will cancel all ‘Scheduled’ payments for that invoice.
GoCardless raises $7m
Today, we're happy to announce that we have raised $7m in Series B funding led by Balderton Capital. Our existing investors Accel Partner and Passion Capital also participated in the round.
We've known the team at Balderton for a few years now, and we've always wanted to work with them more closely. Last year was a big year for us - we are now processing $200m a year, having grown 700% in 2013. We both felt now was the right time to partner up, and take GoCardless through this next stage of development together.
We believe that payments should be one less barrier to business. Direct Debit is perfect for accepting recurring payments, but it’s been out of reach for most companies up until now. For the first time ever, we enable thousands of businesses and charities to access the system. With us, they can grow their businesses faster by improving their cash flow and freeing up time to focus on delivering value to their customers.
Last year, we expanded our team from 10 to 25 people. We will use this funding to recruit more of the best talent to help us improve scale our technology, and expand our service across Europe. Our largest customer today is 15 times bigger than that of a year ago, and we will continue to target ever larger businesses.
Our increasing scale will enable us to improve our service for all of our customers, and we look forward announcing more exciting developments over the course of this year.
Ditching responsive design
We've just redesigned our home pages, and moved from a responsive design to an unresponsive one. Given the trend towards a responsive web, we thought we'd share why.
Why we ditched responsive design
When we designed our old home pages we followed the trend towards responsive design. The result looked great on desktops and went some way towards being device agnostic.
I don't think anyone would argue that it isn't a good thing to provide a mobile friendly interface for your web applications. However, we had focused on fitting content to a flexible grid without really assessing the requirements of our site.
When we came to redesign our site again, we decided to think through the case for responsive design. There were three factors which tipped the balance against responsive design:
- We were pitching to the wrong audience - it turns out that not many people shop around for Direct Debit on their mobiles. When we analysed our traffic, we found that only 2% of visits were from mobile devices.
- It was much slower to implement - responsive designs took almost twice as long to design and implement compared to fixed-width designs. This was valuable time we could have spent improving other areas of the product.
- It constrained our designs - we didn't have the resource to implement entirely different designs for desktop and mobile. This restricted us to simpler designs that could work for both formats. In some cases, this even led to compromised designs which weren't great for either format.
What did we do instead?
For our new design, we decided to stick to a fixed grid of 980px. This gave us a canvas that comfortably rendered on almost all desktops as well as on tablets.
Using a fixed grid roughly doubled the speed of the design and development process. It also gave us more flexibility to implement designs which wouldn't have worked at smaller sizes.
Not only did we save a lot of time by avoiding responsive design, we were also able to provide a better experience to 98% of our visitors.
When should you be responsive?
Sometimes the extra effort for responsive design is well worth the investment. We believe there are two criteria that determine this:
- The proportion of mobile use - obviously, if a significant proportion of your traffic is mobile, you should design for that audience.
- The purpose of the visit - will providing a better user experience for mobile users significantly impact your desired outcome?
For example, we believe it is really important to have a fully responsive design for our checkout pages. Even small changes in checkout page conversion can make a big difference to our customers. Whilst only ~3% of visitors to our checkout pages are on a mobile, having an appropriate design can significantly impact their conversion. So it's worth investing in, even for a small proportion of our visitor base.
Mobile visitors often have a very different set of objectives for visiting your site. In those cases, merely squashing content to fit on a smaller screen isn't particularly helpful. Instead, it is important to consider how different contexts change the content that users want.
Responsive design is definitely a useful tool to consider, but it's also important to be clear on the case for it before embarking on any new projects.
Exciting new features for PayLinks
We've been working on some exciting stuff at GoCardless in response to your feedback on what features you'd like. We're pleased to announce them here.
We're excited to announce two new advanced options to make
PayLinks (now GoCardless Dashboard) more convenient to use. When creating a PayLink, simply click 'Advanced Options' and you will have access to these features:
1) Specify where users are sent after they've paid: check out the 'Redirect customers after checkout' section in 'Advanced Options' when creating a PayLink.
2) Specify start and end dates for subscription payments: For example, you could specify monthly payments starting on the 1st of the month and stopping after 6 months.
Both these options are under 'Advanced Options' for any recurring PayLink you create. (If you can't see these, change the frequency from 'Once' to any of the other frequencies).
PayLinks for all!
We're equally excited to be able to give everyone access to PayLinks, our simple user interface for creating payment requests.
However you normally use GoCardless, you'll now see a 'PayLinks' tab in the top left of your GoCardless dashboard. From there you can create Direct Debit requests incredibly easily.
As ever, we'd love to hear your feedback and thoughts on GoCardless. Don't hesitate to get in touch with us at [email protected]!