Independent software vendors (ISVs) may periodically consider switching from their current integrated payments provider. We’ll take a look at some of the reasons businesses might consider making that change, as well as what they should look for in a new payments partner.
Why Businesses Switch Payment Providers
A 2018 survey by Mercator Advisory Group found that 1 in 5 small businesses that accept payment cards switched primary card processing providers within the previous two years. Many survey respondents stated that lower cost was their primary reason for the switch; however, better reporting, ease and speed of setup, and better service were also top reasons.
Businesses, especially retail, need detailed and customizable reporting capabilities, which are especially useful during reconciliation. ISVs need to offer a software solution to their merchants that includes a comprehensive transaction management and reporting tool with features such as:
- Online Reporting – delivers transaction reporting data for single- and multiple-location businesses
- Virtual Terminal – an online resource for processing transactions in real-time from any internet-connected device
- Transaction & Batch Management Controls – allow for quick-search capability based on several variables
Ease and Speed of Setup
ISVs and their merchants need quick setup of business management software and payment solutions, in order to avoid lost sales from lengthy downtime.
Businesses know the importance of quick and easy merchant onboarding. Research by North Highland Worldwide Consulting and Harvard Business Review found:
- 80% of executives said that “an increased focus on onboarding offers moderate to significant positive impact for revenue, client retention and client referrals over the life of the relationship.”
- 85% of executives agreed that successful customer onboarding helps to ensure long-term customer loyalty.
Given the importance of onboarding, ISVs might decide to switch if their payments partner can’t provide rapid digital merchant onboarding.
ISVs need a payments provider who’s a true partner - one that will support them throughout all steps of the partnership. Look for one who puts their clients first. A good payments partner will also provide easily-accessible technical support for your merchants.
What ISVs Should Look for When Switching Payment Processors
In addition to the items above, there are a few additional important factors you should look for when deciding to switch your payments partner.
Payment technology is rapidly and continuously evolving. ISVs need a payments partner whose technology is current with those changes. In addition to the traditional credit and debit card payments, make sure their payment functionality also allows for newer payment methods such as EMV chip cards and contactless payments.
Robust Security/Fraud Protection
Payment fraud is more than just a nuisance - it can be an expensive ordeal for businesses. Global losses from payment fraud tripled from $9.84 billion in 2011 to $32.39 billion in 2020, and this number is expected to continue to increase. Payment fraud is projected to cost $40.62 billion in 2027 - 25% higher than in 2020.
With payment fraud predicted to increase, it’s more important than ever to partner with a provider who offers a robust suite of payment security measures. These measures should include:
- EMV - EMV technology protects card issuers, merchants, and consumers from losses due to the use of counterfeit and stolen payment cards at the point-of-sale.
- Encryption - Encryption is a process that encodes information (such as cardholder data) so that it is unreadable unless decrypted by someone with knowledge of the decryption key.
- Tokenization - Tokenization substitutes a non-valuable "token" in place of sensitive cardholder data.
- PCI Compliance - PCI compliance refers to the operational and technical standards that all businesses that process, store, or transmit credit card data must follow. A good payments partner can help ensure you’re meeting these requirements.
Value-Added Products and Services
Payment functionality is only part of the equation when it comes to running a business. In addition to payment processing capabilities, merchants are now looking for business management software that also comes with tools and services that can help them increase engagement, enhance the customer experience and help their business grow.
These commerce enablement tools can include features such as analytics, reputation management, online appointment booking and forms, and more.
Additional Revenue Opportunities
If you partner with the right payments provider, there is additional value to your business in adding an integrated payments solution beyond the benefits it offers your merchants. Revenue sharing opportunities allow you to monetize the payments volume that flows through your systems, adding a predictable & forecastable revenue stream.
As an example, by partnering with Global Payments Integrated, one of our ISV partners increased their payments revenue from $120k to $1.5mm annually in the first year.
If you’re considering switching your integrated payments partner, contact us today to learn about the many benefits provided by a partnership with Global Payments Integrated.