Mondu: An in-depth guide

Last updated February 6, 2024
  1. Introduction
  2. What is Mondu?
  3. Where is Mondu used?
  4. Who uses Mondu?
    1. Key business sectors that use Mondu
    2. Business customer demographics that use Mondu
    3. What Mondu offers its users
  5. How Mondu works
    1. The process of initiating and routing a transaction
    2. Safeguarding transaction data
    3. Explaining Mondu’s fee structure
    4. Analytics-driven decision-making
  6. Business benefits of accepting Mondu
  7. The costs and fees associated with Mondu
    1. For businesses
    2. For business customers
  8. Mondu security measures
  9. Requirements for businesses to start accepting Mondu payments
  10. Alternatives to Mondu
    1. Stripe

Mondu is a buy now, pay later (BNPL) service that facilitates a substantial volume of transactions across many countries. The service is tapping into expanding demand for BNPL options—a market that is projected to grow from $30 billion in 2023 to $122 billion by 2030.

Mondu’s payment solutions span diverse European markets, where payment preferences can vary widely. For instance, the United Kingdom sees a higher volume of mobile payments compared to France and Germany.

The types of businesses that Mondu serves range from small startups to multinational enterprises. Mondu also provides security measures, such as fraud prevention and transaction analysis, but these features may align more closely with the needs of larger organizations rather than smaller enterprises or startups.

Below, we’ll cover what businesses should know about Mondu’s impact and functionality across markets.

What’s in this article?

  • What is Mondu?
  • Where is Mondu used?
  • Who uses Mondu?
  • How Mondu works
  • Business benefits of accepting Mondu
  • The costs and fees associated with Mondu
  • Mondu security measures
  • Requirements for businesses to start accepting Mondu payments
  • Alternatives to Mondu

What is Mondu?

Established in Berlin in 2021, Mondu has carved out a niche in the payment processing sector with a particular focus on business-to-business (B2B) transactions. Mondu offers BNPL payments, which have been gaining popularity, especially in the European market. Mondu tailors its services to businesses and marketplaces, providing a tool that offers their business customers flexible payment options, including the ability to pay over time for goods and services.

Mondu serves the growing demand for flexible payment solutions in ecommerce and business across several European countries, including the United Kingdom, Austria, the Netherlands, and France. The introduction of MonduSell in February 2023 marked an expansion of these services, which now allow for BNPL across multiple sales channels, such as online, by email, and over the phone.

Mondu’s platform integrates seamlessly with online checkouts, offering multiple payment options such as an invoice payment by bank transfer, SEPA Direct Debit, and installments. These options give business customers the flexibility to choose payment plans that suit their finances, with terms ranging from 30 to 90 days, in addition to monthly installment plans. Mondu accepts up to 90% of business customers at checkout, after running a credit check. This high approval rate—along with a centralized dashboard for payment tracking and easy integration into various ecommerce systems—positions Mondu as a versatile and accessible payment solution in the B2B sector.

Where is Mondu used?

  • Europe: A stronghold for Mondu
    Europe is Mondu’s central hub, and the platform enjoys a high level of popularity in Germany, Austria, the United Kingdom, and the Netherlands. It’s also available to business buyers in France and Belgium. In these markets, Mondu capitalizes on a well-developed ecommerce sector and customer preference for alternative payment methods. By offering flexible payment options that align with the diverse needs of the European market, the service appeals to both businesses and business customers.

  • North America: Emerging market for potential growth
    Though Mondu is not yet available in North America, the United States and Canada represent significant potential due to the region’s large ecommerce industry and the increasing openness toward innovative payment solutions.

  • Asia Pacific: Expansion opportunities despite competition
    The Asia-Pacific region presents a challenging but promising landscape for Mondu to expand, especially in Australia and Singapore. However, the region’s diverse payment system, which is characterized by strong local payment methods and digital wallets, poses a unique challenge.

  • Latin America and the Middle East: Prospects for expansion
    Latin America and the Middle East are also potential markets for Mondu to expand. These regions boast a growing ecommerce sector and a shift toward digital payments, creating fertile ground for Mondu’s expansion. Mondu’s cofounders previously built a successful ecommerce business in South America, so they’re familiar with the diverse markets in Brazil and the surrounding region.

Who uses Mondu?

Mondu has made significant inroads across several business sectors and business customer demographics.

Key business sectors that use Mondu

  • Online retail and ecommerce
    Digital storefronts are a significant part of Mondu’s user base. These businesses, which range from small online shops to large ecommerce platforms, benefit from Mondu’s streamlined transaction process. The system’s integration with online retail operations simplifies the checkout experience for business customers.

  • Small and medium-sized enterprises (SMEs)
    SMEs use Mondu for its straightforward approach to managing financial transactions. The platform’s tools for tracking and scheduling payments help these businesses maintain their financial health.

  • Business-to-business (B2B) services
    B2B service providers use Mondu for its efficiency in managing complex transactions. The platform’s capacity to handle large-scale payments and invoicing simplifies financial interactions between businesses.

  • Subscription-based models
    Businesses that operate on a subscription model, such as media platforms and software-as-a-service (SaaS) companies, rely on Mondu for its recurring billing capabilities. This feature helps maintain a consistent revenue stream and reduce the effort to manage subscriptions.

Business customer demographics that use Mondu

  • Technology-focused younger professionals
    This group, which is comfortable with digital-first solutions, uses Mondu for its easy integration with other tech services and its mobile-friendly platform.

  • Freelancers and independent contractors
    Freelancers use Mondu for its ability to simplify and track their varied financial activities and multiple income streams. The platform’s features give freelancers and contractors a clear overview of income and expenditures, which is particularly important for this group.

  • Entrepreneurs and small business owners
    For those running their own businesses, Mondu’s approach to handling incoming and outgoing payments fits the dynamic nature of their financial requirements. The platform’s user-friendly interface is particularly beneficial for business owners with limited time to manage financial operations.

What Mondu offers its users

  • Integration with business systems: Mondu’s ability to integrate with different business systems, especially ecommerce platforms, makes it an attractive choice for online retailers.

  • Diverse payment options: Mondu’s range of available payment methods, including options such as split payments, appeals to a wide array of businesses and business customers.

  • Simplified financial management: Both businesses and individual users benefit from the platform’s straightforward and easy-to-use interface.

  • Adaptability for business needs: Mondu’s customizable features allow businesses to tailor the platform to their specific financial requirements.

How Mondu works

The process of initiating and routing a transaction

  • Starting the transaction
    When business customers choose Mondu as their payment method at the point of sale (POS), Mondu’s network receives the business customer’s payment details along with the specifics of the transaction.

  • Directing transactions
    After the transaction is initiated, Mondu directs the data to the relevant financial entities, including the business’s bank (the acquirer) and the business customer’s bank (the issuer). This step is integral in validating transaction details, such as checking for sufficient funds and confirming the legitimacy of the payment.

Safeguarding transaction data

  • Protecting data in transactions
    A key tenet of Mondu’s operations is keeping personal data secure. The platform uses encryption and other security methods to keep sensitive information such as credit card numbers confidential throughout the transaction.

  • Fighting fraud
    Mondu implements sophisticated systems capable of analyzing transaction patterns to identify and prevent fraudulent activities, providing enhanced safety for both businesses and business customers.

Explaining Mondu’s fee structure

  • Charges for transactions
    Mondu levies a fee for every transaction that it processes. Typically, this fee includes a percentage of the transaction value along with a fixed fee. Factors that can influence these rates include the nature of the transaction, the business’s industry, and geographic factors.

  • Who pays the fees?
    Mondu, the issuing bank, and the acquiring bank share the fees. This structure is designed to cover the costs associated with processing the transaction, fraud prevention efforts, and network maintenance.

Analytics-driven decision-making

  • Analytics for business insight
    Mondu offers businesses tools for analytics and reporting, which provide valuable insights into transaction patterns and business customer spending behaviors. These tools are pivotal in helping businesses make well-informed decisions and refine their sales strategies.

  • Support for international transactions
    Mondu can manage transactions that cross international borders, supporting necessary currency conversions and adhering to various regional regulatory requirements. This capability makes Mondu a strong option for businesses with a cross-border business customer base.

Business benefits of accepting Mondu

Incorporating Mondu into business operations can provide operational advantages, which range from expanding market reach to gaining valuable business customer insights. The service’s combination of transaction efficiency, security measures, and data analytics makes it a comprehensive choice for businesses that want to enhance their payment processing capabilities.

  • Access to a broader customer base
    By adopting Mondu, businesses can connect with a wider audience, especially with business customers that prefer or rely on digital payment methods. This is particularly relevant for business customers that are accustomed to online transactions or those in regions where digital payments are the norm.

  • Streamlined sales processes
    Mondu allows businesses to handle a higher volume of transactions in less time, which benefits both the business and its business customers.

  • Security protocols
    Implementing Mondu allows businesses to take advantage of its advanced security protocols. This reduces the risk of fraudulent transactions, a significant concern for digital and online sales.

  • Data-driven business decisions
    Mondu provides businesses with access to detailed transaction data. By offering insights into business customer behaviors and preferences, this data can inform a variety of business decisions—from marketing strategies to inventory management.

  • Compatibility with various platforms
    Mondu’s system is compatible with multiple sales platforms, from POS systems to ecommerce websites. This versatility provides businesses with the added flexibility to accept payments in several different settings.

  • Simplified business operations
    Mondu offers application programming interfaces (APIs) and software development kits (SDKs) that integrate with existing business systems. This integration can simplify cumbersome business processes such as accounting, inventory tracking, and financial reporting.

  • Support for loyalty programs
    Mondu’s infrastructure also supports the integration of loyalty and rewards programs. This can help businesses gain repeat business and boost business customer engagement.

The costs and fees associated with Mondu

Although Mondu doesn’t make the exact costs readily available, the platform’s fees vary based on the nature of the transaction and the specific services used.

For businesses

  • Per-transaction charges
    Typically, businesses pay a fee for each transaction processed through Mondu. This could be a flat fee, a percentage of the transaction amount, or a mix of both. The exact structure often depends on the agreement with Mondu and can vary based on transaction volume and type.

  • Regular account fees
    Some businesses may encounter ongoing fees for using Mondu’s services. These can include charges for account maintenance or access to certain features or platforms.

  • Chargeback fees
    If a customer disputes a transaction and files a chargeback, businesses may incur additional fees. These chargeback costs cover the administrative effort of resolving such disputes.

  • International transaction charges
    Businesses that conduct cross-border transactions with Mondu might face additional fees, which can cover currency conversion and international processing.

  • Sector-specific rates
    Depending on the business’s industry, there might be specialized fee structures tailored to the sector’s specific needs and transaction patterns.

For business customers

  • Foreign transaction charges
    Business customers that use Mondu for transactions in a different currency or in another country may incur additional fees. Typically, these charges are a percentage of the transaction amount.

  • Cash advance costs
    If a buyer uses Mondu for a cash advance while making a purchase from a particular seller on the platform, the seller will receive up-front payment from Mondu minus a one-time fee.

  • Late payment charges
    Mondu may charge business customers a late payment fee for failing to adhere to the repayment schedule. Mondu imposes these fees to cover the increased risk of delayed receivables.

  • Annual charges
    Depending on the product or service, Mondu may charge annual fees. These are common for services that offer additional benefits or enhanced features.

Mondu security measures

  • Encryption methods
    Mondu’s security network uses advanced encryption strategies that extend beyond conventional Secure Sockets Layer (SSL)/Transport Layer Security (TLS) technologies. Distinct encryption protocols protect data in transit and data at rest, strategically reducing vulnerabilities at each stage of data processing.

  • Tokenization
    Tokenization is a main pillar of Mondu’s security strategy. It replaces sensitive card data and integrates with additional data points, including transaction history, to create intricate, multidimensional tokens that defy decryption attempts.

  • Risk assessment algorithms
    Mondu’s commitment to security is exemplified by continuous, real-time risk assessment powered by machine learning models. These models are trained on massive datasets, making them highly accurate in detecting potential threats and safeguarding transactional integrity.

  • Multifactor authentication (MFA)
    Mondu reinforces authentication with multifactor mechanisms—including SMS-codes, application-based authentication—and hardware second factors such as security keys. These measures are designed to resist phishing attacks.

  • Biometric modalities
    Mondu has extended its support for biometric security modalities beyond traditional fingerprint and facial recognition methods. These include voice recognition and behavioral biometrics, which further improve the authentication process and bolster security overall.

  • Regulatory compliance
    Mondu’s commitment to security extends to strict adherence to applicable regulations, such as the European Union’s General Data Protection Regulation (GDPR).

  • High-risk sectors
    Mondu recognizes the diverse needs of businesses, especially those operating in high-risk sectors, such as regulated substances. These businesses may encounter heightened scrutiny, including the possibility of higher transaction fees or mandatory adoption of specific advanced security features.

  • Customized products
    Mondu offers a range of payment solutions, each tailored with custom security features. Corporate cards, for instance, are equipped with advanced spending controls and real-time notifications, serving both financial management and security functions.

Requirements for businesses to start accepting Mondu payments

  • Merchant account setup
    Similar to the requirements for accepting card payments, businesses that want to accept payments through Mondu typically need to establish a merchant account. This can be done through an acquiring bank or a payment processing provider such as Stripe. The merchant account serves as the gateway through which transactions flow, facilitating the acceptance of payments.

  • Agreement with merchant services provider
    The contractual terms, conditions, obligations, and rights governing the payment processing relationship are usually outlined in the agreement between the business and the chosen merchant services provider. This agreement describes the responsibilities of both parties and sets the framework for payment processing.

  • Integration of payment terminals or POS systems
    Once the merchant account is functional, businesses must integrate payment terminals or POS systems that are compatible with Mondu’s payment methods, which include Visa cards. The specific hardware and software required may vary depending on whether payments are accepted in person, online, or through a mobile app. Mondu and Visa provide support for each of these payment environments, accommodating both physical Visa cards and those stored in digital wallets.

  • Compliance with Payment Card Industry Data Security Standard (PCI DSS)
    Regardless of the card network being used, businesses must adhere to PCI DSS requirements. This set of security standards is designed to safeguard card information throughout and after a financial transaction. Compliance with PCI DSS guarantees the security of payment data to maintain customers’ trust and confidence.

Alternatives to Mondu

Mondu has multiple competitors in the BNPL space, and which payment option will be a good fit depends on the industry, customer base, and individual needs of a business. What’s most important is finding a solution that meets your business’s requirements in a cost-effective way. While other flexible online payment solutions provide similar services to Mondu, one stands out for its global reach.

Stripe

Stripe is an ideal choice for ecommerce and app-based businesses that want to accept online and mobile payments. Stripe’s pricing is transparent, featuring competitive rates per transaction and no setup fees. Stripe is known for its developer-friendly APIs and extensive documentation to guide implementation.

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