PPRO Tackles Subscription Friction with Local Payment Push

The subscription economy has fundamentally transformed how businesses approach customer relationships, yet payment friction remains a persistent challenge for merchants globally. 

PPRO, the cross-border payment processor, believes the answer lies in extending the sophisticated infrastructure traditionally reserved for credit cards to local payment methods across emerging markets.

“Most people start with a credit card, that's perfectly fine. It works cross border, but then it does have some friction points,” explains Attila Doğan, VP Product Management at PPRO. 

The company has been working to replicate the seamless subscription experience that credit cards provide through innovations like real-time account updaters and network tokens, but for alternative payment methods that dominate markets outside the traditional Western sphere.

Expanding reach beyond traditional markets

The business case for subscription merchants is compelling. Large subscription businesses that may have separate entities in the US and Europe face significant barriers when attempting to serve customers in Southeast Asia or Latin America. 

“If they want to serve their customers in a market like Southeast Asia or in latam, to be able to supplement credit and debit cards with the local payment method to really reach their entire customer base is a huge thing,” Attila says.

This geographical expansion challenge has become more acute as subscription businesses mature and seek growth in markets where credit card penetration remains limited. 

Local payment methods in these regions often lack the sophisticated recurring billing infrastructure that Western merchants take for granted, creating a technical hurdle that can make or break international expansion strategies.

Addressing subscription-specific challenges

PPRO's approach extends beyond simple payment processing to address the unique challenges subscription merchants face. 

Free trial abuse, a persistent problem for subscription businesses, can be mitigated through nominal authorisation amounts that are instantly reversed. 

"We can do the same with a nominal small amount that is instantly being reversed," Attila explains, replicating the $0 authorisation model that works effectively with traditional card networks.

The company is also focusing on mandate management capabilities that allow merchants to implement flexible pricing plans whilst maintaining payment validity for extended periods. 

This approach aims to reduce the natural churn that subscription businesses have traditionally accepted as an inevitable cost of doing business with credit and debit cards.

Building standardised solutions

The ultimate goal is standardisation across payment methods, regardless of geography or local preferences. 

"We want to ensure that the payment instrument is valid as long as possible so you don't have that churn that is naturally accepted with traditional credit and debit cards," Attila notes.

This standardisation effort represents a significant technical challenge, as local payment methods were never designed with recurring billing in mind. 

However, PPRO's bet is that by bringing credit card-level sophistication to alternative payment methods, subscription merchants can unlock new markets while reducing the operational complexity of managing multiple payment systems.

"So we would love them to be as standardised as possible. And so far it's been a very interesting ride," Attila reflects.