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Payments

OTTO enters the payment market and founds OTTO Payments

In June 2021, Bafin (German Federal Office for Financial Services Supervision) granted OTTO the necessary license with that OTTO Payments can now offer merchants and marketplace partners various payment options from a single source. This provides many advantages for merchants and customers.

The biggest advantage of OTTO Payments: we have no longer to rely on external service providers for invoice and hire-purchases. By the end of 2023, all 11.5 million customer accounts will have been converted.

Review

Until now, the complex technical integration of the various payment services has been handled in part by OTTO itself as well as by external service providers. This was about to change: In order to further advance the transformation to a platform, OTTO relied on the establishment of its own payment company and with that on the basis for a uniform and modern payment process in the checkout. For this purpose PEG Payment Entwicklungsgesellschaft mbH was founded in autumn of 2020. The application for a license was submitted as early as February 2021. The license was granted on June 21, 2022. Mirko Krauel, Managing Director Market of OTTO Payments: "We are proud that we have established a payment service provider with a license from the corporate world in less than two years."

<p>Mirko Krauel (l.), Managing Director Market of OTTO Payments and Hans Georg Spliethoff, Managing Director Back Office of OTTO Payments.</p>

Mirko Krauel (l.), Managing Director Market of OTTO Payments and Hans Georg Spliethoff, Managing Director Back Office of OTTO Payments.

Advantages for customers

For our customers, OTTO Payments will make the payment process at the end of an order uniform and clear. Broadly speaking, there is now only one invoice per order and the use of all payment methods - such as invoice or hire-purchase - for all purchases made on otto.de. If customers wish, they can also enter their account details and pay by direct debit. Katy Roewer, Advisory Board Chairwoman of OTTO Payments and Head of Service & HR, is pleased that OTTO Payment now offers advantages for customers: "Setting up our own payment service provider was a milestone on the way to the platform. It is now the starting signal for managing all payment processes from a single source in the future - a huge advantage for customers and partners." For Hans Georg Spliethoff, Managing Director Market Tracking at OTTO Payments, there are even more innovations in 2023: "We plan to have converted all 11.5 million customer accounts by no later than the end of 2023." Customers will then also have a better overview about all invoices, installments, and returns in their customer accounts - regardless of the seller.

Katy Roewer, Chairwoman of the Advisory Board OTTO Payments and Divisional Director Service & HR The establishment of our own payment service provider was a milestone on the way to platform

Katy Roewer, Chairwoman of the Advisory Board OTTO Payments and Divisional Director Service & HR

Advantages for sellers

The money of customers who pay their bills no longer takes a detour via external service providers, and the partners now receive the payouts more quickly. The more than 4,000 marketplace partners on otto.de are already connected.

From 2023, the entire turnover of OTTO and the marketplace is to be processed completely via OTTO Payments. Until then, the company will continue to look for specialists, with around 50 positions still to be filled. In the medium term, OTTO Payments also wants to act as a service provider for other Otto Group companies.