FinanceFeeds Podcast Ep.#11: Zotapay’s Alex Behar offers insight into alternative payments for FX/CFD brokers

Rick Steves

The eleventh episode of the FinanceFeeds Podcast featuring Alex Behar, Chief Information Officer of Zotapay, the payments marketplace is out.

FF podcasts Alex Behar

The eleventh episode of the FinanceFeeds Podcast hosted by our Editor-in-Chief Nikolai Isayev is out. On the other side of the talk was Alex Behar, Chief Information Officer of Zotapay, the payments marketplace.

The productive talk saw them both embark on urgent topics for the FX and CFD brokerage industry as firms look to emerging markets without the hassle associated with those regions in regard to payments.

Listen on your favorite streaming audio platform

As he put it, Zotapay is a payments marketplace that allows merchants, predominantly Western ones – from Europe and North America – to access alternative payment methods (APMs).

The need is there because, outside the OECD, credit card penetration is under 20%, with nearly 3 billion cards issued to nearly 1.5 billion unique individuals. We usually call the other 6 billion people “unbanked”, but Alex Behar begs to differ: “They just don’t use the same banking instruments that we do”.

Enter Zotapay, whose focus is on the non-credit card world – although they also offer credit card solutions, but they’re bread and butter is to provide connectivity to the other 6 billion people.

Alternative Payment Methods reach the other 6 billion world citizens

Alex Behar reminded Nikolai that the card industry itself has been plagued by security issues ever since it was born. “if you can take a photo of the CVC on a card, you can process that transaction”. And there are more reasons to avoid cards besides their security faults: cost is one of them.

Listen on your favorite streaming audio platform

For example, at a seafood market in Indonesia. a POS terminal is likely to cost more than the seller’s fishing boat. “It’s a major investment just to participate in the card network itself. This is why alternative methods ended up sort of winning the popularity contest in the emerging markets.”

“Today, a fully functional Android phone is $25. It has NFC, it can scan and display QR codes, and the settlement is immediate for these APMs”, said Alex Behar in defense of alternative payment methods.

“It provides security like no other card ever could because both devices are connected to the internet. They’re able to conduct a transaction without any sensitive information. Inherently, the fraud rate or bad transaction rate of APMs is much lower. That’s why a lot of merchants and vendors would lean towards APMs once they understand the ecosystem and how reliable it is”, he continued.

And, as opposed to cards, APMs are bidirectional, which allows them to both acquire and send funds, which is an opportunity for brokers to build “amazing features”. The card ecosystem is also plagued with chargebacks, which risk is priced in among all clients. Such disputes come in factions of a percent for alternative payment methods because these are immediate.

Zotapay acts as the broker’s payments team + technologies in a box

Alex Behar saw the APMs trend accelerating over the pandemic with Emerging Markets reducing exposure to cash and only a few players like Zotapay offering APM solutions in those regions.

Zotapay is catering to all kinds of diverse clients: from local government agencies trying to reach their own citizens  to public FX and CFD houses with large reputations to defend.

Listen on your favorite streaming audio platform

“Larger treasury desks and the wider brokerage industry are aware of the financial operation challenges of dealing with multiple vendors, currencies, settling from multiple destinations, assuming all the currency risk while funds are being repatriated”, he continued, pointing that as the reason why largest institutions have dozens of staff in their payments division and adding that Zotapay acts as a payments team along with all the associated technologies in a box.

“We operate multiple relationships per jurisdiction”, he said as he explained the hassle for brokers to address each market, starting from connecting to several payment services providers (PSPs), and the recurring outages or maintenance issues that make brokers miss conversions no matter their marketing budget.

“What we would do on behalf of our clients is effectively maintain all of these relationships around the world. Currently, as of a few weeks ago we are looking at 1200 payment methods all around the world in 60 markets” and this would translate to a familiar experience for the payment client. raised conversions. more trust, and branding opportunities for brokers.

Zotapay effectively flattens everything into a single API or one of their various plugins for the benefit of their clients. In this case, from the brokerage industry.

Zotapay’s flows are reliable even on 2G networks

The firm has doubled down on its mobile-first payment focus because, after conducting thousands of transactions per second, they realized the internet is not as reliable as in the developed world, with 5-6% of global internet being inaccessible at any given moment.

“We monitor the same mobile internet providers in the same city to check outages of PSPs to avoid lost conversions, so that all of our flows are reliable on 2G networks”, he said, adding that they support hundreds of legacy phones that are no longer supported by their maker in order to widen the addressable market.

As to the cost of acquisition for the online trading industry expanding into the emerging markets – including Africa, Southeast Asia, and LATAM – it is much lower than first thought because these brokerages marketing campaigns directed at Europeans are often broadcast all around the world. It inadvertently affects the cost of acquisition for a lot of companies.

If they’re brand is already strong in, for example, Europe, then the cost of acquisition in emerging markets is lower and the ability to address them is now technologically more feasible with solutions like Zotapay.

Zotapay uses stablecoins to compete against SWIFT and SEPA

Zotapay is not particularly focused on the digital asset space, although the firm is a user of the institutional side of crypto.

“We use stablecoins to compete against SWIFT and SEPA. For providers all around the world we are able to work directly with stablecoin issuers. Today, it is effectively cheaper to transact outside the SWIFT and SEPA networks”, he explained, adding that much has changed during the last crypto cycle with a lot of institutional groundwork and capital which allowed the ecosystem to challenge certain norms in settlements.

Listen on your favorite streaming audio platform

“I think that part is here to stay and grow”, he continued as he sees increased openness from vendors and law enforcement successfully tracking down the “baddie”, which raises trust within the institutional world.

Transactions using ETH mainnet and BTC should be further down the road as these are still very expensive today. “Until we see a major L2 adoption or material change to gas fees on Ethereum it is unlikely that retail” will adopt them.

Alex Behar is an expert in cybersecurity

The interview also covered travel, food, and Alex Behar’s passion for fighting cybercrime and extremism. He is a visiting lecturer on Cyber Defense and Crisis Management at the University of National and World Economy, Department of “National and Regional Security”.

He said one of his biggest achievements is to teach and pass on the hard work in law enforcement, which is something that gained center stage with the Russian invasion of Ukraine as smaller democracies realize the existing talent pool for cybersecurity is not enough for the demand, which leaves them more vulnerable to threat actors.

Sponsorship opportunities on FinanceFeeds Podcast

FinanceFeeds is the premier independent real-time news source for the FX and CFD trading industry, fintech, and the wider finance community. The launch of the podcast series opens up new sponsorship opportunities for companies looking to tap into our niche audience. For more information, please email us at [email protected]

It is not by chance that podcasts have become content goldmines. These are effective tools for marketing because they help brands hyper-target audiences and are great for building thought leadership within the industry. It’s a good return on investment while creating value for listeners.

All previous episodes of the FinanceFeeds Podcast are available on all popular streaming audio platforms.

Read this next

Digital Assets

Germany-focused DekaBank taps METACO for digital asset custody offering

“Digital assets are a critical part of the future, a radical new way for how assets will be represented, from currencies to real estate.”


Eventus launches AML solution for TradFi and digital asset space

“Firms operating in traditional financial markets and digital assets alike are facing greater challenges than ever to protect themselves from those presenting a risk to their businesses and reputations, along with their standing with government regulators.”

Industry News

Qomply launches direct-to-FCA trade report solution that bypasses ARM

“Certainly, for back-reporting large volumes of data, QomplyDirect removes extra ARM fees by offering the flexibility of sending reports directly to the FCA via a firm’s own infrastructure.”

Executive Moves

BNP Paribas AM appoints Geoff Dailey as Deputy Head of US Equities

“Geoff has more than 20 years’ experience in the industry and as a key, senior member of the team with a strong investment pedigree and leadership profile, he is the natural successor for Pam.”

Retail FX

BUX joins forces with BlackRock for iShares ETFs offering in 7 European countries

“By joining forces with Blackrock, a renowned expert in financial markets and products, we have created a good solution for clients that are overwhelmed by the choice of products and don’t know how and when to start investing. Together, BUX and BlackRock can make a real impact on how Europeans invest and approach their financial future.”

Retail FX

CMC Invest gets in-principle approval to launch shares, ETFs, futures, and options in Singapore

“This announcement is a major milestone and validation for CMC Markets. Our business has been offering CFDs in Singapore since 2007, but the Capital Markets Services Licence for CMSI will allow us to serve our clients with more robust investment products, including shares and ETFs.”

Executive Moves

Eightcap hires ex-IG, ex-StoneX Alex Howard as CEO

“In my first weeks, the priority is to immerse myself in the business, including connecting with the global team, developing a nuanced understanding of strategy and operations, and listening to clients.”

Digital Assets

OneCoin founder Ruja Ignatova is selling penthouse in UK

OneCoin founder Ruja Ignatova, who steered one of the world’s biggest cryptocurrency frauds, is back into the spotlight more than five years after vanishing from the public eye.

Digital Assets

Bitpay taps MoonPay to offer access to +60 cryptocurrencies

Crypto payment service provider Bitpay said it’s partnering with exchange and web3 infrastructure provider MoonPay to provide its users with easier access to buy cryptocurrency instantly.