Pay-Fac Sooners and Boomers
Payment Facilitators (Pay-Fac) may be the next wave of “timing is everything” for the payments industry and could bring a once-in-a-decade opportunity to companies looking to enter segments by staking a claim on a business model that differentiates them from the myriad of other companies that go head to head with each other, mainly over price.
Pay-Facs can provide that differentiation. Banks says that rather than price, Pay-Facs compete on value that can be articulated in several ways.
Timing was important when merchants started working with banks to sell goods and services on credit, it was important when payment gateways began working with online websites to enable eCommerce, and it was important when ISOs formed partnerships with software companies and introduced merchants to integrated payments.
Fast-forward to today, and these arenas are flooded with well-established companies who have already staked their claim, making it difficult for anyone new to find greenfield opportunities and break into these spaces.