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If you’re not familiar with the payments industry, read up on how a payment gets processed (credit card vs debit card vs ACH), the major parties involved (merchant, acquirer/payment service provider, processor, card network, card issuer, consumer), and how each party makes money from a transaction—know terms like interchange rate, take rate, card not present. Then understand where the company you’re interviewing at fits within the landscape. For example, PayPal and Square are both two sided networks that have merchant and consumer facing products, whereas fiserv is focused on merchants. Payments is a very technical industry so it’s a bit overwhelming at first, but I believe both Square and PayPal have a ton of information on their websites explaining these things
This X10. It's quite a technical industry so less room to BS.
1. Understand the landscape (merchant acquirer vs payment processor etc)
2. Deep dive into trends specific to that particular vertical
There's just so much to learn about it, it will be unrealistic to get a clear view of everything and not all of it will be relevant for that particular company.
Couple of things that I thought was interesting and may be worth looking at is the distribution / partnership strategy, and level of consolidation.
Interesting space to be in!
Couple of other things that are probably important to know from a growth strategy perspective:
1. Payments companies make most of their money from taking a cut of a transaction amount. For example, if you swipe your Chase branded Visa card, chase and visa both take a small cut, the processor takes a small cut, and so on. So payment companies are always focused on growing their total payment volume by entering new markets, signing new merchants (who wouldn’t want Amazon?), growing their consumer base—essentially maximizing volume that goes through their company
2. The industry can look very different country-to-country, mainly due to regulation and consumer payment method preferences. For example, credit cards are super popular in the US because high interchange fees allow issuers to fund expensive rewards programs which we all love (at the expense of the merchant—who receives less money for each credit card transaction), but they’re not as popular in Europe because governments have curbed interchange fees—choosing to benefit merchants over issuers
What did the interview questions / case studies end up being like?