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Pure Commerce, pure export

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Exporting financial software to South Korea is no small feat: particularly if you’re the first company to do it. Find out how Australian company Pure Commerce took on a Korean bank to win their confidence and a healthy contract. In the financial software industry, conducting business at a national level is an enormous achievement. Pure Commerce recently upped the ante with a deal to provide a multi-currency payment solution to the Korean Exchange Bank (KEB) for the next five years, the first time an Australian company has sold payment technology into a Korean financial institution. Not just any Korean bank either, but the largest foreign exchange bank in South Korea. Established in 1967 and headquartered in Seoul, KEB is the fifth largest bank in South Korea, as measured in assets. With the largest global network, it has an important role in the development of South Korea’s new banking strategy. Pure Commerce is an Australian exporter of flexible international payment solutions for financial institutions and corporate partners. Launched in 1997, the privately owned company has offices in Singapore, Sydney, London and Zurich. It specialises in partnering with financial institutions seeking new ways to extend their existing systems. Their product offering includes currency conversion, EFTPOS solutions, multi-currency payment processing, treasury and rate management and online eBanking tools. Currently based in Singapore, CEO Daniel Lavecky had just returned from a Pure Commerce family fun day when Dynamic Exportcaught up with him. "We had our corporate fun day last weekend for the Sydney team and their families. We’ve got offices in Sydney, Singapore and London, and Korea now as well, so I’m thinking we’ll have to do the same thing for them for next year," he says. "Maybe my role as CEO will now become that of party manager?" It’s obvious Lavecky is successful at building relationships, a skill that has stood Pure Commerce in good stead throughout their historic export journey to South Korea. Traditionally the Korean market is well known for being extremely complex for foreign companies to understand the business culture and sell into, with local companies and services the preferred option in most cases. However, according to Austrade’s senior trade commissioner in Seoul Martin Walsh, Korea is the third largest export market for Australia, and in fact, Korean financial institutions often look to Australia’s financial system as a successful model. With its history of regulation problems, Korea is currently implementing a new financial services system largely mirrored on the Australian framework. This then provides an opportunity for savvy operators like Pure Commerce to capitalise on the interest, which then opens the market to other Australian businesses to provide financial solutions for the developing model. So, how did this landmark agreement occur?

Making introductions

Prior to Pure Commerce arriving in South Korea, they conducted research and made appointments with banks that were genuinely interested in their product. "Rather than just getting on a plane to Korea and saying ‘We’re here!’ we worked very closely with the trade commission prior to going," explains Lavecky. "We identified all the banks, ranked them in priority, and then the trade commissioner made initial contact to find out who the senior executives were, which really saved us a lot of time." The team also made many early presentations, usually in PowerPoint, which were translated into Korean and sent over. In 2006, KEB and Pure Commerce then met during an Austrade mission to South Korea. To build the relationship following their initial positive feedback from KEB, Pure Commerce opened a local office and courted the bank’s executives for many months. "In Korea, you need to speak the local language. They’re very happy to work with foreign technologies because they like to say they’re using new brands, but this needs to be supported by local presence," explains Lavecky. "You can either achieve this through using agents or opening up an office yourself." With this in mind, and following the success of the trade mission, Pure Commerce asked their Korean sales person to relocate to South Korea permanently. "We invited Yong to stay in Korea to continue building relationships, which he saw as a great opportunity. In addition to presentations, there were a lot of executive lunches, golf games and corporate entertainment. This is especially needed in Korea," says Lavecky. "A lot of money has to be invested to create a situation where they not only say ‘yes you’ve got good technology’ but also, ‘we like working with you’. The relationship took a year to build to a point where the bank was willing to talk to us about using our technology."

Being diligent

The bank then did an assessment internally as to whether they could get similar software from inside Korea, or from someone else globally. "They did a comparison against our competitors as well," explains Lavecky. "And that’s where our local relationships really became useful because people not only based their decisions on our technology and service, but on the relationships we had with them. When I say relationships, I mean trust: do they trust you? And do they trust that if there is a problem you can actually resolve it?" KEB executives also travelled to Australia, with half of the costs covered by Austrade’s Export Market Development Grant. "As part of their due diligence some of the senior executives did extensive due diligence on our technology here and whether it adhered to all of their bank’s security standards," says Lavecky. Austrade’s assistance was also essential to the successful agreement, he adds. "They worked on many different levels and really helped us understand the region and the cultural differences. They helped us cut through the clutter and bureaucracy, for instance when some people say ‘Yes I’m the right person’ when in fact they’re not. They facilitated the process and provided feedback on how we could handle particular potential situations." The commission even went the extra mile and supplied Australian beef for a key event at a Korean steak house, showcasing the Australian Government’s support of Pure Commerce. It took 18 months from the first trade mission for Pure Commerce to secure an agreement with KEB. It’s not unusual for these processes to take a long time, says Lavecky: "Banks are notoriously slow, and government as well. They run highly complex systems that support sometimes hundreds of thousands of customers, so there is very limited scope for failure. So in our industry, a one to two-year sales cycle is normal." Through this partnership, the bank’s merchants will be able to convert credit card payments made by foreign visitors from Korean won to their home currency at the checkout, through Pure Commerce’s flagship fxCHOICE dynamic currency conversion (DCC) service. This service will significantly reduce confusion faced by foreign visitors when making a payment. It will also benefit KEB’s business customers by providing a new revenue stream; they’ll be able to charge foreign exchange commissions on every international transaction converted. DCC will be available on up to 135 currencies, providing KEB’s merchants with a greater opportunity for conversion and increased foreign exchange profits. Says Lavecky: "We are really celebrating this: it’s a big win for us and for our company. It’s an indication that if you’ve got tenacity and the desire and the commitment, you can make it happen." For more information on Pure Commerce, see their website at www.pure-commerce.com

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