Managing multiple payment integrations in-house may seem like a smart growth strategy, but what is it really costing your business?
As businesses grow and expand into new markets, adding more payment service providers (PSPs) seems like a logical step. You want to increase payment success rates, support local payment methods, and ensure redundancy. However, managing direct integrations with each provider introduces significant technical, operational, and financial complexity that most businesses underestimate.
There are hidden costs to managing multiple payment providers in-house, and without help, they can needlessly drain your business of operational, speed, efficiency, and cost resources. However, there is a solution: payment orchestration can streamline operations, reduce risk, and optimize revenue.
Why Integrate Multiple Payment Providers?
Expanding your payment stack by integrating multiple PSPs can unlock important business benefits, including:
Support for localized payment methods: Global consumers expect payment experiences tailored to their market. That includes region-specific payment methods like iDEAL in the Netherlands or UPI in India. Supporting these methods improves customer experience and conversion rates.
Redundancy and backup: Some PSP downtime is inevitable. With multiple providers, you can route transactions to a secondary PSP when your primary is unavailable, ensuring business continuity and a consistent customer experience.
Better acceptance rates across markets: Utilizing local acquiring banks and PSPs typically results in higher transaction success rates due to a deeper understanding of regional regulations, banking protocols, and consumer behavior.
According to the Merchant Risk Council, the average merchant now relies on four PSPs and three to four acquiring banks to meet regional needs. For modern businesses, the question is no longer, "Should we work with multiple providers?" but rather, "How will we work with multiple providers?"
The Hidden Costs of Managing Multiple Payment Providers
Technical Overhead
Multiple API integrations: Each PSP has its own API, SDKs, and documentation. Integrating these APIs requires significant engineering time. Additionally, every time a PSP updates its API, you need to update your implementation to avoid breakages. As the number of PSPs grows, so does your need for engineering resources.
Version control and integration drift: As integrations evolve, they can drift out of sync with your main system. Keeping everything aligned requires constant monitoring, regression testing, and bug fixing.
Increased QA and testing requirements: Individual PSPs may have different approaches to transaction fields, response structures, and risk-modeling. Because of this, QA teams should carefully test connections before deployment. This important process extends release cycles and increases the risk of production issues and timing or cost overruns.
McKinsey expects the number of APIs in use in the financial sector to double by 2027. Increasingly, financial services companies are adopting APIs as a means to deliver services. That means the number of APIs you will have to deal with to maintain services and efficiencies will continue to grow.
Operational Inefficiency
Fragmented reconciliation and reporting: Different PSPs use different data formats, currencies, and settlement schedules. Managing these differing formats and schedules means that finance teams often rely on spreadsheets and manual processes to reconcile transactions, increasing the risk of errors and fraud.
Manual settlements: Without automation, teams must track settlements across providers to match revenue, chargebacks, and fees—a time-consuming and error-prone process.
Complex compliance: Each PSP may have unique obligations for data and privacy compliance, depending on the jurisdiction they fall under. Merchants must thoroughly review their documentation and contracts to understand their specific expectations, which requires significant resource investment.
Financial Leakage
Suboptimal routing and authorization rates: If you’re not dynamically routing transactions based on performance, geography, or cost, you’re likely leaving money on the table. Failed transactions and high fees directly impact your bottom line.
Higher transaction fees: Without visibility into PSP performance and pricing, you may be overpaying for certain transactions or regions.
Opportunity cost of engineering resources: Developers spending time maintaining PSP integrations are not building features that differentiate your product or serve customers.
Scalability Bottlenecks
Slow onboarding of new PSPs: Adding a new payment method or entering a new market requires a new integration, which can take weeks or months.
Lack of agility: Testing or switching providers becomes a major technical project, limiting your ability to adapt to market needs or optimize performance.
Research from S&P Global’s Voice of the Customer study revealed that 66% of merchants feel that keeping payment acceptance costs as low as possible is a high priority for their business's long-term ecommerce needs.
How Payment Orchestration Solves These Challenges
Global Connectivity to PSPs and Payment Methods
Payment connectivity enables businesses to link into a broad network of payment service providers (PSPs), gateways, alternative payment methods (APMs), and third-party services—all through a single, unified integration. Rather than building custom integrations for every payment partner, merchants can plug into a single payment orchestration platform with out-of-the-box connectivity.
Single API integration: Manage multiple providers, payment methods, currencies, and regions through one consistent interface.
No-code onboarding: Next-gen orchestrators allow merchants to add providers via a simple user interface without code.
Future-proof your stack: Easily add new PSPs or payment methods without engineering lift.
Add new digital wallets or alternative payment methods: As new payment methods arise or new methods become common among your customers, add them without additional engineering effort.
Integrate with third-party solutions: Leading orchestrators now offer integrations with fraud tools, CRMs, and ERPs, supporting modular scaling, which gives enterprises full control over their payments infrastructure.
Smart Transaction Routing
Payment orchestration enables intelligent transaction routing based on custom rules, such as:
Performance-based routing: Route transactions to the PSP with the highest authorization rates.
Cost optimization: Select the lowest-cost provider per transaction.
Geo-based routing: Use local acquirers to boost acceptance rates.
Failover routing: Automatically reroute transactions in the event of downtime.
Payment orchestration also allows merchants to gain visibility and transparency into PSP operations, since they have control over routing. These capabilities ensure merchants reduce failed transactions, improve conversion rates, and maintain customer satisfaction.
Unified Reporting and Analytics
One of the most significant operational benefits of orchestration is consolidated reporting:
One dashboard for all your data: Unified reporting across providers, currencies, and formats. No more CSV wrangling or merging exports.
Easier reconciliation: Streamline accounting processes by matching PSP reports to internal ledgers automatically.
Better fraud detection: Consolidated data improves visibility into unusual patterns.
Faster decision-making: Real-time insights into payment performance and customer behavior.
Lower Total Cost of Ownership (TCO)
Managing your payment stack manually carries both direct and indirect costs. Payment orchestration reduces TCO by:
Reducing integration and maintenance costs: A single connection to the orchestration platform replaces multiple costly integrations.
Accelerating time-to-market: Quickly test and launch new payment methods or providers.
Improving ROI: Higher success rates and lower processing fees directly add to the bottom line.
Unlike older orchestration models, next-gen platforms like IXOPAY offer modular services that scale with your business, support vaulting, fraud detection tools, and tokenization, and integrate seamlessly into your existing data stack.
What Makes a Best-in-Class Orchestration Platform?
Single API with no-code PSP integration
Modular scalability to match growth
Tokenization vault for PCI scope reduction
Post-processing for automated reconciliation
Real-time routing based on unique routing rules
Granular analytics down to the transaction level
Not all orchestrators provide the same capabilities. It’s worth considering whether a bundled PSP orchestration model meets your needs, as some may limit routing to their own networks or lack tokenization independence.
Key Takeaways
Managing multiple PSPs manually is costly, complex, and unsustainable at scale.
Hidden costs include technical debt, operational inefficiency, financial leakage, and scalability challenges.
Payment orchestration platforms like IXOPAY provide a smarter way to manage multi-PSP environments through centralized integration, smart routing, unified reporting, and lower TCO.
Orchestration isn’t just about payments—it’s a strategic tool for improving customer experience, increasing conversion rates, and driving global growth.
Are you managing multiple payment providers? Still dealing with spreadsheets, API breakages, and high decline rates?
It’s time to explore how payment orchestration can simplify your stack, improve performance, and reduce costs.
Request a Demo to see how IXOPAY can optimize your payment infrastructure.