What if my Representment is Incorrectly Declined?
April 10, 2024
And what if a successful RDR or Ethoca submission gets charged back? Read on This blog breaks down the next steps.
How Can Payment Service Providers Optimize Payments?
Payment Service Providers (PSPs) provide value added services for Merchants. They use integrations and embedded functionality to make payments quick and easy. The traditional model of needing a fleet of developers and specialized knowledge to set up infrastructure and tools is being phased out. Merchants now turn to PSPs for everything from dispute services and tools to payment optimization and gateways—PSPs make modern payments possible.
For ISOs, integrations and relationships with the right PSPs can decrease Merchant churn and boost revenue. Let’s unwrap the PSP relationship a bit more and discuss their impact for Merchants.
How do PSPs Optimize Payments?
This simple question has many nuances, with a simple generalization—PSPs optimize a certain aspect of a Merchant’s payments. They can be gateways, mitigation tools, third-party services, analytics tools, and even Point of Sale (POS) terminals. Examples can include:
- A Merchant’s declines are rising, so they turn to a third-party analytics tool (a PSP) for insights on why
- A Merchant needs to free-up time from submitting representments, so they pick up a tool to generate representments (another PSP)
- An ISO’s Merchant is breeching compliance, so they are referred to a chargeback service (that service is a PSP)
- A Merchant needs a fast solution for hooking their Processor up to Shopify. Well, there’s a list of Gateways (more PSPs) to streamline the process
3 Ways That Integrations Can Generate Opportunity
ISOs can take a higher percentage than when processing high-risk Merchant transactions than low-risk. Increasing profits then comes from enrolling more high-risk Merchants, and keeping them healthier and happier for longer.
There are three ways that the right partnerships can make-or-break the bottom-line.
First, PSPs have their own network of integrations. You look at any gateway or payment software and they will have specific partnerships. While this may not directly mean PSPs are paying the ISO, it indirectly means that Merchants have new doors opened. Certain gateways offer new payment methods, different analytics tools can be designed specifically for that Merchant’s industry, and billing tools can enable running a subscription business.
Secondly, PSPs have their own brand recognition. That’s a powerful asset to leverage. Occasionally a Merchant seeks out a specific PSP, which can drive the decision of which ISO to work with.
Lastly, PSPs make the Merchant’s life easier. They alleviate the need for technical teams to build functionality from scratch, figure out the analytics, or hard-code APIs. A lot of PSPs are clean and easy to use for any Merchant.
Merchants are Bloated by Too Many PSPs
An ISO might require their Merchant to work with a chargeback company and use tools like Ethoca or Verifi to stay compliant. They may also require a Merchant to enroll in their own ISO-brewed compliance software. The next thing you know, the Merchant is paying quite a bit extra for a handful of tools and services that they may not find value in.
Not to mention—the Merchant can end up juggling windows and dashboards, trying to learn new workflows and understand the various fee structures. It’s a hassle and it’s the past.
The Rise of Integrated Payments
Integrated payments mean processing functionality is built directly into an existing software. It’s cheaper, simplified, and faster to adopt a single software with all the necessary features, with options to integrate additional add-ons, than to string together a handful of tools with overlapping functionality.
For ISOs, integrating PSPs into a holistic solution for Merchants means that your Merchants won’t feel bulked down and paying for tools they don’t need. It means a specific solution can be tailored around your specific industry, which keeps Merchants healthier and happier. And it means that ISOs can increase margin on enrolled Merchants.
Slyce360 Gives You New Revenue Generating Opportunities
Slyce360 enables data-driven decisions. Merchants get tools to understand and address rising payment problems, monitor compliance thresholds and optimize representments.
That means happier and healthier Merchants.
That means less churn.
New Blogs on Payments
Why Can’t I use Apple Pay Everywhere?
March 27, 2024
Apple Pay is accepted by over 85% of Merchants. Yet, it still feels like you need to check if Apple Pay is accepted. Let’s dig into why.
11 Things Every Merchant Needs To Know Before Taking Payments
March 13, 2024
Payments can be a minefield of fraud, chargebacks, and changing requirements. Not to worry, here’s a handful of tips for Merchants getting started in Payments.