Chris Reddick (President and CEO of Clarity Ventures) and Ron Halversen (Vice-President of Sales and Marketing at Clarity) begin a webinar series about the different payment types for eAuction platforms.

Part 1 of a 7-part series

RON: All right, Chris. Another chapter for eAuctions and online auction software. I'm excited today, we're doing a good one. How are you doing today? 

CHRIS: I'm doing great. I'm excited, too. It's good to be with you again, Ron. And this is a really exciting webinar series that we're going through, and today we’re going through payments. That's certainly something that every seller and really every auction platform owner is interested in. So let's dive in and get into it. 

what is hipaa

RON: Sounds great. This one is big, and I'll just kick it off and then let you really dive into the technical part of it. One, it's got to be right. I mean, we're dealing with people's money here, right? And especially with the size of the eAuctions, you don't want to pay for a $2 million thing, have the transaction, have them ship the item, and then all of a sudden have the funds not cleared. 

One word that we're going to use a ton today is governance, right? You've got to have the governance. You have to know how to set those governance rules, how to enforce them, how to ensure that the buyers and sellers are following them, how to audit that. That's one. 

what is hipaa

RON: And then two, obviously on all the different platforms we talked about this I think in chapter two or three, I think three, we were talking about all the different devices, right? All the different device types. So when you're talking about different payments and enforcing governance, you have to enforce that across phones and tablets.  

And then I think the third element we'll really cover today is the internationalization of auctions, because now all of a sudden I might be dealing with multilingual, multicurrency. With the E.U., I might be dealing with GST, VAT taxes, GDPR, escrow funds. I mean, there are about 15, 20 different things. And we're literally just talking about payments, which is funny, isn't it? 

CHRIS: Yeah, that's right. It's probably one of the most sensitive, if not the most sensitive aspects, just because this is where the finality of the transaction occurs, at least as far as the technical details. This is going to be the pinnacle security aspect as well. And there's an element of trust here, because this platform itself isn't necessarily going to be taking accountability for every portion of the payment and rendering or fulfilling of the items purchased. So, yeah, it's really complex.  

Fundamentally, what we're dealing with here is an overall set of criteria that, depending on your market, can be relatively simple. It's going to have several underpinning components from a technical side of things that are consistent principles that you'll see throughout. And number one, the actual process itself has to account for the buyer and seller governance. These are workflows that are unique to auctions.  

So this is something that you're going to want to make sure that you're actually considering when you're looking at an eCommerce auction platform. Is the auction platform capable of handling some of these principles that we'll go into in more detail today? Then, depending on the scenario, it could be much more complex. In addition to dealing with buyers and sellers and making sure that there's some form of escrow or there's some proof of the ability to pay, or possibly a reserve, or some ability to have a governance around an issue with resolution and remediation. You could also be dealing with multicurrency, multilingual intermodal shipments, international shipments, VAT, multifaceted array of different variables here. 

So we're going to get into those today. And I'm excited to get into the weeds on some of those here. 

RON: That's excellent. Well, let's go ahead and kick it off and we'll jump right into governance for online eAuctions first. I'll just define it and then I'll let you dive into the technical aspects of governance. You might just replace governance with the legalities, rules, regulations, policies, procedures. All of that falls into that umbrella of what we call governance. 

The governance is literally the rules and laws that oversee everything that happens within the site. This could be governance around bidders and how they pre-authorized. Like with Barrett-Jackson, I might have to go in ahead of time two days before the auction to register as bidder, I might have to send in a bank statement showing I have a balance of at least $50,000 in account. That might be governance.

what is hipaa

RON: I can't just show up and bid on a car and not have any money to pay for it, because now that person has spent thousands of dollars to get that car to auction, to sell it in front of all those people, and there all those buyers. And then just went, “Sorry, I don't have the money to pay for it.” There are huge ramifications. So there's governance around just registering as a bidder at online auction sites, simply wanting to even put in a bid. It starts all the way from governance around how you could sell an item.  

I've seen many of those where they'll have strictly no reserve auctions and sometimes it's because they're only in a in an area or facility for the day. So they have to clear them out, they don't have time to spend five to ten minutes per auction. They only have like two minutes per auction. And the only way they can get the thousand cars through is to have a no reserve auction. So a lot of people that aren't willing to let their car go, no reserve, they won't even bid. 

There would be governance around, what's the word I'm looking for...marketing your auctions and telling people the types of auctions that are available. You want to make sure that the governance is something that can be easily articulated and marketed so that peoplecan understand the rules governing your site very quickly. 

So let's go ahead and dive in, Chris, to some of those governance rules. We're talking about payments, but we can mention some of the other governance things as we bounce through these ideas. 

CHRIS: Thanks, Ron. That's a great example to use with the car auctions. 

Continue to Part 2 to learn about governance for online auctions.