No argument: Software developers/independent software vendors (ISVs) like you will increase the value you offer your customers by integrating payments. To begin with, it’s more efficient for your users when payment data is shared with their point of sale (POS) and accounting systems. It decreases the demand for labor in the back office – and reduces the chance for human error. Also, don’t underestimate the fact that integrated payments enhance experiences for consumers, streamlining checkout even when they redeem loyalty points or reload gift cards. Cashiers don’t have to run payment cards separately, taking extra steps and extra time.
The Legend of Legacy Payment Integration
Even though it's easy to see the benefits, legacy integrations are notorious for being anything but easy. It means multiple SDKs, possibly different developers for each platform, lengthy integration processes. And, sometimes, you spend time waiting on assistance from your payments partner.
It’s a mistake to enter into a partnership without getting the answers you need about the payment integration – and not looking at all of your options, including those that offer easy integration through APIs. However, there are other common mistakes that ISVs make with payments that can have a more significant and long-lasting impact on your business.
A Half-Dozen Errors and Missteps with Payments that ISVs Need to Avoid
Strategically choosing a payments partner requires you to make good decisions when it comes to:
1. One partner vs. multiple partners
Some ISVs attempt to meet their users’ needs by partnering with multiple payments companies. For example, one for small and medium-size (SMB) retailers, a different payments partner for enterprises, and yet another for B2B companies.
This strategy isn’t the best in the long run, though, because it monopolizes too much of your time to maintain multiple integrations and multiple vendor relationships. Moreover, providing certain users with only the specific capabilities they need today may limit their options as their businesses grow or expand in the future.
In a perfect world, you’ll find one omnichannel payments platform that enables users to choose – or change – the payment capabilities they need. However, if you do require multiple payment partnerships, look for a processor-agnostic partner with broad connectivity that allows you to manage all payments through a single integration and a single interface. A partner that gives you freedom to choose the processors you work with will enable you to route your clients in certain verticals to the payment processors that offer them the best services and rates -- and give you more leverage for negotiation.
In addition to the flexibility a payments platform offers you and your users, consider the agility the company has itself. Dig deep to learn your potential partner’s place in the payments ecosystem, the partnerships it has, and its ability to move money and enable transactions at any point of engagement. Your ability to answer, “Yes, we can do that,” will largely depend on your partner’s capabilities, and it’s crucial to your business that your partner can provide the payments capabilities you can offer your clients as your business grows and scales.
3. Market focus
Some payments companies specialize in providing services to a specific type of customer (e.g., SMBs, enterprises, or businesses in particular verticals). That may work for your user base today, but will it hold you back from expanding to new markets in the future? Finding a payments partner with a track record of successfully serving all types of clients – from microbusinesses to large international companies – will ensure all of your users will have the capabilities they need. Additionally, a partner committed to innovating and staying ahead of market trends will ensure your payments platform will scale with your business.
Payment processing is complicated. The technology, payment chain, transactions, security – even merchants’ statements – can be hard to understand. But they don’t have to be. Look for a payments partner that’s totally transparent and can demystify payments for you and your users. If you don’t get straight answers to your questions, it’s best to keep looking.
5. The big picture
Up until 2020, technology advances drove changes in payments – a prime illustration is the transition to EMV payments when merchants and consumers needed to change the payment tech they used and the process of making a card-present payment.
Now, however, demand for payment features and services is consumer-driven. For example, consumers decided to give contactless payments a second look during the pandemic. The National Retail Federation (NRF) reported that 69 percent of retailers saw an increase in this payment type in 2020. Additionally, U.S. e-commerce grew by 44 percent, and some of the largest brick-and-mortar retailers, like Walmart, Target, and Dick’s Sporting Goods, cite buy online pickup in store (BOPIS) as a game-changer.
Of course, this is a snapshot of how things are immediately post-pandemic – they could rapidly change again. It’s important for you to stay informed about the payments space and its direction so that your solution and payments are relevant to your users and their needs.
6. Emerging technology
You also need to keep an eye on payments innovation and whether a prospective payments partner has the technology to support it. For instance, make sure your payments partner is set to support tap to mobile payments. This technology turns merchants’ mobile devices into payment terminals – no dongle required. Following PCI Security Standards Council’s data security standard for CPoC (contactless payments on consumer-off-the-shelf devices), tap to mobile provides a secure way to accept payments without investing in payment terminals.
This advancement can enable more merchants to accept digital payments and, possibly, help you create total solutions for your users that are more convenient and affordable.
Make No Mistake
The NMI team knows there is an overwhelming number of moving parts in the payments space that can make it hard for ISVs to integrate payments with their solutions, provide the omnichannel services that merchants need, and maintain agility now and in the future.
We keep our ISV partners front of mind as we make decisions about enabling integrations, ensuring flexibility through relationships with more than 250 payment processors and 125 shopping carts, helping to eliminate complexity. NMI is also on the cutting-edge of payments, working to bring solutions such as tap to mobile to market. So let’s talk about getting – and keeping – your business on the right path.
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