If you’ve been in business for a while, it’s possible that your ISV has partnerships with a variety of payment processors, payment gateways, and other payment solution providers. Marci Gagnon, VP of strategic alliances for Qualpay, says, however, that there are strong arguments for transitioning to a partnership with one, integrated payments provider. Here are four reasons to consider making the switch.
1. Multiple Vendors = Problem-Solving Complexity
If you work with different vendors for payment processing, payment gateway, ACH, etc., it may not be immediately obvious who to turn to when something goes wrong. You may spend time just determining who to turn to for help before you begin to correct the problem — even with something as simple as a forgotten password. With an integrated solution, you have one main point of contact who can help you troubleshoot, get to the bottom of an issue, and solve it.
2. Streamlined Reporting
Using multiple vendors means a merchant has to pull reports from each system, for example, an authorization report from the gateway, a settlement report from the merchant account, etc. This requires more time and labor than pulling one report from an integrated payments provider.
Gagnon says this can be especially time-consuming for the nonprofit space. “Money has to be in the bank account before you can say someone has made a donation,” she explains. “It can take hours to reconcile reports.” Consolidated reporting is also a time-saver if the merchant is on a daily discount program, has a chargeback or adjustment, or receives a report that includes multiple batches after a weekend or holiday.
“With one consolidated report, you log into one portal, and if you have any questions, you have one person to contact,” she adds. “Time is money. If a merchant is spending resources on reporting, they could use that time to accomplish other things.”
3. Streamlined Compliance
Merchants must complete a PCI questionnaire that lists all payment vendors and states that they are compliant with PCI standards. With one, integrated PCI-certified provider, the merchant saves the time required to list each vendor separately and confirm that each is compliant.
4. Less Downtime
Some merchants (and their ISV partners) rationalize using separate vendors for payment processing and payment gateways by considering this as a way to back up operations. If the payment processing system is down, they can run transactions through the gateway and then upload them in a batch to the processor when the system is operational. Similarly, if the gateway is down, they can get voice approvals and upload transactions by batch later.
Gagnon says although that may work, it doesn’t solve the root of the problem — why the system is down in the first place. An integrated payments provider will quickly pinpoint the problem, implement a recovery plan and put the system back into service more quickly, ultimately decreasing downtime and eliminating all the extra labor it takes to manage workarounds.
You Shouldn’t Allow Relationships to Hold You Back
Your ISV business may continue to work with specific payment companies because you’ve established good relationships with them over the years — but when is the last time you compared their solutions to other technology that’s available to you and your clients?
Gagnon advises having an open and honest conversation about the technology your current payment partners provide and how they are working to update it to meet current demands. “But, if they aren’t updating their technology, and you continue to work with them, you could be costing your business and your customers a lot of money,” she comments. “Your customers could be paying more money than they need to. And if the payment solution is integrated with your software, you may not be able to offer your customers the features they want — upgrading to a new payments provider may help you sell your software.”
Making the Transition as Smooth as Possible
If you’re ready to make the transition from multiple payment vendors to an integrated system, Gagnon says it’s smart to do your homework before you make a decision. Ask for referrals from other ISVs about the support you can expect during the integration process, as well as whether the payment company known for a customer-first mentality. “A little research ahead of time will save you a lot of time on the back end,” she points out.
Of course, you need to make sure the payment processing vendor’s solution has the features your clients need, such as the ability to set up recurring payments and update expired cards. If your clients are B2B companies, you also need to make sure the solution can manage Level II and Level III data, which can mean significant cost savings to your client.
Also, consider the technology that the payment vendor uses. “This is something a lot of people miss,” says Gagnon. “If you’re integrating older technology, you may discover you need to upgrade after a short time. You don’t want to integrate a gateway with technology from the ‘90s. Find a partner with state-of-the-art technology. It will save resources later on.”