Even in markets where credit card penetration is high, shopping cart abandonment is still a major source of concern for online vendors. Now imagine the situation in Southeast Asia, where many countries have dozens of e-wallets, buy now, pay later, services and other forms of payment. Wire transfers are also a popular option for online purchases, but they involve several steps, which increases the risk of cart abandonment.
Arrow wants to ease the checkout process by acting as a layer over payment gateways. It supports over 50 different payment methods, including all the major ones in Singapore, Malaysia, and Indonesia (including Atome, GrabPay, Boost, and GoPay).
The company announced today that it has raised $4.8 million led by Sequoia Capital India, with participation from Alpha JWC and Zinal Growth. Angel investors including AIG and Maxis board member Ooi Huey Tyng, Paysend COO Steve Vickers and Coinbase Southeast Asia boss Hassan Ahmed also participated in the round.
Launched 15 months ago, Arrow was founded by Liat Beng Neo and Sebastian Roervig and is now used by 100 merchants. Liat Beng Neo told TechCrunch that one of the main reasons for cart abandonment is that “current checkout processes in the region do not take into account its incredible diversity. Southeast Asia is made up of eleven different countries, each with their own e-commerce habits and nuances.”
For example, he added that some regions have poor internet connectivity, so customers might drop out of the checkout process if it involves clicking through multiple web pages. Even popular payments like bank transfers involve multiple steps, each of which carries the risk of a customer changing their mind about a purchase.
In addition to payment methods, Arrow also integrates shipping information and affiliate loyalty programs, so customers see everything on a single checkout page. Arrow can be integrated with shopping platforms like WooCommerce or Magneto or through APIs that allow merchants to replace their existing storefronts with Arrow. For social commerce, retailers are given a checkout link that they can send to their customers.
Arrow can be used by all types of merchants, but it’s focused on FMCG and other discretionary goods and services, said Liat Beng, because those tend to have high cart abandonment rates. It also caters in particular to merchants dealing with high order volumes, as they would benefit most from improvements in cart abandonment rates, she added.
Arrow is currently active in Singapore, Malaysia and Indonesia, and plans to focus on these three markets for the time being, while planning expansion to the Philippines, Thailand and Vietnam.