Founded in 1995 and headquartered in California, U.S., eBay Inc. is one of the world’s largest online marketplaces, facilitating both consumer-to-consumer and business-to-consumer transactions. As of 2017, eBay has more than one billion live listings and serves 170 million buyers in 190 markets. The firm aims to connect buyers and sellers through product experiences that are fast, mobile and secure.
As eBay expanded into Asia Pacific, the firm faced several complex cash management challenges. The biggest hurdle was in South Korea, where businesses often require service providers to open collection accounts with local banks in order to reduce costs and enhance banking relationships. As eBay’s customer base grew, so did the number of collection accounts.
In addition to managing multiple accounts, eBay faced significant challenges in reconciling balances and working with different platforms across various local banks. eBay needed a solution that could resolve this issue, which has long overwhelmed many businesses in South Korea.
eBay collaborated with J.P. Morgan to implement Virtual Collect, an enhanced account receivables reconciliation process that enabled eBay to simplify local currency collections in South Korea and reduced the need to maintain multiple accounts with local banks.
Through this solution, J.P. Morgan uses its accounts with major South Korean banks to receive eBay’s customer payments. Host-to-host connectivity enables the seamless transfer of funds between beneficiary banks to eBay’s account with J.P. Morgan.
How Virtual Collect works:
J.P. Morgan’s innovative virtual solution helped resolve a longstanding problem in South Korea around managing multibank relationships. The simple yet effective solution delivers process efficiencies, cost savings and reduces risk.
eBay became one of the first companies to implement an innovative unique account structure to manage multibank accounts in South Korea. Virtual Collect was readily accepted by eBay’s customers and delivered cost efficiencies for the firm by:
eBay is a highly commended winner of the Treasury Today 2015 Adam Smith Awards Asia Judges’ Choice Category
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