When it comes to the challenges of operating in the highly fragmented European Union (EU) market, no industry is spared.
Transport companies, for example, may find it difficult to follow the many rules specific to the heavily regulated commercial road transport (CRT) sector in the region.
These include toll charging schemes and rules for seconding drivers – the time they can spend on the road or mandatory requirements for rest periods – all of which are further complicated by differences in regulation applied from one country to another.
It is this compliance hurdle that Czech company Eurowag is trying to address with its payment and mobility platform, connecting its customers – trucking companies in the CRT sector and their drivers – with toll providers and utilities, regulators, shippers and financial service providers. .
“It can take a long time to keep track of all [these rules] and stay compliant,” Eurowag Group Treasury Manager Tomáš Novotný told PYMNTS in an interview. “But given that we operate in most, if not all, [the European] countries, it is easier for us to aggregate this information and then help customers apply these rules. »
The platform also helps simplify customer operations and remove the need for a manual back-office, providing its small and medium-sized business (SME) customers with fleet management support via fuel cards, toll management and governance of electric vehicles, among other services.
Read more: Czech mobility payments platform Eurowag files $236m IPO in London
In its first annual report as a listed company, the Czech payment and mobility platform said it processed around 32.5 million payment solutions transactions and generated 153 million euros (about 167 million dollars) of net revenue in 2021 from fuel card payments, tolls, taxes and more. CRT market solutions.
Today, the commercial fleet management service provider, founded in 1995, serves a customer base of more than 15,000 active payment solution customers and approximately 83,000 active payment solution trucks in the commercial trucking industry ( CRT) in Europe in the 30 countries in which it operates.
Filling an essential need for working capital
One of the key regulatory aspects of their job is to help customers comply with Value Added Tax (VAT) or Excise Duty Refund rules, under which CRT players who take a trip through several EU states are eligible for reimbursement of certain parts of their fuel consumption. .
The challenge for companies, according to Novotný, is to determine which parts of the journey are subject to the applicable rules and tariffs concerned. This is where Eurowag assists customers by calculating the refundable portion and requesting the refund from the relevant tax authorities on their behalf.
Once a claim is filed and there is confirmation of the amount owed by the customer in, say, three months, the Czech company can offer an advance payment and then collect the funds owed from the relevant tax authority. .
“The good thing about this is that we face sovereign risk, so by dealing with it with very low financial risk, we can support our customers with one of the most important needs they have, and that’s is working capital financing”, Novotný mentioned.
According to Eurowag’s Chief Financial Officer, Magdalena Bartoś, most of their SME or transport business customers do not have the bargaining power, business history or credit rating that would allow them to access the traditional type of financing. on the market. This puts Eurowag in a strong position to fill this financing gap in the industry.
“We have millions of real-time data points that we can use to assess customer credit risk – where the customer is, what their fleet usage is – [and] we can provide different KPIs [key performance indicators] and also manage client performance,” she said in the interview.
Digitization and data power
According to Bartoś, digitalization is one of the key elements of the long-term strategic growth of the company, supported by the recent launch of the Eurowag mobile application and the digital integration of customers, in addition to developing technological solutions rich in data that offer more seamless and integrated products to tackle key pain points in the industry.
One such weak point is the lack of tailored, industry-specific information to help medium to heavy-duty truck drivers steer their trucks in the safest and easiest way possible.
“They can’t use traditional retail navigation systems because those don’t have all the bridge clearances, on and off ramp guidance or various regulations [integrated]explained Novotný, adding that the company’s real-time data solves this important need.
Another key product from their recently launched digital platform addresses the issue of trust, which tends to be low in highly fragmented markets like the EU – whether it’s manufacturers needing to load a trucking company that they know very little about or trucking companies that invest time and resources to haul a load without knowing when and if they will be paid in the future.
Again, Eurowag can bridge this lack of trust by leveraging the data and information it has to effectively assess the backgrounds of the parties involved.
“Using data can be so powerful to deliver what we do today, but also to deliver the solutions of the future,” Bartoś said.
Register here for daily updates on all of PYMNTS’ Europe, Middle East and Africa (EMEA) coverage.