How payment orchestration is democratizing the payments landscape
This article was first published in Financial IT.
About Rene: Rene Siegl is the Founder and Executive Chairman of the IXOLIT Group, which was founded in 2001. Since 2014 Rene has been leading the development of the IXOPAY Payment Orchestration Platform, which addresses the global payment scaling needs of online merchants and licensed payment institutions.
Taking payments online has traditionally been dominated by the large card schemes. Merchants were extremely limited in how they could process transactions and therefore subjected to the expensive fees of the few providers available. As eCommerce has grown, so has the payments landscape. While some merchants have leveraged this to their favor, others have yet to optimize their setup in order to get the most out of their payment stack.
How is the landscape changing?
The last two years have been the perfect breeding ground, as most businesses had to shift all or most of their business online and more customers were forced to make online purchases. This has seen an explosion in the use of alternative and local payment methods, who cater to those who may not own a credit card or have a bank account. PSD2 and strong customer authentication (SCA) has seen more consumers, capable of using traditional methods, embrace open source technology, such as open banking and forgoing the use of debit or credit cards.
However, payment methods are only part of the story. It is also about the user experience as the way in which we shop has changed. With our online lives now bleeding more and more into our offline ones, we expect our shopping experiences to be more organic and seamless. With social and networking sites now offering a purchasing experience, and consumers wanting seamless experiences. The checkout page has changed. We no longer want to fill in vast amounts of details across multiple pages, we want quick buy now buttons that can be done in seconds.
How can merchants adapt to these changes?
Merchants are now having to spend more time building integrations to payment service providers, improving their checkout pages which allow for omnichannel experiences, all the while running their business. However, with a payment orchestration platform, they can consolidate their payments and easily build optimized checkout experiences that work across all their shopping channels, such as websites, social media, and brick and mortar stores.
So what is a payment orchestration platform (POP)? A POP works as a technical layer that sits between the merchant and their payment service providers. Through one API, merchants can connect to multiple providers, use smart transaction routing, consolidate all their payment data and benefit from real team analysis. It is about providing merchants access to payment service providers and payment methods that are best suited to their business. It is not only letting the merchants choose who they want to work with, but also how. This freedom of choice, working with providers based on what they can offer your business, gives merchants the flexibility and independence they need to scale. For this to be done successfully and with as little friction as possible, a payment agnostic orchestration platform, like IXOPAY, is required.
How Payment Orchestration puts merchants in the driving seat
Merchants who use a payment orchestration platform are given the infrastructure they need to build and grow their payment stack. Merchants can build check out pages that work across multiple platforms, or use payment links and QR codes which are common across social media sites and messaging functions.
By connecting with payment service providers through this additional layer, they can negotiate better deals, and avoid provider lock-in and route transactions easily across all their providers. With the IXOPAY payment orchestration platform, you can connect to providers in the library instantly and for connections that have not yet been made, only a quick build time is needed. More and more retailers are seeing the benefit of working with multiple payment service providers. All merchants can have access to this technology, not only does it protect their bottom line, but it also allows them to expand and scale their business when and how they would like, by giving them the tools to reach out to new markets and offering the payment methods used by the locals.
How can fintechs benefit from payment orchestration?
The benefits for the merchant are clear, however why is a payment orchestration platform interesting for fintechs? The answer is simple, as a technological service and agnostic provider with no financial licence, the techonology is perfect for white labelling. By white labelling a platform and branding it in your corporate design, fintechs, such as acquires, PayFacs, ISOs, and more are able to create an additional revenue stream without the complex and costly issues that come with building their own product. We have also seen how banks, both digital and traditional, are seeing it as an opportunity to benefit from the PSD2 directive and use it to bring an innovative product to their existing and new clients.
By streamlining the payment infrastructures of businesses and eliminating the need for building and maintaining complex integrations, merchants are able to choose their perfect payment stack. Working with an independent provider, such as IXOPAY, means that there is no financial gain—for the POP—from the merchant’s choice of provider, giving them the ability to choose the right payment providers based on merit and worth to their business alone. A payment orchestration platform allows its users to not only survive but to truly thrive in the payments ecosystem.
Interested in finding your perfect payment stack?Contact
IXOPAY is a payments orchestration platform enabling independent, flexible and global payment processing. As a highly scalable and PCI-DSS certified “fintech enabler”, IXOPAY fulfills the needs of large merchants as well as those of “white label” clients: payment service providers (PSPs), acquirers and independent sales organizations (ISOs). The modern, easily extendable architecture offers smart transaction routing & cascading, state-of-the-art risk & fraud management, fully automated reconciliation and settlements processing, comprehensive reporting as well as plugin-based integration of acquirers, payment service providers and alternative payment methods (APMs).
IXOPAY is part of the IXOLIT Group, founded in Vienna, Austria in 2001. With local entities in Austria and the USA, IXOLIT supports national and international customers across various industry verticals. The owner-led and -financed company has grown from 2 to more than 65 employees and is focused on building innovative solutions for eCommerce.
Please find more information about IXOPAY here: https://www.ixopay.com