Optimising payments for cross-border success with Coupang

As a growing number of companies look to tap the accelerating popularity of online commerce, they need to create new payments processes that suit the changing nature of their business.

In Asia Pacific, for example, the size of the online commerce market is expected to grow from US$4.20 trillion in 2024 to US$6.76 trillion by 2029, at a compound annual growth rate of 10% during the forecast periodⁱ. And in line with this, many companies are moving from traditional wholesale distribution to direct-to-consumer models.

Such a shift typically requires online marketplaces to transform and streamline their digital payments and collections processes for both customers and vendors alike. However, this transition isn’t always smooth.

The right payments solution is an essential component in helping online retailers pursue growth and differentiate themselves from competitors.

For example, in the case of Coupang, the retail company headquartered in the US, the focus is to connect its customers to the goods they need in a swift and efficient manner. “This is the central tenet of our business,” explained Eddie Hong, Group Treasurer at Coupang. “This is what has helped differentiate ourselves among buyers in our markets of operation.”

The same goal of delivering convenience applies to all stakeholders. From customers of any demographic, to small- and medium-sized enterprises (SMEs) that use Coupang’s services, to its domestic and international sellers.

Ultimately, to achieve the mission of making users think “how did we ever live without Coupang?” relies on a best-in-class experience for everyone who interacts with the business. “We identified driving speed, efficiency and convenience for stakeholders across the world as key focus areas,” said Hong.

More payment efficiency, scale and clarity

From a payments perspective, the priority to achieve this objective is the efficient processing of a large number of low-value cross-border payment transactions.

HSBC’s Global Disbursement (GD) solution was the answer. In short, it combines the bank’s FX and payments services into one seamless process for cross border, low-value mass payments. “This enables Coupang to pay sellers in over 130 currencies from a single account, which creates a lot of flexibility for Coupang to expand to a new market and scale up its payment volume in a highly efficient way,” explained Yiu.

More specifically, given the solution is connected to low-cost domestic payment rails, payments are received according to standard times and are highly predictable. “This helps reduce uncertainty and, at the same time, allows Coupang to better advise sellers on when payments can be received,” she added.

This approach also provides greater transparency, choice and security. For example, Coupang can now more readily identify the end-beneficiary, apply FX rates, and see the payments status.

With GD being a first-of-its-kind solution in South Korea, Coupang has established a new industry benchmark for driving efficiency on cross-border payments.

“We own the entire end-to-end international payment process, including the identities of the ultimate beneficiaries of accounts. This has added an additional layer of seller authentication,” said Hong. “We also have real-time visibility on the payment status, which allows us to better advise our international sellers on when they can expect to receive their funds.”

Advancing payment optimisation: the journey continues

With a scalable and efficient retail ecosystem comes the possibility of faster and more robust growth opportunities in the online commerce space.

Such a goal reflects the importance of finding the right payments solution. “This has strengthened our credentials to sellers as their marketplace of choice,” said Hong, explaining how the treasury function plays an important role in helping deliver a more idealised user experience.

“The work we do on optimising payments and collections can prove vital in deepening our relationship with our users, while also contributing greatly to further our organisation’s goals,” he added.

This also serves as a testament to how HSBC continues to develop meaningful propositions that help customers like Coupang stay ahead of the curve. “Delivering new and effective solutions will allow us to continue unlocking new possibilities for online commerce companies and customers, which will prove essential as the business environment continues to evolve at pace,” said Yiu.