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How do you deal with region based pricing knowing that anyone on the internet can pretend to be anywhere ? For example using a VPN

TomGullen 9y ago
It’s not too much of a concern, businesses and edu are generally honest. Issues come from b2c sales but it’s a mintority. We will have systems in place soon that will warn and suspend service if we suspect abuse - asking customer to provide proof of residence. When paying for something the processor often gives some evidence as to their country. For a lot of customers even b2c a properly issued invoice is important so that does narrow down abuse. Requiring billing address is a good catch especially for card verification although there’s a constant friction between the frictionless checkout and anti-fraud/region verification. Main struggle we’ve had is businesses buying the wrong package - (cheaper of course)! Best way to catch this is to only issue simple receipts to the plans aimed at b2c and tell them to email invoice address if they’d like a full invoice issued. A lot of people seem to be uncomfortable with region pricing based on abuse - however it’s important to bear in mind it doesn’t have to be 100% effective to be a net benefit. If your product is truly worldwide region pricing can be an absolute essential. As can region based billing cycles where in some cultures monthly payments are culturally the norm and annual can be hard to swallow. Every dimension of global saas payment systems is complex. I’m tempted to say there’s startup opportunity here but it feels like there will always be a lot of glue needed and a huge amount of flexibility between customers needs so I’m not sure how plausible it will be. Edit: worth mentioning is that EVERY saas company needs some region pricing - most simply you need to respect trade embargoes and deny all sales to specific regions as best as possible.
Silhouette 9y ago
A lot of payment services can now provide much more useful verification of a customer's location, e.g., checking the country where a card was issued or knowing the country where a certain payment method works or a bank account is located. This is becoming a necessity since various places, notably the entire EU, now require multi-point proof of customer location for tax compliance for at least some types of sale. It's easy to pretend you're somewhere else until you need to pay for something. Then you have the entire financial sector's anti-fraud systems to deal with, and a VPN isn't going to fool them for a moment.
- TomGullen 9y ago
  Iirc VAT laws require 3 sources of proof of country - that’s what we tried to do (IP, billing address and processor reported address) although often it’s only possible to get 2.
  - Silhouette 9y ago
    For the electronic B2C stuff in the EU, the requirement is two non-conflicting sources. Something like geolocation and card billing address should suffice in most cases (assuming you have access to the customer's IP address and they're paying by card, which is surely a fairly common situation for a SaaS).

TomGullen 9y ago

It’s not too much of a concern, businesses and edu are generally honest. Issues come from b2c sales but it’s a mintority. We will have systems in place soon that will warn and suspend service if we suspect abuse - asking customer to provide proof of residence. When paying for something the processor often gives some evidence as to their country. For a lot of customers even b2c a properly issued invoice is important so that does narrow down abuse. Requiring billing address is a good catch especially for card verification although there’s a constant friction between the frictionless checkout and anti-fraud/region verification. Main struggle we’ve had is businesses buying the wrong package - (cheaper of course)! Best way to catch this is to only issue simple receipts to the plans aimed at b2c and tell them to email invoice address if they’d like a full invoice issued. A lot of people seem to be uncomfortable with region pricing based on abuse - however it’s important to bear in mind it doesn’t have to be 100% effective to be a net benefit. If your product is truly worldwide region pricing can be an absolute essential. As can region based billing cycles where in some cultures monthly payments are culturally the norm and annual can be hard to swallow. Every dimension of global saas payment systems is complex. I’m tempted to say there’s startup opportunity here but it feels like there will always be a lot of glue needed and a huge amount of flexibility between customers needs so I’m not sure how plausible it will be. Edit: worth mentioning is that EVERY saas company needs some region pricing - most simply you need to respect trade embargoes and deny all sales to specific regions as best as possible.

Silhouette 9y ago

A lot of payment services can now provide much more useful verification of a customer's location, e.g., checking the country where a card was issued or knowing the country where a certain payment method works or a bank account is located. This is becoming a necessity since various places, notably the entire EU, now require multi-point proof of customer location for tax compliance for at least some types of sale. It's easy to pretend you're somewhere else until you need to pay for something. Then you have the entire financial sector's anti-fraud systems to deal with, and a VPN isn't going to fool them for a moment.

TomGullen 9y ago
Iirc VAT laws require 3 sources of proof of country - that’s what we tried to do (IP, billing address and processor reported address) although often it’s only possible to get 2.
- Silhouette 9y ago
  For the electronic B2C stuff in the EU, the requirement is two non-conflicting sources. Something like geolocation and card billing address should suffice in most cases (assuming you have access to the customer's IP address and they're paying by card, which is surely a fairly common situation for a SaaS).