CyberSource to provide financial services on VerticalNet
VerticalNet will announce tomorrow that CyberSource will provide payment and transactions services to companies on VerticalNet's trading communities.
VerticalNet, based in Horsham, Pa., operates and owns 56 industry-specific business-to-business trading exchanges where companies can buy and sell goods and services. CyberSource, based in Mountain View, Calif., will authenticate and process credit card payments for companies doing business on VerticalNet.
VerticalNet will also provide the companies on its portal with CyberSource's payment, tax and risk-management services to the companies on its industry portals.
Most e-commerce sites are still trying to find ways to blend the different services and needs of online marketplaces that connect suppliers and buyers. Analysts have said that procurement and payment are not well integrated with online sales; payments often are processed through tedious offline paperwork.
Earlier this year, American Express formed an alliance with Ariba, which makes software that helps create online marketplaces, to improve payment systems. Visa and MasterCard also have relationships with Ariba and its rival, Commerce One. Several start-ups, such as i-Escrow, InPurchase and eCash, are trying to find ways to fill the payment holes.
The rush to this sector is understandable given the expected size of the market. The leading research firms peg the business-to-business market at between $2.7 trillion and $7.3 trillion by 2004, compared with about $131 billion in 1999.
"CyberSource simplifies the process for both buyers and sellers within our trading communities to move from static purchase orders to real-time, Internet-based payment processing," said a VerticalNet executive. The deal with CyberSource will give "VerticalNet customers flexible services required for transacting business on the Web."