The Software-as-a-Service model has evolved over the years, expanding into virtually every industry, and there is no exception with the Integrated Software Vendors (ISV) and their impact on the payments industry and space. Today, we see that while payments have not traditionally been the centerpiece of the ISV model, they are beginning to play a larger role in the customer experience and journey, which also means, they must be a solution that is flexible and straightforward.
Rather than integrating and supporting connections for e-commerce, mobile, point-of-sale, reporting, and reconciliation, ISVs can partner with one payment provider and simplify the process. With that flexibility, ISVs can offer more competitive rates, better security, and gain access to a full-service support team.
One integration for all payments needs
ISVs also realize the value of partnering with a Payments-as-a-Service (PaaS) provider who can offer them everything they need, all in one place. Moreover, PaaS providers are customizing their services to fit these niche vertical markets, making sure that the ISVs stay with them based on the services provided rather than finding ways to profit on transaction volume. As ISVs want to have the entire experience, the payments component must be simple, straightforward, and flexible. That means ideally; the ISV only need one platform, one integration, and one billing service to power their software.
More often, we see larger ISVs rebranding the payment gateway, ensuring brand consistency throughout the entire process. That way, their customers interact with only the ISVs brand, while the payment partner operates silently in the background making sure all systems are firing.
Better pricing models
Traditional payment models were geared towards profiting from the success of customers – the higher the transaction volume, the more a provider can make. That is no longer the case when an ISV integrates with a PaaS provider. Rates are flat or bundled, so customers get one simple bill without hidden fees. ISVs and their payment partners grow together, where the ISV can buy the payment services at a wholesale price and sell it to their customers for retail. And at better prices, everyone benefits as the ISV can be more appealing to the end customer with more competitive rates in the market.
Of course, processing payments always comes with the risk of fraud, but that responsibility doesn’t need to fall on the ISV. In addition to implementing security features like Address Verification Services (AVS), Card Verification Value (CVV), and 3D Secure to keep their clients safe, ISVs can avoid rigorous PCI upkeep by storing and transmitting payment information via a PaaS provider’s PCI-certified server, which keeps the data secure and their business out of scope. Furthermore, to ensure sensitive card data never touches their servers, ISVs can use secure payment fields embedded directly into the user interface, enhancing the customer experience by keeping users in one place and not sending them elsewhere to complete the payment.
Using a tokenization service encrypts every piece of payment information into a single token, which again is stored on the PaaS provider’s certified server. That encrypted token can then be used whenever the end-user makes a repeat purchase. As many ISVs operate on a recurring or subscription model, tokenized information is retrieved whenever the customer is billed or makes another purchase. And in the event of a data breach, that encrypted information will be rendered useless to fraudsters.
A full-service support team
When an ISV integrates with a payment partner, they immediately gain an extension of their team for anything payments related. An ecosystem as complex as payments deserves a full-service team. The ISV can trust their payment partner to handle the payments side of things, even if they decide to white label their solution from integration support, account management, and customer support. Having a dedicated customer experience team for payments can make the onboarding experience seamless for the ISVs customers. Any questions or issues that arise are handled directly by the payment partner. This makes the experience for the ISV as hands-off as they would like while still maintaining the level of control that they want.
No matter what industry, the ISV market is highly competitive. Payments now more than ever must be seamless and straightforward – from functionality to economics, as ISVs will do their due diligence to integrate a solution that will give them the most value for their dollar.